XL Sports, LTD. v. $1,060.000 Plus Interest Traceable to Respondent, RES, and Jerry Lawler

Following a transaction involving the sale of a business, the plaintiff filed suit against several defendants in federal court alleging causes of action grounded in federal and state law. The federal jury found some of the defendants liable, but they concluded that one of the defendants did not engage in any wrongdoing during the transaction at issue. Thereafter, the plaintiff filed suit in a Tennessee chancery court seeking to impose a constructive trust over funds held by the defendant exonerated by the jury. The defendant removed the case to the federal district court. The district court determined that the claim was barred by the doctrine of res judicata. The plaintiff appealed to the federal court of appeals, which ruled that the case was not properly removable, as it only presented a claim based upon state law. On remand to the chancery court, the defendant asserted the affirmative defenses of res judicata and collateral estoppel. The chancery court subsequently granted the plaintiff’s motion for summary judgment. The defendant appealed to this Court. We reverse the chancellor’s grant of summary judgment to the plaintiff, and we hold that the plaintiff’s claim for a constructive trust is barred by the doctrines of res judicata and collateral estoppel. Accordingly, we dismiss the case in its entirety.