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The facts pertaining to the Shorecliffs transaction are
closely intertwined with each other, as are those relating to the
SCE partnership. Consequently, to the extent that any of the
related matters must be litigated, much of the evidence and
argument will of necessity go to the relevant transactions as a
whole. Because we are satisfied after review of the record that
at least a majority of the above-enumerated points lacks the
requisite basis for issue preclusion, it becomes apparent that
significant redundancy is unavoidable.
Furthermore, cognizant of the rather unconventional nature
of the California trial court’s disposition (in the form only of
a special verdict and judgment) and the otherwise troublesome
state of the record in these cases, we cannot take lightly the
principle that “issue preclusion must be applied carefully so
that fairness to litigants is not compromised for efficiency and
economy.” Monahan v. Commissioner, 109 T.C. 235, 242 (1997); see
also United States v. Silliman, 167 F.2d 607, 614 (3d Cir. 1948)
(“Such a rule of public policy [collateral estoppel] must be
watched in its application lest a blind adherence to it tend to
defeat the even firmer established policy of giving every
litigant a full and fair day in court.”).
Hence, absent a clearer picture of what transpired in State
court and in light of the interdependence of many pertinent
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