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(4) The parties must actually have litigated the issues and
the resolution of these issues must have been essential to the
prior decision.
(5) The controlling facts and applicable legal rules must
remain unchanged from those in the prior litigation.
Arguably, petitioner has satisfied the more procedural of
the five conditions in that a final judgment was rendered in
Pierce I, the parties are identical in both cases, and the
controlling facts and applicable legal rules have not changed.
Further, the negligence issue, which petitioner asserts is the
same as that being decided in the current case, was litigated and
essential to the Pierce I decision. However, petitioner does not
satisfy the one substantive condition that is the core
requirement for application of collateral estoppel.
Collateral estoppel promotes judicial economy by preventing
successive litigation of identical issues. The issue in the
current case is not, in all respects, identical with the issue
decided in Pierce I and, therefore, does not satisfy this
condition for application of collateral estoppel. The issue
litigated in Pierce I was whether petitioner and Mr. Pierce were
liable for negligence penalties provided for in section
6662(b)(1). Negligence, as defined in section 6662(c), includes
“any failure to make a reasonable attempt to comply with the * *
* [Code]”. Negligence also includes a “lack of due care or
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