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because Mr. Dunne was not a beneficial owner of FRC for any part
of 1997.
The doctrine of collateral estoppel provides that once an
issue of fact or law is “actually and necessarily determined by a
court of competent jurisdiction, that determination is conclusive
in subsequent suits based on a different cause of action
involving a party to the prior litigation.” Montana v. United
States, 440 U.S. 147, 153 (1979); Parklane Hosiery Co. v. Shore,
439 U.S. 322, 326 n.5 (1979). For collateral estoppel to apply,
the following five conditions must be satisfied:
(1) The issue in the second suit must be identical in all
respects to the one decided in the first suit;
(2) there must be a final judgment rendered by a court of
competent jurisdiction;
(3) collateral estoppel may be invoked against parties and
their privies to the prior judgment;
(4) the parties must actually have litigated the issue and
the resolution of the issue must have been essential to the prior
decision; and
(5) the controlling facts and applicable legal rules must
remain unchanged from those in the prior litigation.
Brotman v. Commissioner, 105 T.C. 141, 148 (1995); Peck v.
Commissioner, 90 T.C. 162, 166-167 (1988), affd. 904 F.2d 525
(9th Cir. 1990).
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Last modified: March 27, 2008