The opinion of the court was delivered by: Bua, District Judge.
Plaintiffs Anthony Millonzi, Joseph C. Millonzi and Aagard
Electric, Inc. bring this action against defendants Bank of
Hillside; Christian F. Henning, Jr. and Associates, Ltd.;
Christian F. Henning, Jr., Attorney-at-law; Donald C. Morris;
Harold E. Collins; and Harold E. Collins & Associates, Ltd.
Before the Court are plaintiffs' motion for a preliminary
injunction and certain defendants' motions to dismiss the
complaint. For the reasons stated below, defendants' motions to
dismiss and plaintiffs' motion for a preliminary injunction are
The facts alleged in the complaint and presented at the
preliminary injunction hearing are numerous and complex. For
purposes of this opinion, however, they need only be summarized
briefly. In November of 1982, defendant Bank of Hillside filed
a suit in the state court seeking to foreclose on Anthony
Millonzi's home. On July 27, 1983, judgment was entered for the
Bank of Hillside. On August 3, 1983, a notice of sheriff's sale
of plaintiff's home was mailed to Anthony Millonzi. See
Complaint, ¶¶ 31-32.
In August of 1983, plaintiffs filed bankruptcy under Chapter
11. After the automatic stay was lifted, Anthony Millonzi's
home was sold at an auction by the Sheriff of Cook County to
the Bank of Hillside. Millonzi's right to redeem the property
has expired. See Complaint, ¶¶ 33-35. The certificate of sale
is presently in the possession of the Bank of Hillside. Under
Illinois law, the holder of the certificate of sale may obtain
a sheriff's deed to the property and then bring a forcible
detainer action to expel the Millonzis from their home. See
Complaint, ¶ 35.
Plaintiffs seek the following relief. First, a preliminary and
permanent injunction which would prevent defendants from
obtaining possession of Anthony Millonzi's home. Second,
plaintiffs seek a declaratory judgment that a mortgage and
certain notes executed by the plaintiffs are void. Third,
plaintiffs request that the Court impose a constructive trust
on Anthony Millonzi's home. Finally, plaintiffs seek
compensatory and punitive damages.
Defendants Bank of Hillside, Donald Morris, and Harold E.
Collins (individually and as a professional corporation) move
to dismiss the complaint on various grounds. First, defendants
argue that the doctrines of res judicata and collateral
estoppel bar the plaintiffs from bringing this suit in light of
the prior state court foreclosure judgment and the plaintiffs'
bankruptcy proceedings. Second, defendants argue that the
complaint fails to state any claim for relief. Third,
defendants argue that all necessary parties have not been
joined. Fourth, defendants Collins and Collins & Associates,
Ltd. additionally argue that since July of 1982, they had no
involvement with any co-defendant or plaintiffs and therefore
should be dismissed as parties in this case. Finally,
defendants argue that any order granting plaintiffs' motion for
preliminary injunction would violate the Anti-Injunction Act,
28 U.S.C. § 2283.
Res Judicata and Collateral Estoppel Defenses
Under Marrese v. American Academy of Orthopaedic Surgeons,
___ U.S. ___, 105 S.Ct. 1327, 84 L.Ed.2d 274 (1985), "[t]he
preclusive effect of a state court judgment in a subsequent
federal lawsuit generally is determined by the full faith and
credit statute. . . . This statute directs a federal court to
refer to the preclusion law of the state in which judgment was
rendered." Id. at ___, 105 S.Ct. at 1328-29. Under Illinois
law, the doctrine of res judicata provides that:
A prior judgment may have preclusive effects in a subsequent
action under both res judicata and collateral estoppel. The
doctrine of res judicata provides that `a final judgment
rendered by a court of competent jurisdiction on the merits is
conclusive as to the rights of the parties and their privies,
and, as to them, constitutes an absolute bar to a subsequent
action involving the same claim, demand or cause of action.'
When res judicata is established `as a bar against the
prosecution of a second action between the same parties upon
the same claim or demand . . . it is conclusive not only as to
every matter which was offered to sustain or defeat the claim
or demand, but as to any other matter which might have been
offered for that purpose.'
Housing Authority of LaSalle County v. YMCA, 101 Ill.2d 246,
78 Ill.Dec. 125, 12728, 461 N.E.2d 959, 961-62 (1984)
(citations omitted). The party asserting the affirmative
defenses of res judicata and collateral estoppel "has the
burden of proving the existence and character of the former
judgment as well as its legal effect with relation to the
matters alleged to be concluded by it." LaSalle National Bank
v. County of DuPage, 77 Ill. App.3d 562, 32 Ill.Dec. 935, 937,
396 N.E.2d 48, 50 (1979).
Defendants reliance upon the doctrine of collateral estoppel is
also misplaced. Collateral estoppel applies only as to issues
"actually litigated and determined and not as to other matters
which might have been litigated or determined." Housing
Authority for LaSalle County, supra, 78 Ill.Dec. at 128, 461
N.E.2d at 962. Defendants have failed to apprise the Court as
to what extent, if any, plaintiffs' present claims were
actually litigated in the prior proceedings. ...