                                                                           FILED
                           NOT FOR PUBLICATION                              JUN 03 2011

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS




                            FOR THE NINTH CIRCUIT



DEPARTMENT OF EDUCATION,                         No. 09-15988
STATE OF HAWAII,
                                                 DC No. 08 CV-0255 SOM
              Plaintiff - Appellee,              D. Hawaii

  v.
                                                 MEMORANDUM *
KAREN I., in her capacity as parent and
legal guardian of Marcus I.,

              Defendant - Appellant.



DEPARTMENT OF EDUCATION,
STATE OF HAWAII,

              Plaintiff - Appellee,              No. 09-17608

  v.                                             DC No. 08 CV-0255 SOM
                                                 D. Hawaii
KAREN I., in her capacity as parent and
legal guardian of Marcus I.,

              Defendant - Appellant.




        *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
                   Appeals from the United States District Court
                             for the District of Hawaii
                Susan Oki Mollway, Chief District Judge, Presiding

                      Argued and Submitted February 17, 2011
                                Honolulu, Hawaii
                       Submission Vacated February 23, 2011
                            Resubmitted May 16, 2011


Before:      TASHIMA, W. FLETCHER, and BERZON, Circuit Judges.

      Appellant Karen I. challenges the district court’s determination that the State

of Hawaii’s Department of Education (“DOE”) was not obligated to pay for her

son Marcus I.’s residential placement for the 2006-07 school year. The district

court had jurisdiction under the Individuals with Disabilities Education Act, 20

U.S.C. § 1415(i)(3). We have jurisdiction pursuant to 28 U.S.C. § 1291, and we

affirm.

      1.     The court reviews de novo the question of whether a school district’s

proposed individualized education program (“IEP”) provides a free appropriate

public education (“FAPE”). Gregory K. v. Longview Sch. Dist., 811 F.2d 1307,

1310 (9th Cir.1987). De novo review also applies to a district court’s ruling that a

claim is barred by the doctrine of res judicata, or claim preclusion. Stewart v. U. S.

Bancorp, 297 F.3d 953, 956 (9th Cir. 2002).



                                          2
      We look to Hawaii law to determine whether the state court judgment has

preclusive effect on the DOE’s subsequent appeal in federal court. Albano v.

Norwest Fin. Hawaii, Inc., 244 F.3d 1061, 1063 (9th Cir. 2001). “It is settled law

in Hawaii that the judgment of a court of competent jurisdiction is a bar to a new

action in any court between the same parties or their privies concerning the same

subject matter, and precludes the relitigation, not only of the issues which were

actually litigated in the first action, but also of all grounds of claim and defense

which might have been properly litigated in the first action but were not litigated or

decided.” Quality Sheet Metal Co. v. Woods, 627 P.2d 1128, 1130 (Haw. Ct. App.

1981). At issue here is whether the claims asserted in both actions are the same.

Albano, 244 F.3d at 1064.

      “To determine whether a litigant is asserting the same claim in a second

action, the court must look to whether the ‘claim’ asserted in the second action

arises out of the same transaction, or series of connected transactions, as the

‘claim’ asserted in the first action.” Kauhane v. Acutron Co., 795 P.2d 276, 279

(Haw. 1990) (citing Restatement (Second) of Judgments § 24 (1982)). The claim

must be viewed “in factual terms . . . coterminous with the transaction regardless of

the number of substantive theories, or variant forms of relief flowing from those

theories, that may be available to the plaintiff . . . .” Id. n.6. If the claim now


                                            3
asserted “could have been raised in the earlier state court action,” the claims are the

same for the purposes of Hawaii res judicata analysis. See Pedrina v. Chun, 97

F.3d 1296, 1301 (9th Cir. 1996).

      Here, Karen I. raised two related issues in separate requests for an impartial

due process hearing. The first issue is whether the DOE was required to pay for

Marcus’ 2006-07 residential placement under the parties’ settlement agreement.

The second issue is whether the DOE wrongfully refused to put a residential

placement in Marcus’ 2006-07 IEP. Karen I. argues that the state court decided

only the first issue, leaving the second issue for the hearing officer to determine in

the first instance. Even if the two issues are distinct, they effectively form the

same claim because they arise out of the same transaction or series of connected

transactions. Karen I. wanted the DOE to pay for Marcus’ residential placement

because she believed it was a “necessary component” of his educational program.

She had two theories for pressing this point: (1) payment was required under the

terms of the settlement agreement, and (2) a residential placement was necessary to

provide a FAPE (and thus should have been in the IEP). These theories are

different grounds for reaching the same outcome: that the DOE accept financial

responsibility for Marcus’ 2006-07 residential placement. See Quality Sheet Metal

Co., 627 P.2d at 1130 (explaining that res judicata “precludes the relitigation . . . of


                                           4
all grounds of claim and defense which might have been properly litigated in the

first action but were not litigated or decided.”).

      Accordingly, the state court judgment bars the ultimate remedy sought by

Karen I. We sympathize with Karen I.’s argument that the state court’s orders

were unclear. However, the state court ruled as a matter of law that the DOE was

not obligated to pay for Marcus’ residential placement for the 2006-07 school year.

We are bound by that ruling. See Gov’t of Guam v. Cruz (In re Gov’t of Guam),

869 F.2d 1326, 1327 (9th Cir. 1989) (explaining that res judicata applies “even if

the court in the first litigation was wrong in its determinations”).1

      2.      We review a district court’s denial of attorneys’ fees for abuse of

discretion.   Parent V.S. ex rel. Student A.O. v. Los Gatos-Saratoga Joint Union

High Sch. Dist., 484 F.3d 1230, 1232 (9th Cir. 2007). Where we review “rulings

of the district court regarding local practice and local rules, the appropriate

standard of review is abuse of discretion.” Guam Sasaki Corp. v. Diana’s, Inc.,

881 F.2d 713, 716 (9th Cir. 1989).


      1
              Because IEPs must be reevaluated at least annually, the state court’s
decision does not exert preclusive effect on adjustments to Marcus’ IEP in
subsequent school years, including determinations whether residential placement is
required in order to provide a FAPE. See Haw. Tel. Co. v. Public Utils. Comm’n,
827 F.2d 1264, 1274 (9th Cir. 1987) (explaining that income tax claims in
successive tax years, or rate claims in successive rate proceedings, are not the same
claim for res judicata purposes).

                                            5
       Here, the district court denied Karen I.’s initial motion for attorneys’ fees for

failure to comply with Local Rule 54.3(b). The district court clearly instructed

Karen I. that careful compliance with Local Rule 54.3(b) was necessary. It gave

her a second opportunity to bring her motion and file the required statement of

consultation. Karen I. did not timely file the statement, and presents no compelling

excuse for the failure to comply. Under these circumstances, we conclude that the

district court did not abuse its discretion.

       The judgment of the district court is

       AFFIRMED.




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