                           NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                       NOV 20 2019
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

HEIDI ANGLIN; ERNEST ANGLIN,                    No.    18-35906
husband and wife separately and the marital
community composed thereof,                     D.C. No. 2:18-cv-00507-JCC

                Plaintiffs-Appellants,
                                                MEMORANDUM*
 v.

MERCHANTS CREDIT CORPORATION,
a Washington state corporation; JASON
WOEHLER, on belief, a single man,

                Defendants-Appellees.

                   Appeal from the United States District Court
                     for the Western District of Washington
                  John C. Coughenour, District Judge, Presiding

                          Submitted November 6, 2019**
                              Seattle, Washington

Before: GOULD and NGUYEN, Circuit Judges, and PRESNELL,*** District
Judge.


      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
      ***
            The Honorable Gregory A. Presnell, United States District Judge for
the Middle District of Florida, sitting by designation.
        The Anglins appeal the judgment of the district court dismissing some of

their claims on the basis of res judicata and one of their claims on the merits. We

have jurisdiction pursuant to 28 U.S.C. § 1291. We affirm in part and reverse in

part.

        The district court erred in dismissing the Fair Debt Collection Practices Act

(“FDCPA”), Consumer Protection Act (“CPA”), and negligence claims on the

basis of res judicata. Under Washington law, the doctrine of res judicata applies

where a prior judgment “concurs in identity” with a subsequent action with respect

to: “(1) subject matter; (2) cause of action; (3) persons and parties; and (4) the

quality of the persons for or against whom the claim is made.” Feminist Women’s

Health Ctr. v. Codispoti, 63 F.3d 863, 867 (9th Cir. 1995) (quoting Rains v. State,

674 P.2d 165, 168 (Wash. 1983) (en banc)). Res judicata applies to matters

actually litigated as well as those that could and should have been litigated. See id.

        The FDCPA claim and the derivative claims (“the federal court claims”)

brought by the Anglins in federal court had a different factual basis than the state

court claims. The events underlying the federal court claims occurred during the

state court litigation. The federal court claims could have merit even though the

state court claims did not. See 15 U.S.C. § 1692f(1).

        The district court noted that the Anglins could have amended their claim in

state court in order to include the claim that arose during the state court litigation.


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However, “a judgment upon one cause of action does not bar suit upon another

cause which is independent of the cause which was adjudicated.” Seattle-First

Nat’l Bank v. Kawachi, 588 P.2d 725, 728 (Wash. 1978). In this case, the federal

court claims arose out of an entirely separate transaction that, while related in

subject matter, was otherwise independent of the claims adjudicated in state court.

See id. at 728. The Anglins had no obligation to seek an amendment to their

complaint alleging these new claims, and those claims are not barred on the basis

of res judicata.

      The district court did not err in dismissing the Equal Credit Opportunity Act

(“ECOA”) claim. The district court dismissed the ECOA claim on the merits. We

affirm its decision. While the district court rightly decided that the ECOA claim

was meritless, it erred in finding that the ECOA claim was not barred on the basis

of res judicata.

      Had the Anglins not voluntarily dismissed their ECOA claim in state court,

they could have (and should have) adjudicated it there. It involved the same facts

as their state court FDCPA claim. At issue in the ECOA claim was whether the

collection action improperly attempted to hold each spouse liable for the other’s

debt. That issue was closely related to issues actually decided by the state court. It

was not independent of the state law claim. See Kawachi, 588 P.2d at 728.




                                           3
      As for the merits of the ECOA claim, the Anglins failed to allege that the

Defendants were creditors under the ECOA. Even if the Defendants were creditors

for purposes of the ECOA, collection activities related to defaulted debt are

exempted from the ECOA. 15 U.S.C. § 1691(d)(6). Accordingly, the ECOA claim

lacks merit.

      AFFIRMED IN PART, REVERSED IN PART, AND REMANDED

FOR FURTHER PROCEEDINGS CONSISTENT HEREWITH.




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