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In a diversity case, the court must apply the collateral estoppel rules of the forum state . . . ; Costantini v. Trans World Airlines, 681 F.2d 1199, 1201 (9th Cir. 1982) (holding that 'a federal court sitting in diversity must apply the res judicata law of the state in which it sits'); Priest v. Am. Smelting & Ref. Co., 409 F.2d 1229, 1231 (9th Cir. 1969) ('Since federal jurisdiction in this case is based upon diversity of citizenship, the district court and this court must apply the substantive law of the forum state, . . . including the law pertaining to collateral estoppel.'); See Pardo v. Olson & Sons, Inc., 40 F.3d 1063, 1066 (9th Cir. 1994) and see also BBS Norwalk One, Inc. v. Raccolta, Inc., 117 F.3d 674, 677 (2d Cir. 1997) ('The governing law in this diversity case is that of New York, where the district court sits: specifically, New York's law on the collateral estoppel effect of an arbitration award.'). 

In Johnson v. United States, 576 F.2d 606, 613 (5th Cir. 1978), cert. denied, 451 U.S. 1018, 101 S.Ct. 3007, 69 L.Ed.2d 389 (1981), the ...

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