In Rue v. K-Mart Corporation, 552 Pa. 13, 713 A.2d 82 (1998), the employer, K-Mart, dismissed Rue for stealing a bag of potato chips from the store. K-Mart then opposed Rue's application for unemployment benefits, asserting that her loss of employment had been the result of her willful misconduct, which rendered her ineligible for benefits. The Referee found that Rue did not steal potato chips and awarded her unemployment benefits. Rue then filed a defamation action, alleging that K-Mart had injured her reputation by telling other employees that she had stolen potato chips, a fact proven false in the unemployment proceeding. The trial court ruled that K-Mart was collaterally estopped from challenging the Referee's finding that Rue had not stolen a bag of potato chips. The jury awarded Rue approximately $ 1.5 million, and K-Mart appealed. The Supreme Court held that the Referee's findings in the unemployment proceeding were not entitled to preclusive effect in the defamation action. The Court found the issues in both proceedings to be identical, reasoning as follows: It is an issue of pure fact, concerning whether Rue did or did not steal a bag of potato chips. As such, the differences between the public policies of the Unemployment Compensation Law and the civil action for defamation are not relevant. A fact is a fact, regardless of public policy. Thus, we conclude that the first prong of the collateral estoppel test, identity of issues, is satisfied here. K-Mart, 552 Pa. at 19, 713 A.2d at 85. The Court held that a court need not apply collateral estoppel effect to an unemployment compensation proceeding because in an unemployment compensation proceeding, a Referee clearly did not allow parties to litigate issues in the manner available in a court of record. It noted that the Rules of Evidence did not apply, there was no procedure for prehearing discovery, and that the proceedings by definition were brief and informal.