Cole v. Board of Trustees University of Illinois

• Decision Date: 16 August 2007
• Docket Number: No. 06-2161.,06-2161.
• Citation: 497 F.3d 770
• Parties: Gayle D. COLE, Plaintiff-Appellant, v. The BOARD OF TRUSTEES OF THE UNIVERSITY OF ILLINOIS, Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

497 F.3d 770

Gayle D. COLE, Plaintiff-Appellant, v. The BOARD OF TRUSTEES OF THE UNIVERSITY OF ILLINOIS, Defendant-Appellee.

No. 06-2161.

United States Court of Appeals, Seventh Circuit.

Argued January 10, 2007.

Decided August 16, 2007.

Kenneth T. Goldstein, Krislov & Associates, Chicago, IL, Michael C. Rosenblat (argued), Glenview, IL, for Plaintiff-Appellant.

Patrick S. Coffey (argued), Lord Bissell & Brook, Peter J. Meyer, Gardner, Biddle, Carton, Chicago, IL, for Defendant-Appellee.

Before POSNER, MANION, and SYKES, Circuit Judges.

MANION, Circuit Judge.

Gayle Cole ("Cole") filed suit in federal court against her employer, the Board of Trustees of the University of Illinois (the "Board"),¹ in 2002 alleging racial harassment pursuant to Title VII ("Cole I"). After the parties settled Cole I, the district court dismissed the case with prejudice. In July 2003, Cole filed a second suit in federal court against the Board asserting claims under the False Claims Act and the Illinois Whistleblower Reward and Protection Act (Cole II). Following the Board's motion, the district court granted the Board's motion and dismissed Cole II because it is barred by res judicata. Cole appeals, and we affirm.

I.

Cole worked as a pharmacist at a pharmacy run by the University of Illinois at Chicago. In 2002, Cole filed a complaint against the Board pursuant to Title VII, 42 U.S.C. § 2000e, et seq., alleging racial harassment. In her complaint, she asserted that "the effect of the practices complained of ... has been to deprive Gayle D. Cole of equal employment opportunities and otherwise adversely affect her status as an employee, because of her race and act of `Whistle Blowing.'" Cole further alleged:

The unlawful employment and retaliatory practices complained of ... commenced after the plaintiff, Gayle D. Cole, became aware and brought to the attention of the Defendant, the Defendant's violation of the Illinois Pharmacy Practice Act of 1987, the Illinois Wholesale Drug Distribution Licensing Act and the Drug Abuse Control Act....

Cole then set forth the acts in three subparagraphs. After the parties settled the case, on April 8, 2003, the district court dismissed Cole's complaint with prejudice with leave to reinstate within forty-five days. A final order of dismissal with prejudice was entered on October 2, 2003.

On July 11, 2003, Cole filed a qui tam action against the Board alleging violations of the False Claims Act, 31 U.S.C. §§ 3729, et seq., and the Illinois Whistleblower Reward and Protection Act, 740 ILCS 175/1, et seq.² In Counts I, II, III, and IV of her complaint, Cole asserted that the Board submitted false information and fraudulent claims to the state and federal government to obtain payment. In Counts V and VI, Cole alleged that the Board threatened, harassed, and discriminated against her because of her whistle-blowing activities. The Board moved to dismiss this case on grounds that it was barred by res judicata. The district court granted the Board's motion and dismissed the case with prejudice as to Cole and without prejudice as to the United States.

II.

On appeal, Cole argues that the district court improperly interpreted the res judicata test and wrongly concluded that her claims in Cole II were barred by res judicata. Specifically, Cole argues that the her Title VII claims asserted in Cole I and her whistleblower and false claims act claims asserted in Cole II are not based on the same factual allegations. We review a district court's dismissal of a case based on res judicata de novo.³ Andersen v. Chrysler Corp., 99 F.3d 846, 852 (7th Cir.1996).

"Under the doctrine of res judicata, `a final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.'" Highway J Citizens Group v. United States Dept. of Transp., 456 F.3d 734, 741 (7th Cir.2006) (quoting Allen v. McCurry, 449 U.S. 90, 94, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980)). There are three requirements for res judicata: "(1) an identity of the parties or their privies; (2) an identity of the causes of action; and (3) a final judgment on the merits." Id. "If these requirements are fulfilled, res judicata `bars not only those issues which were actually decided in a prior suit, but also all other issues which could have been raised in that action.'" Id. (citation omitted). There is identity of causes of action if the claim "emerges from the same core of operative facts as that earlier action." Id. (citation omitted). "[T]wo claims are one for purposes of res judicata if they are based on the same, or nearly the same, factual allegations." Herrmann v. Cencom Cable Assoc., Inc., 999 F.2d 223, 226 (7th Cir.1993) (citations omitted). In other words, "a subsequent suit is barred if the claim on which it is based arises from the same incident, events, transaction, circumstances, or other factual nebula as a prior suit that had gone to final judgment." Okoro v. Bohman, 164 F.3d 1059, 1062 (7th Cir.1999). Also, "[w]hile the legal elements of each claim may be different, the central factual issues are identical." Brzostowski v. Laidlaw Waste Sys., Inc., 49 F.3d 337, 339 (7th Cir.1995).

Cole contends that the district court improperly interpreted res judicata to "not only preclude[ ] those issues raised and decided in prior law suits, but also that could have been raised in a prior lawsuit." However, contrary to Cole's position, res judicata, in fact, precludes all issues that could have been raised. See Highway J Citizens Group, 456 F.3d at 741 (quoting Allen v. McCurry, 449 U.S. 90, 94, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980) ("[A] final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.")). Therefore, the district court employed the proper test.

Alternatively, Cole claims that while there is identity of parties and a final judgment, the third element of the res judicata test, i.e., the identity of causes of action, was not satisfied. Specifically, Cole argues that her whistleblower claims and her Title VII claim "are not based on the same factual allegations." She asserts that her civil rights claim involved some co-workers and a supervisor, whereas her whistleblower claim involved an administrative official and senior supervisors.

In her complaints, Cole did not specify who allegedly committed the unlawful acts against her, whether premised on race or as a result of her whistleblowing activity. Rather, she specifically stated in Cole I that the Board's unlawful employment and retaliatory practices were "because of her race and act of `Whistle Blowing.'" Cole also asserted in Cole I that the "unlawful and retaliatory practices" "commenced after [she] became aware and brought to the attention of the [Board], the [Board's] violation of the Illinois Pharmacy Practice Act of 1987, the Illinois Wholesale Drug Distribution Licensing Act and the Drug Abuse Control Act...." In Cole II, Cole alleged that she notified the Board of its unlawful practices and "[a]s a result of [her] lawful acts done by her on behalf and in furtherance of an action under the [false claims act claims], [she] has been threatened, harassed, and in other ways discriminated against in terms and conditions of her employment."

Her own allegations demonstrate that Cole sought recovery for the same injury in both actions—harassment and discrimination. The discrimination claims Cole asserted in Cole I and the whistleblower claims asserted in Cole II arise from the same operative facts, and therefore she could and should have asserted the whistleblower claims in Cole I. See Highway J Citizens Group, 456 F.3d at 741 (citing Allen v. McCurry, 449 U.S. 90, 94, 101 S.Ct. 411, 66 L.Ed.2d 308). As the district court aptly reasoned:

Both Complaints allege roughly the same series of events: the Board was engaged in wrongdoing, Cole notified the Board that she knew of the wrongdoing, and the Board harassed Cole. There is no indication that the Board's defrauding or harassing conduct described in the two suits were in any way distinct. Indeed, Cole even described the same illicit claim filing scheme in her first complaint and stated that the harassment was not only due to her race, but also her "act of "Whistle Blowing." These events provide the factual bases for the present and prior lawsuits [ ]. Cole could have, and should have, included her whistleblower claims in her prior lawsuits.

Cole v. Univ. of Ill., No. 03-4799-Civ (N.D. Ill. March 28, 2006). Accordingly, Cole's whistleblower claims are barred by res judicata.

Next, we review Cole's false claims act claims. Again, Cole argues that there is no identity of causes of actions between these claims and her first case because her Title VII claims in Cole I involved racial harassment by her coworkers and supervisors while she was at work, but her false claims act counts involved conduct between the Board and governmental health care programs. She argues that "[w]hat defendant did or did not do regarding plaintiff is irrelevant to her false claims act counts."

Whether all of the facts of one particular claim are relevant to another claim is not a fact considered when determining whether a later-brought claim is barred by res judicata. Rather, "[a] claim has identity with a previously litigated matter if it emerges from the same core of operative facts as that earlier action." Highway J Citizens Group, 456 F.3d at 741 (quoting Brzostowski, 49 F.3d at 338-39 (7th Cir.1995)). The Cole I complaint set forth operative facts that

[t]he unlawful employment and retaliatory practices complained of in paragraph 9 commenced after [Cole] became aware of and brought to the attention of the [Board], the [Board's] violation of the Illinois Pharmacy Practice Act of 1987, the Illinois Wholesale Drug Distribution Licensing Act and the Drug Abuse Control Act for...