Baker, Mitzi v. Potter, John E. ( 2006 )

UNPUBLISHED ORDER
Not to be cited per Circuit Rule 53
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Submitted April 6, 2006*
Decided April 7, 2006
Before
Hon. WILLIAM J. BAUER, Circuit Judge
Hon. RICHARD A. POSNER, Circuit Judge
Hon. DIANE P. WOOD, Circuit Judge
No. 05-3713
MITZI BAKER, Appeal from the United States District
Plaintiff-Appellant, Court for the Northern District of Illinois,
Eastern Division
v.
No. 04 C 8004
JOHN E. POTTER, United States
Postmaster General, George W. Lindberg,
Defendant-Appellee. Judge.
ORDER
Mitzi Baker sued the United States Postal Service (the “Post Office”) under
Title VII for breaching a settlement agreement and for retaliating against her for
complaining about alleged discriminatory practices. The district court dismissed
the complaint on the pleadings, Fed. R. Civ. P. 12(c), concluding that Baker’s claim
for breach was precluded because it had already been decided in a previous
litigation and that her claim for retaliation had not been exhausted. We affirm.
*
After an examination of the briefs and the record, we have concluded that
oral argument is unnecessary. Thus, the appeals are submitted on the briefs and
the record. See Fed. R. App. P. 34(a)(2).
No. 05-3713 Page 2
We review a dismissal on the pleadings de novo, and take as true the facts
alleged in the complaint. N. Ind. Gun & Outdoors Shows, Inc. v. South Bend, 163
F.3d 449, 452 (7th Cir. 1998). Baker brought several complaints against the Post
Office in the past, which the parties eventually had agreed to settle. Under the
settlement, Baker resigned from her position and dismissed her grievances. In
return, the Post Office paid her $200,000 and gave her a positive reference for her
upcoming job search. The parties also exchanged letters in which the Post Office
further agreed as part of the settlement to “expunge all negative references” from
her employment file. In the present lawsuit before Judge Lindberg, Baker claims
that the Post Office allegedly breached the settlement when it failed to remove at
least some of these negative references. She believes that the Post Office left these
references in her file in retaliation to sabotage her future job prospects.
In a previous lawsuit before Judge Filip that she filed after the settlement,
Baker complained that the Post Office had discriminated against her. See Baker v.
Potter, No. 02 C 525, 2005 WL 843169 (N. D. Ill. Jan. 20, 2005) aff’d 153 F.App’x.
393 (7th Cir. 2005) (unpublished order). Judge Filip granted the Post Office’s
motion for summary judgment and concluded that the Post Office had not
discriminated against Baker. Judge Filip also ruled on “alternate and independent
grounds” that even if the Post Office had discriminated, the general release in the
settlement agreement prevented Baker from bringing her claims. Id. at *14. Judge
Filip reasoned that the release was enforceable because the Post Office had not
breached the settlement agreement, but this reasoning applied only to his alternate
holding. Id. at *17 n.13.
The Post Office filed a motion to dismiss Baker’s current lawsuit on the
pleadings under Federal Rule of Civil Procedure 12(c). It argued that collateral
estoppel barred Baker’s claim for breach because Judge Filip had already resolved
that issue in favor of the Post Office. See Baker, 2005 WL 843169, at *17 n.13. The
Post Office also argued that Baker had not exhausted her retaliation claim with the
EEOC. The district court agreed with both contentions.
We agree with the district court that Baker’s claim that the Post Office
breached the settlement agreement is barred, not because of issue preclusion, but
under the related doctrine of claim preclusion. See Wilhelm v. Milwaukee, 325 F.3d
843, 846 (7th Cir. 2003) (“We can affirm a district court’s decision on any sufficient
basis supported in the record.”) Issue preclusion, also called collateral estoppel,
bars a party from relitigating the same issue that was necessary to a prior final
judgment. Wash. Group Int’l., Inc. v. Bell, Boyd & Lloyd LLC, 383 F.3d 633, 636
(7th Cir. 2004). Issue preclusion is not applicable in this case because the issue of
breach was resolved as part of an alternate holding in the previous case.
“[H]oldings in the alternative, either of which would independently be sufficient to
support a result, are not conclusive in subsequent litigation with respect to either
No. 05-3713 Page 3
issue standing alone.” Peabody Coal Co. v. Spese, 117 F.3d 1001, 1008 (7th Cir.
1997) (en banc); see Lisa Lee Mines v. Director, Office of Workers’ Comp. Programs,
86 F.3d 1358, 1363 (4th Cir. 1996); Restatement (Second) of Judgments § 27 cmt. i
(1982). Furthermore, Baker maintains that she never raised the issue of breach in
the case before Judge Filip; according to her, Judge Filip decided the Post Office did
not breach without her having litigated the issue.
Nevertheless, Baker’s claim for breach of the settlement agreement is barred
by claim preclusion, also called res judicata, which prevents a party from raising a
claim or defense that was or could have been raised in a previous proceeding.
Wilhelm, 325 F.3d at 846. Claim preclusion requires: 1) the previous action
proceeded to a final judgement on the merits, 2) an identity of the cause of action,
and 3) an identity of the parties and privies. Wilhelm, 325 F.3d at 846. There can
be no dispute about the first and third factors as the first action before Judge Filip
was between the same two parties as the present case and proceeded to a final
judgment that was affirmed on appeal, Baker v. Potter, 153 F.App’x. 393 (7th Cir.
2005).
The only question is whether there is an identity of causes of action. For
there to be an identity between causes of action, the two suits must arise from “a
single core of operative facts.” Roboserve, Inc. v. Kato Kagaku Co., Ltd., 121 F.3d
1027, 1034 (7th Cir. 1997); Prochotsky v. Baker & McKenzie, 966 F.3d 333, 335 (7th
Cir. 1992). Claims and defenses arising from the same set of factual allegations
must be joined. Roboserve, Inc., 121 F.3d at 1034; Welch v. Johnson, 907 F.2d 714,
720-22 (7th Cir. 1990). In the case before Judge Filip, the Post Office argued that
the settlement agreement barred Baker’s action. Although she had the opportunity
to argue that the settlement release was unenforceable due to the breach she now
claims in this case, Baker chose not to raise that claim. But Baker was required to
present all of her claims and defenses regarding the settlement in the earlier action.
Welch, 907 F.2d at 722. Baker insists that she could not have raised the breach
claim before Judge Filip because it was pending before the EEOC, and she believed
that she needed to await the EEOC’s decision before she could broach the subject.
But if the Post Office questioned whether she had exhausted in that case, she could
(and should) have asked the court for a stay pending the resolution of the matter
before the EEOC. See, e.g., Owens v. Kaiser Found. Health Plan, Inc., 244 F.3d 708,
714-15 (9th Cir. 2001) (“Title VII claims are not exempt from the doctrine of res
judicata where plaintiffs have neither sought a stay from the district court for the
purpose of pursuing Title VII administrative remedies nor attempted to amend
their complaint to include their Title VII claims.”) Thus, Baker’s failure to raise her
claim of breach of the settlement agreement in the previous lawsuit precludes her
from doing so now. See, e.g., Welch, 907 F.2d at 721-22 (applying res judicata to
Title VII claim when plaintiff failed to raise Title VII as a defense in prior case that
arose from same set of facts).
No. 05-3713 Page 4
As for her retaliation claim under Title VII, Baker contends that she was not
required to exhaust because it was reasonably related to the claim for breach that
she presented to the EEOC. A Title VII plaintiff can bring any claim that was
included in the complaint filed with the EEOC as well as those that are “reasonably
related” to the allegations in complaint. Geldon v. S. Milwaukee Sch. Dist., 414
F.3d 817, 819 (7th Cir. 2005). But if the retaliation claim is reasonably related to
the claim for breach, then it is also barred by claim preclusion because it would be
based on the same core facts as the breach claim. If, on the other hand, the claims
are not reasonably related, then she failed to exhaust the retaliation claim before
the EEOC as the district court ruled.
Finally, Baker argues that because the district court reviewed documents
other than the pleadings, it should have converted the Post Office’s motion under
Federal Rule of Civil Procedure 12(c) to a motion for summary judgment and
allowed her time for discovery. Under Rule 12(c), the court can consider documents
attached to the pleadings, including letters and contracts. N. Ind. Gun & Outdoor
Shows, Inc., 163 F.3d at 453-54. In making its decision, the district court relied
only on the contract that was attached to Baker’s complaint and on Judge Filip’s
decision, of which the court properly took judicial notice. Because the district court
did not (nor do we) rely on any documents beyond those attached to the pleadings, it
was not necessary to consider the Post Office’s motion as one for summary
judgment.
Accordingly, the district court’s decision is AFFIRMED.