In the
United States Court of Appeals
For the Seventh Circuit
No. 07-2932
K EVIN G ROESCH, G REG S HAFFER, and SCOTT A LLIN ,
Plaintiffs-Appellants,
v.
C ITY OF S PRINGFIELD, ILLINOIS,
Defendant-Appellee.
Appeal from the United States District Court
for the Central District of Illinois.
No. 04 cv 3162—Jeanne E. Scott, Judge.
A RGUED JANUARY 14, 2011—D ECIDED M ARCH 28, 2011
Before B AUER, W OOD , and H AMILTON, Circuit Judges.
H AMILTON, Circuit Judge. The district court in this race
discrimination case properly granted summary judgment
for the defendant employer based on law applicable at the
time. In this appeal, however, we rely on the retroactive
effect of the Lilly Ledbetter Fair Pay Act of 2009 to reverse
summary judgment in part and allow appellants to pursue
their claims of race discrimination under Title VII of the
2 No. 07-2932
Civil Rights Act of 1964 and the Equal Protection Clause of
the Fourteenth Amendment.
I. Factual and Procedural Background
We review a district court’s grant of summary judgment
de novo. Antonetti v. Abbott Laboratories, 563 F.3d 587, 591
(7th Cir. 2009). “We view the record in the light most
favorable to the non-moving party and draw all reasonable
inferences in that party’s favor.” Id., quoting Darst v.
Interstate Brands Corp., 512 F.3d 903, 907 (7th Cir. 2008).
A. The Plaintiff Officers
All three plaintiff-appellants—Kevin Groesch, Greg
Shaffer, and Scott Allin—are white officers who were in
good standing with the City of Springfield police depart-
ment when they voluntarily resigned. At the times of their
resignations, officers seeking reemployment were required
to go through the hiring process for new police officers.
Following successful completion of the process, officers
were placed on an eligibility roster to await vacancies in
the police department, and hired based on their rank on
the roster. Rehired officers were required to reenter the
force as entry-level officers in terms of pay, benefits, and
seniority.
All of the appellants were subject to these regulations.
Kevin Groesch was a police officer with the department for
seven and a half years before resigning in 1988. When he
later inquired about returning to the department, he was
No. 07-2932 3
told he would have to go through the hiring process for
new officers because his sixty day leave of absence had
expired. After reapplying to the police department and
awaiting reemployment from 1989 through 1996, Groesch
was rehired by the department as an entry-level patrol
officer in 1996. When Greg Shaffer resigned from the police
department in 1987, he had worked there for seven years.
He went through the rehiring process and returned to the
department in 1993 as an entry-level officer, with no credit
for his earlier years of service. Scott Allin resigned in 1986
after six years of service with the department. After six
months away, he attempted to rejoin but was told he
needed to reapply. Allin was eventually selected from the
eligibility roster in 1989 and returned to work with no
credit for his earlier years of service.
B. The “Schluter Ordinance” and State Court Litigation
The three appellants base their race discrimination claim
on the different treatment of Officer Donald Schluter, an
African-American officer who voluntarily resigned in
November 1999 after five years with the department. When
Schluter sought to return after a brief absence, he was not
required to start over. The chief of police spoke with a city
alderman, and on March 28, 2000, the Springfield City
Council enacted the “Schluter Ordinance,” which specifi-
cally granted Officer Schluter a retroactive leave of absence
to allow him to return with credit for his years of service as
an officer. The “whereas” clauses in the Schluter Ordinance
listed a variety of reasons for the ordinance, including an
interest in diversity in police ranks. After the ordinance
4 No. 07-2932
was enacted, Officer Schluter returned to his position as a
police officer without going through the formal hiring
process, and he was hired at the same rate of pay he was
earning when he resigned.1
After the Schluter Ordinance was enacted, the local
police union brought a lawsuit in state court against the
City and Officer Schluter claiming it was unconstitutional,
unreasonable, discriminatory, and an abuse of discretion.
The state trial court found in favor of the union, and for a
time the ordinance was invalidated. On appeal, however,
the Illinois Appellate Court reversed and reinstated the
ordinance, concluding that the union lacked standing.
The appellants then wrote to the chief of police request-
ing that the City give them equal treatment and credit
them with their earlier years of service to the department,
but their request was ignored. On April 3, 2003, the
appellants filed a new state court lawsuit claiming dispa-
rate treatment under the equal protection clause in Article
1, Section 2 of the Illinois Constitution. The state court
action was dismissed on statute of limitations grounds in
a judgment entered on November 10, 2003, and that
decision was affirmed by the Illinois Appellate Court on
July 22, 2004.
1
This opinion should not be interpreted as expressing any view
on the ultimate merits of appellants’ race discrimination claims,
including possible justifications for the Schluter Ordinance or
differences between his situation and appellants’ resignations
and returns. We address only the statute of limitations and res
judicata issues actually before us.
No. 07-2932 5
C. District Court Proceedings
The appellants then filed this lawsuit in federal district
court on July 27, 2004. In an order dated February 1, 2005,
the district court denied the City’s motion to dismiss. The
court relied in part on the “paycheck accrual” rule for
determining timeliness of claims in pay discrimination. See
Hildebrandt v. Illinois Dept. of Natural Resources, 347
F.3d 1014 (7th Cir. 2003); Reese v. Ice Cream Specialties,
Inc., 347 F.3d 1007 (7th Cir. 2003). The district court con-
cluded that each paycheck from the police department
amounted to a separate and distinct discriminatory act
from which the officers could bring separate claims. On
December 29, 2006, the district court denied the City’s
motion for summary judgment as to the appellants’ claims
arising out of paychecks received after the earlier state
court decision. The City’s motion was granted with respect
to claims arising prior to the state court decision of Novem-
ber 10, 2003, which the district court determined were
barred by the doctrine of res judicata, or claim preclusion.
The district court also dismissed with prejudice Officer
Shaffer’s claim for monetary damages accruing prior to
January 19, 2005, the date on which he had filed for
bankruptcy protection.
On May 29, 2007, however, the Supreme Court decided
Ledbetter v. Goodyear Tire & Rubber Co., 550 U.S. 618 (2007),
which rejected the paycheck accrual rule and found that
the plaintiff’s claims of sex discrimination in pay were
time-barred. In an order dated July 11, 2007, the district
court granted the City’s motion for summary judgment as
to all remaining claims based on Ledbetter’s rejection of
6 No. 07-2932
the paycheck accrual rule. As the district court had con-
cluded in its earlier opinion, the original adverse discrimi-
nation decision was in December 2002, when the appellants
were denied the same treatment that Officer Schluter
received. Under Ledbetter, the appellants needed to file
their discrimination charge with the Equal Employment
Opportunity Commission (EEOC) within 300 days from
that decision.2 The district court found that the appellants’
Title VII claims were untimely because they did not file
with the EEOC until March 2, 2004. The district court also
concluded that while the appellants filed their Section 1983
claims in a timely manner, during the applicable two-year
statute of limitations period, the Section 1983 claims were
barred by res judicata because they arose from the same set
of operative facts as the state court action and could have
been brought as part of that earlier lawsuit. While this
appeal was pending, Congress enacted the Lilly Ledbetter
Fair Pay Act in 2009.
II. The Ledbetter Decision and the Lilly Ledbetter Fair Pay
Act of 2009
The appellants argue that the Ledbetter Act requires that
the judgment of the district court be reversed and that,
because of the Ledbetter Act, the officers’ Title VII and
equal protection claims are not barred as untimely. We
2
Title VII claims must be filed within 180 or 300 days after the
allegedly discriminatory act, depending on the state. In Illinois,
the charging period is 300 days. See Hall v. Bodine Elec. Co., 276
F.3d 345, 352-53 (7th Cir. 2002); 42 U.S.C. § 2000e-5(e)(1).
No. 07-2932 7
agree, except with respect to the appellants’ claims for acts
of discrimination before the state court judgment was
entered on November 10, 2003, which we conclude are still
barred by res judicata.
A. The Title VII Claims
The district court properly applied the Supreme Court’s
decision in Ledbetter to grant summary judgment for the
City on appellants’ Title VII claims. The facts of Ledbetter
are now well known. Plaintiff Lilly Ledbetter claimed sex
discrimination in pay in violation of Title VII and the Equal
Pay Act of 1963, 29 U.S.C. § 206(d). She asserted that she
had received negative performance evaluations because of
her sex and that her pay continued to be affected by those
past performance reviews. See Ledbetter, 550 U.S. at 622.
Because each of the relevant evaluations occurred much
more than 180 days before Ms. Ledbetter filed her EEOC
charge, she relied on the paycheck accrual rule to show
that her claims were timely. She argued that each time she
was paid less than her similarly situated male colleagues as
a result of the discriminatory evaluations, the payment was
a separate and discrete wrong that triggered a new Title
VII limitations period. Id. at 625. The Supreme Court
rejected this argument and the paycheck accrual rule,
holding that Ms. Ledbetter could not sue based solely on
the present effects of a past discriminatory pay-setting
decision that occurred outside of the limitations period. Id.
at 621.
8 No. 07-2932
Like Ms. Ledbetter, the appellants relied on the paycheck
accrual rule to bring their claims. They argued that each
time they received a paycheck, they received less than they
would have received if they had been treated like Officer
Schluter, the returning African-American police officer.
Following Ledbetter, the district court had no choice but to
dismiss the appellants’ Title VII claims.
Congress responded to the Ledbetter decision by enacting
the Lilly Ledbetter Fair Pay Act of 2009, while this appeal
was pending. The Act amends Title VII of the Civil Rights
Act of 1964 by providing that the statute of limitations for
filing an EEOC charge alleging pay discrimination resets
with each paycheck affected by a discriminatory decision.
More specifically, the Act provides that an “unlawful
employment practice” occurs in the following situations:
(1) “when a discriminatory compensation decision or other
practice is adopted,” (2) “when an individual becomes
subject to a discriminatory compensation decision or other
practice,” and (3) “when an individual is affected by
application of a discriminatory compensation decision or
other practice, including each time wages, benefits, or
other compensation is paid, resulting in whole or in part
from such a decision or other practice.” 42 U.S.C. § 2000e-
5(e)(3)(A).
Congress took the unusual step of expressly providing
that the Ledbetter Act applies retroactively to all claims
pending on May 28, 2007 or later. Pub. L. 111-2, § 6. The
appellants’ Title VII claims are covered by the Ledbetter
Act because they allege “discriminatory compensation
decisions” and are based on the payment of wages result-
ing from those decisions.
No. 07-2932 9
The City has not offered any persuasive basis for avoid-
ing application of the Lilly Ledbetter Fair Pay Act.
First, the City argues that each paycheck the officers
receive is determined by a “seniority pay system” and
that a seniority pay system is a not a “discriminatory
compensation decision or other practice” as contemplated
by the Ledbetter Act. The problem is that the officers
do not contend that the seniority pay system is inherently
discriminatory, nor do they need to do so to satisfy
the Ledbetter Act’s requirements. A facially neutral
compensation system may still be applied in a discrimina-
tory manner. That is why the Ledbetter Act requires only
“a discriminatory compensation decision or other prac-
tice,” not an intrinsically discriminatory compensation
system. It is enough to allege, as the officers do, that
the City’s decisions as to who received prior service
credit within the existing seniority system were
motivated by race. The City’s seniority argument fails to
come to grips with the fact that it changed the
seniority system for Officer Schluter, and only for him.
The City’s “neutral seniority system” argument attempts
to sidestep both the language of the Act and the heart
of the matter alleged by the appellants—that the City
refused to recognize the white officers’ prior service
under the seniority system while doing so for a black
officer.
The City also relies on the first Supreme Court case to
address the Ledbetter Act, AT&T Corp. v. Hulteen, 129 S.
Ct. 1962 (2009). Hulteen was a pregnancy discrimination
case in which the plaintiffs challenged the calculation
10 No. 07-2932
of their pension benefits based on differential treatment
of pregnancy leaves taken decades earlier, before enact-
ment of the Pregnancy Discrimination Act. The Supreme
Court held that the Title VII protection of seniority systems
insulated th e defendan ts from liability based
on retroactive application of the Pregnancy Discrimination
Act. See 42 U.S.C. § 2000e-2(h). The Supreme Court
also rejected an argument based on the Ledbetter
Act, concluding that the defendants’ treatment of preg-
nancy leave had not been unlawful at the time and
that the defendants could apply their lawful
seniority system. 129 S. Ct. at 1973. Hulteen does not
help the City because the issue here is not a previously
lawful seniority system but only the timeliness of
claims based on an allegedly discriminatory decision
to treat officers differently based on their race. As
the district court concluded in its December 9, 2006 order,
the appellants have offered a prima facie case that
they were subjected to a discriminatory compensation
decision. This is precisely the kind of decision covered
by the Ledbetter Act.
Finally, the City seems to argue that this case can
b e d is t in gu is h e d from Led better based on a
supposed difference between race discrimination and
sex discrimination, or the factual differences between
discriminatory performance evaluations and the policy
choice reflected in the Schluter Ordinance. These argu-
ments miss the point of both the Supreme Court’s broad
rejection of the paycheck accrual rule in Ledbetter and
the even broader legislative response in the Ledbetter
Act. The district court’s grant of summary judgment on
No. 07-2932 11
the Title VII claims after November 10, 2003 must be
reversed.3
B. The Equal Protection Claims under Section 1983
The appellants’ race discrimination claims under the
Equal Protection Clause of the Fourteenth Amendment,
brought under 42 U.S.C. § 1983, present some additional
legal wrinkles. They filed those claims within the applica-
ble two-year limit measured from the denial of their
request for the same treatment that Officer Schluter
received. But their equal protection claims were dismissed
on res judicata grounds. In the absence of the paycheck
accrual rule, the appellants each had only one discrimina-
tion cause of action that should have been asserted in their
earlier and unsuccessful state court action.
Appellants argue, and we agree, that in the wake of the
Ledbetter Act, they should be able to rely on the paycheck
accrual rule to pursue their equal protection claims that
3
The City’s reliance on Delaware State College v. Ricks, 449 U.S.
250 (1980) (where plaintiff failed to file a timely charge after
denial of tenure), and United Air Lines, Inc. v. Evans, 431 U.S. 553,
558 (1977) (“[a] discriminatory act which is not made the basis
for a timely charge . . . is merely an unfortunate event in history
which has no present legal consequences”), to argue that the
paycheck accrual rule should not apply, is not at all convincing
in light of the Ledbetter Act. Furthermore, these cases were
decided well before Hildebrandt and Reese, where we held that
the paycheck accrual rule applied to pay discrimination cases
under Title VII.
12 No. 07-2932
arose after dismissal of the state court action. The paycheck
accrual rule avoids the problem of res judicata because
each paycheck reflecting the allegedly discriminatory
decision gives rise to a distinct cause of action. We con-
clude that there is no principled reason for applying the
paycheck accrual theory to claims arising under Title VII
but not to those arising under 42 U.S.C. § 1983. As the
district court concluded in denying the City’s motion to
dismiss pre-Ledbetter, Hildebrandt and Reese, our cases
applying the paycheck accrual rule in the Title VII context,
extend logically to equal protection claims arising under
Section 1983. If it was not already clear that Hildebrandt
extended the paycheck accrual rule to pay discrimination
claims under Section 1983, we hold here that paychecks
reflecting a past discriminatory compensation practice
create fresh causes of action under Section 1983, just as
they do under Title VII after the Ledbetter Act.
The Supreme Court articulated what became known as
the “paycheck accrual rule” in Bazemore v. Friday, 478 U.S.
385 (1986), a case concerning the continued application of
a racially discriminatory pay regime originally imple-
mented prior to Title VII’s enactment. The Bazemore Court
concluded: “Each week’s paycheck that delivers less to a
black than to a similarly situated white is a wrong action-
able under Title VII.” Id. at 395 (in a concurrence by Justice
Brennan, joined by all other Members of the Court).
Initially, this circuit struggled to reconcile Bazemore with
earlier Supreme Court cases emphasizing the difference
between a discrete act and its later harmful effects. See,
e.g., Webb v. Indiana National Bank, 931 F.2d 434, 437-38 (7th
Cir. 1991) (noting the difficulty in reconciling Bazemore
No. 07-2932 13
with earlier decisions like Delaware State College v. Ricks).
Early on, this circuit and others understood paycheck
discrimination claims like those in Bazemore as an out-
growth of the “continuing violation” doctrine. See
Hildebrandt, 347 F.3d at 1025-26 (discussing Bazemore and
its progeny), citing Cardenas v. Massey, 269 F.3d 251, 257
(3d Cir. 2001). We observed that, “Drawing the line
between something that amounts to a ‘fresh act’ each day
and something that is merely a lingering effect of an
earlier, distinct, violation is not always easy.” Hildebrandt,
347 F.3d at 1026, quoting Pitts v. City of Kankakee, 267 F.3d
592, 595 (7th Cir. 2001).
In 2002, the Supreme Court decided National Railroad
Passenger Corp. v. Morgan, 536 U.S. 101 (2002), which
distinguished paycheck discrimination from the continuing
violation theory and helped clarify our own treatment of
the paycheck accrual rule articulated in Bazemore. “In
Morgan, the Supreme Court expressly relied on its state-
ment in Bazemore regarding each paycheck paid at a
discriminatory rate as an example of an actionable discrete
act or single occurrence, even when it has a connection to
other acts.” Hildebrandt, 347 F.3d at 1027, citing Morgan, 536
U.S. at 111 (internal quotation marks omitted). Morgan held
that “discrete, discriminatory acts are not actionable if time
barred, even when they are related to acts alleged in timely
filed charges.” Morgan, 536 U.S. at 113. The Court found
that, “Each discrete discriminatory act starts a new clock
for filing charges alleging that act. The charge, therefore,
must be filed within the 180- or 300-day time period after
the discrete discriminatory act occurred.” Id.
14 No. 07-2932
Following Morgan, Hildebrandt and Reese firmly estab-
lished in our circuit that under Title VII, a new cause of
action for pay discrimination arose every time a plaintiff
received a paycheck resulting from an earlier discrimina-
tory compensation practice occurring outside the statute of
limitations period. See Reese, 347 F.3d at 1013-14, citing
Hildebrandt, 347 F.3d at 1028. While we stated no clear
holding in Hildebrandt that the paycheck accrual rule
extended to pay discrimination claims under Section 1983,
we concluded that the Supreme Court’s decision in Mor-
gan, while focused on the timeliness of Title VII claims, also
applied to Section 1983 claims: “The Supreme Court’s
ruling in [Morgan], although discussing the continuing
violation doctrine in the Title VII context, applies equally
to § 1983 cases.” Hildebrandt, 347 F.3d at 1036 n.18. Other
circuits have reached similar conclusions. See, e.g., Sharpe
v. Cureton, 319 F.3d 259, 267 (6th Cir. 2003) (“We can find
no principled basis upon which to restrict Morgan to Title
VII claims, and we therefore conclude that the Supreme
Court’s reasoning must be applied to the . . . § 1983
claims.”); RK Ventures, Inc. v. City of Seattle, 307 F.3d
1045, 1061 (9th Cir. 2002) (applying Morgan to Section 1983
claims). We see no reason—and the City offers no rea-
son—why we would treat a paycheck as a “discrete
discriminatory act” that triggers a new limitations period
under Title VII but not under Section 1983 for the purpose
of pay discrimination claims.
The district court found that the appellants had filed
timely Section 1983 claims, within the applicable two-year
statute of limitations, but that, under Ledbetter, the equal
protection claims were barred by res judicata because they
No. 07-2932 15
could have been brought within the state court action. In
fact, the Ledbetter decision focused specifically on Ms.
Ledbetter’s Title VII claims and did not specify the applica-
bility of its holding to constitutional claims under Section
1983. But if Ledbetter was understood to extend logically to
Section 1983 claims, as, for example, we had earlier under-
stood Morgan’s Title VII reasoning to extend to Section
1983 claims, see, e.g., Evans v. City of Chicago, 2007 WL
4219415, at *2 (N.D.Ill. Nov. 29, 2007) (applying Ledbetter
to plaintiff’s § 1983 claims), then we see no reason that
the Ledbetter Act would not now restore our pre-Ledbetter
precedent and allow us to extend the paycheck accrual rule
to Section 1983 claims. See, e.g., Shockley v. Minner, 2009 WL
866792, at *1 (D. Del. Mar. 31, 2009) (With the Ledbetter
Act, “Congress has explicitly overruled the decision and
logic of the Ledbetter decision and thereby overruled the
Evans [v. City of Chicago] [Section 1983] decision.”).
Ledbetter and the Ledbetter Act leave some room for
confusion as to the scope of the paycheck accrual rule.
The Ledbetter decision explicitly applied only to Title
VII claims, though its reasoning clearly would have
extended to disparate pay claims under other
employment discrimination statutes. The Ledbetter Act
applies explicitly to claims under Title VII, but also
to claims under the Americans with Disabilities Act,
the Rehabilitation Act, and the Age Discrimination in
Employment Act, none of which were specifically ad-
dressed by the Ledbetter Court. See Pub. L. No. 111-2.
Neither the Ledbetter decision nor the Ledbetter
Act addresses constitutional claims asserted under
16 No. 07-2932
Section 1983.4 In the absence of any clearer directive, we
believe the best course is to treat the Ledbetter Act as
removing the Ledbetter decision as an obstacle to following
our earlier precedents, which recognized the paycheck
accrual rule for all allegations of unlawful discrimination
in employee compensation. We hold that the paycheck
4
District courts have just begun to grapple with how broadly
the Ledbetter Act should be construed. See, e.g., Aspilaire v.
Wyeth Pharmaceuticals, Inc., 612 F. Supp. 2d 289, 303 n.6 (S.D.N.Y.
2009) (acknowledging, but declining to resolve, the fact that
“[t]he Act does not, by its terms, apply to cases brought under
§ 1981 . . . However, Title VII, to which the Act does expressly
apply, and § 1981 cases are frequently analyzed under the same
framework . . . Undoubtedly, answers to these questions will
soon emerge.”). Answers are emerging, and district courts are
coming to different conclusions. Compare Russell v. County of
Nassau, where the court concluded that claims for salary
discrimination under Title VI or Sections 1981, 1983, or 1985 are
governed by the Supreme Court’s analysis in Ledbetter. 696 F.
Supp. 2d 213, 230 (E.D.N.Y. 2010), citing Pub. L. No. 111-2
(“[A]lthough, in addition to Title VII, the Ledbetter Act
amended the Americans with Disabilities Act, the Rehabilitation
Act, and the Age Discrimination in Employment Act, it did not
amend Title VI, § 1981, § 1983 or § 1985.”), with Klebe v. Univer-
sity of Texas System, 649 F. Supp. 2d 568 (W.D. Tex. 2009)
(holding that the Ledbetter Act applies to reinstate employees’
pay discrimination claims under Texas Commission on Human
Rights Act), and Schengrund v. Pennsylvania State University, 705
F. Supp. 2d 425 (M.D.Pa. 2009) (declining to apply the reasoning
of Ledbetter to pay discrimination claims under the Pennsylvania
Human Relations Act when it no longer applies to Title VII
claims ).
No. 07-2932 17
accrual rule applies to pay discrimination claims under
Section 1983.
In a separate argument aimed at the equal protection
claims, the City argues, contrary to the district court’s
ruling, that the act of alleged discrimination occurred not
when the white officers asked the chief of police for equal
treatment but on March 29, 2000, when the City passed the
Schluter Ordinance. On this theory, the City argues that the
two-year statute of limitations period for appellants’ equal
protection claims expired on March 29, 2002. The City
argues that the Ledbetter Act “does not save otherwise
untimely claims outside the discriminatory compensation
context,” quoting Richards v. Johnson & Johnson, Inc., 2009
WL 1562952, at *9 (D.N.J. Jun. 2, 2009), and is thus not
applicable to the appellants’ claims. This argument fails for
three reasons. First, the language quoted from the Richards
case does not apply because appellants’ claims, unlike the
claims in Richards, are claims for discriminatory compensa-
tion. Second, the discriminatory compensation decision
actually alleged by the appellants and addressed by the
district court was not the passage of the Schluter Ordi-
nance. The white officers do not object to the City’s treat-
ment of Officer Schluter; they just want what they say
would be the same treatment. The allegedly discriminatory
decision therefore was the implicit denial of the appellants’
December 11, 2002 request for the same prior service credit
that was given to Schluter. See, e.g., Mikula v. Allegheny
County, 583 F.3d 181, 186 (3d Cir. 2009) (finding that the
failure of an employer to respond to a request for a raise
qualified as a “compensation decision” within the meaning
of the Ledbetter Act “because the result is the same as if
18 No. 07-2932
the request had been explicitly denied”). Third, even if the
City were correct on these points, the argument that the
statute of limitations has run on the original compensation
decision assumes rather than proves the inapplicability of
the paycheck accrual rule. The relevance of the argument
depends on whether or not the paycheck accrual rule
applies—the City obviously assumes it does not. Because
the rule applies for the reasons we have explained, a new
statute of limitations period began to run with each
paycheck. The district court’s grant of summary judgment
on the Section 1983 claims after November 10, 2003 is
reversed.
III. Preclusive Effect of State Court Decision
Finally, we consider whether the earlier state court
litigation precludes further litigation of appellants’ claims
even if they get the benefit of the paycheck accrual rule.
“The doctrine of [res judicata or] claim preclusion is
premised on the idea that, when a claim has been fully
litigated and come to judgment on the merits, finality
trumps.” Czarniecki v. City of Chicago, ___ F.3d ___, 2011 WL
181471, at *3 (7th Cir. Jan. 21, 2011). Because the earlier suit
in this case was a state court judgment, we look to Illinois
law to determine whether res judicata bars the appellants’
claims. Walsh Const. Co. of Illinois v. Nat’l Union Fire Ins.
Co. of Pittsburgh, Pennsylvania, 153 F.3d 830, 832 (7th
Cir. 1998). In Illinois, res judicata applies when: (1) there
is a final judgment in the first suit; (2) there is identity of
the causes of action (identified by a set of “operative
facts”); and (3) there is an identity of parties (directly
No. 07-2932 19
or through privity of interest). Id.; Czarniecki, 2011
WL 181471, at *3. The district court properly decided that
res judicata barred recovery for claims arising before
the date of the final judgment in the state court
suit—November 10, 2003. If the appellants had been
successful in the state court case, they could have recov-
ered for damages up until November 10, 2003.
The City argues that the appellants’ later claims are also
barred by res judicata even if the paycheck accrual rule
applies. We disagree. As discussed above, following the
Ledbetter Act, we recognize that each paycheck resulting
from the original discriminatory act is a separate cause
of action triggering its own statute of limitations. As
the district court found, these independent causes of
action do not share an “identity of cause of action” with
the state court action. They are allegedly “wrongful events
. . . separated by time and function” from the allegedly
discriminatory paychecks paid to the appellants before the
state court case was decided. Perkins v. Board of Trustees
of University of Illinois, 116 F.3d 235, 237 (7th Cir. 1997).
We should not be understood as opening the door to
endless re-litigation of allegedly discriminatory decisions
that affect compensation for many years. A critical point
here is that the state court did not rule on the merits of the
discrimination issue, but ruled only on statute of limita-
tions grounds. Therefore, there is no collateral estoppel or
issue preclusion problem that would prevent these plain-
tiffs from receiving a first decision on the merits of their
discrimination claims. See id. (holding that the university’s
prevailing in the first case on statute of limitations grounds
20 No. 07-2932
did not mean that there was issue preclusion or collateral
estoppel as to the plaintiff’s later claims of new discrimina-
tion). The appellants may thus proceed with their discrimi-
nation claims for allegedly discriminatory compensation
paid after November 10, 2003.
The appellants argue that the state court decision should
have no preclusive effect at all on their Title VII claims
because they had not yet received their EEOC
“right-to-sue” letter, so the Title VII claim could not have
been brought in their earlier state court suit. We rejected
essentially the same argument in Brzostowski v. Laidlaw
Waste Sys., Inc., 49 F.3d 337, 339 (7th Cir. 1995) (finding that
plaintiff “could have delayed the filing of his first suit or
requested that the court postpone or stay the first case.
What he cannot do, as he did here, is split causes of action
and use different theories of recovery as separate bases for
multiple suits.”); see also Huon v. Johnson & Bell, Ltd., 2010
WL 3404967, at *3 (N.D.Ill. Aug. 26, 2010) (“the Seventh
Circuit has addressed that precise issue and held that a
plaintiff cannot rely upon the fact that he has not yet
received a right-to-sue letter from the EEOC to escape the
effects of res judicata”). The appellants’ argument that they
could not bring their Title VII claims in state court is
meritless, and the state court decision must be given
preclusive effect for the appellants’ claims before Novem-
ber 10, 2003.
The judgment of the district court is A FFIRMED IN P ART,
with respect to the dismissal of all claims arising before
November 10, 2003 and with respect to Officer Shaffer’s
claims for monetary damages before January 19, 2005. In all
No. 07-2932 21
other respects the judgment is R EVERSED and the case is
R EMANDED for proceedings consistent with this opinion.
3-28-11