In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 20-1209
PETER DAZA,
Plaintiff-Appellant,
v.
STATE OF INDIANA, et al.,
Defendants-Appellees.
____________________
Appeal from the United States District Court for the
Southern District of Indiana, Indianapolis Division.
No. 1:18-cv-02951-JMS-MPB—Jane Magnus-Stinson, Judge.
____________________
ARGUED DECEMBER 4, 2020 — DECIDED JUNE 23, 2021
____________________
Before KANNE, WOOD, and SCUDDER, Circuit Judges.
WOOD, Circuit Judge. Peter Daza once worked for the Indi-
ana Department of Transportation (INDOT), but he was fired
in 2015. Believing that the agency took that step for discrimi-
natory and retaliatory reasons, he sued it in 2017. The district
court granted summary judgment for the defendants, how-
ever, and we affirmed its decision. See Daza v. Indiana, 941
F.3d 303 (7th Cir. 2019) (Daza I). That should have been the
2 No. 20-1209
end of things, but it was not. Days after the district court dis-
missed his first action, he filed the present case, which is iden-
tical except for the addition of a failure-to-rehire allegation.
The district court dismissed the new action on claim-preclu-
sion grounds, and we affirm.
I
Daza worked as a geologist for INDOT from 1993 until the
agency fired him on December 10, 2015. We described his job
in Daza I, 941 F.3d at 305–08, but those details are not pertinent
this time around. What matters is that Daza was convinced
that his firing was politically and racially motivated, and so in
2017 he sued INDOT and several of its officials. Invoking 42
U.S.C. §§ 1981 and 1983, the First and Fourteenth Amend-
ments, the Age Discrimination in Employment Act, 29 U.S.C.
§ 621 et seq., and the Americans with Disabilities Act, 42 U.S.C.
§ 12101 et seq., he alleged that INDOT and its officials had dis-
criminated against him based on race, color, age, and political
speech and had retaliated against complaints he made regard-
ing the alleged discrimination. (We refer to the defendants
collectively as INDOT.) Daza’s primary theory in the 2017
case involved the loss of his job.
Just 26 days after the district court granted summary judg-
ment in favor of the defendants in the 2017 case, Daza filed a
second action on September 25, 2018. That suit, which we will
call Daza II, is the one currently before us. In it, Daza again
alleges discrimination and retaliation based on race, color,
age, and political speech. He also contends that INDOT’s fail-
ure to rehire him for the vacancy left after INDOT dismissed
him was an independent act of discrimination and retaliation,
because INDOT filled his position with a young and inexpe-
rienced white man.
No. 20-1209 3
Although the claim in Daza I concerned Daza’s firing, he
did not limit himself to that event in his response to INDOT’s
Motion for Summary Judgment in that case. Relevant to this
appeal, Daza expressly contended in Daza I that INDOT’s fail-
ure to rehire him and its decision to hire an unqualified re-
placement proved that INDOT was attempting to cover up its
discrimination and retaliation against him.
Based on its decision in Daza I, which we had affirmed on
October 24, 2019, the district court granted summary judg-
ment in favor of INDOT in Daza II on January 10, 2020. Its
primary reason was that claim preclusion barred the second
case. In the alternative, the court found that summary judg-
ment was proper on the merits because Daza did not present
a cognizable failure-to-rehire claim. We agree that claim pre-
clusion blocks the second case, and so on that basis we affirm.
II
The doctrine of claim preclusion rests on the pragmatic in-
sight that one fair opportunity to litigate a claim is normally
enough. The logjam that would develop if people could take
second, third, or nth bites at the apple without restriction
would end up greatly delaying, or even denying, access to the
courts for people with new claims. By requiring people to
raise all theories that relate to a single claim in one proceed-
ing, dispute resolution is accomplished efficiently, people fo-
cus their efforts on the main event, and to the extent humanly
possible, both factfinding and legal analysis are accurate.
Those incentives and consequences are preserved by the
claim-preclusion doctrine, under which “a final judgment on
the merits bars further claims by parties or their privies based
on the same cause of action.” Montana v. United States, 440 U.S.
4 No. 20-1209
147, 153 (1979) (citing Cromwell v. County of Sac, 94 U.S. 351,
352 (1877)).
Federal courts apply the federal common law of claim pre-
clusion when the earlier decision was rendered by a federal
court. See Taylor v. Sturgell, 553 U.S. 880, 891 (2008). (When a
state court issues the earlier judgment, the full faith and credit
statute, 28 U.S.C. § 1738, governs the scope of preclusion. See
Marrese v. Am. Acad. of Orthopaedic Surgeons, 470 U.S. 373, 380
(1985).) Daza’s first case was adjudicated in federal court, and
so the preclusion rules now applicable are also federal. Claim
preclusion is appropriate when three criteria are met: (1) iden-
tity of parties, (2) identity of claims, and (3) a prior final judg-
ment on the merits. See generally Lucky Brand Dungarees, Inc.
v. Marcel Fashions Group, Inc., 140 S. Ct. 1589, 1594–95 (2020);
see also Perry v. Globe Auto Recycling, Inc., 227 F.3d 950, 952
(7th Cir. 2000).
In interpreting the scope of a claim for purposes of preclu-
sion, we are not limited to the words in the complaint; we in-
stead are examining the complaint to discern the basis of the
litigation. As the Supreme Court put it in Lucky Brand, we
must decide if the two claims “arise from the same transaction
… or involve a common nucleus of operative facts.” 140 S. Ct.
at 1595 (cleaned up). Anything falling within that common
nucleus, whether or not actually raised, falls within the scope
of the claim and is thus subject to claim preclusion in a later
case. In this respect, claim preclusion differs from its cousin,
issue preclusion. Issue preclusion applies only if the issue was
actually litigated and was necessary to the outcome of the
proceeding.
Daza does not dispute that his first lawsuit (Daza I) in-
volved the same parties and was resolved by a final judgment
No. 20-1209 5
on the merits. But he contends that the new litigation does not
fall within the scope of the claim adjudicated the first time
around. He failed to persuade the district court that this was
so, however. That court concluded that Daza did raise his fail-
ure-to-rehire claim in Daza I and, in any event, that claim falls
within the scope of the first claim. It pointed out that Daza
used INDOT’s decision to pass over him in favor of the
younger replacement as evidence of discrimination and retal-
iation, and that it explicitly addressed that point.
In the alternative, the court added that even if the failure-
to-rehire theory did not appear in so many words in the
pleadings, it fit within “the bigger picture of INDOT termi-
nating him and refusing to take him back.” In so holding, it
relied on Barr v. Board of Trustees of Western Illinois University,
796 F.3d 837 (7th Cir. 2015), which held that “a discrimination
claimant who is waiting for a right-to-sue letter on new claims
that are factually linked to an earlier suit” is not allowed to
split his claims, id. at 840. He must instead ask the first court
to stay its proceedings until the new right-to-sue letter ap-
pears.
We have little to add to the district court’s reasoning. Daza
is undeniably right that he did not explicitly raise a failure-to-
rehire theory in his complaint, but that is just the beginning of
our analysis. In response to INDOT’s motion for summary
judgment, Daza brought up his argument that INDOT dis-
criminated and retaliated against him by failing to rehire him
for the position he had vacated and choosing a less experi-
enced replacement. See Daza v. State, 331 F. Supp. 3d 810, 849–
50 (S.D. Ind. 2018) (“Mr. Daza argues that Defendants retali-
ated against him for filing the EEOC Charge by failing to re-
hire him and instead trying to hire another individual.”) (emphasis
6 No. 20-1209
added). The problem with Daza’s argument, the district court
found, was that he presented no “evidence that he even re-
applied for his position and was rejected and, even if he had,
[there was no] evidence that his EEOC Charge factored into a
decision not to re-hire him.” Id. at 850. Although this was at
the summary-judgment stage, the principles underlying trial
by consent apply here. See Federal Rule of Civil Procedure
15(b)(2). Both parties engaged in this argument, and that,
along with the obvious connection between a complaint about
being fired and a complaint that one was not re-instated to the
same position, is enough to show that it was part of the earlier
litigation.
Daza resists these conclusions with a barrage of argu-
ments, but we find none of them persuasive. Daza complains
that he was not able to obtain all the discovery materials he
needed in Daza I, and that the court did not fully resolve the
failure-to-rehire argument. But the court sensibly found that
no more discovery was warranted. Nothing Daza sought
would have overcome the fact that he “presented [no] evi-
dence that he even re-applied for his position and was re-
jected.” The court accordingly granted summary judgment
and denied Daza’s motion to compel additional discovery as
moot. After that, it entered final judgment on the merits. At
that point, the sufficiency of INDOT’s responses to Daza’s ar-
guments was beside the point: the district court was finished
with the case, thereby allowing this appeal.
Finally, Daza points out that earlier lawsuits cannot pre-
clude litigation over subsequent events. True enough, but that
proposition has no bearing on his case. In Lucky Brand, the Su-
preme Court reiterated the well-understood principle that
claim preclusion does not prevent parties from bringing a suit
No. 20-1209 7
involving actions that “occurred after the conclusion” of the
previous suit. 140 S. Ct. at 1596. Here, however, Daza’s claim
for failure to rehire involved events that existed at the time of
Daza I. Indeed, this is precisely why he was able to raise that
argument in opposition to summary judgment. That he was
awaiting a right-to-sue letter from the EEOC is of no conse-
quence, because “the requirement to exhaust administrative
remedies is no excuse for claim-splitting in this context.” Barr,
796 F.3d at 840.
III
This is Daza’s second stab at raising the claim that INDOT
discriminated and retaliated against him in connection with
his job there, both before and after his firing. He lost in Daza I,
however, and so the district court properly recognized that
claim preclusion bars the present action. We therefore AFFIRM
the judgment.