David Jay Sterling v. United States

FLAUM, Circuit Judge,

concurring in the judgment.

I concur with the majority’s result, but I write separately because I am unable to adopt its analysis.

The issue in this case is whether Sterling’s current FTCA suit is precluded by the judgment in the previous, official-capacity civil rights action that he brought against Officer Miller (Sterling I) concerning the same transaction — the loss of his duffel bag. There can be no dispute that in Sterling I, Sterling sued Miller in both his individual and official capacities. On the first page of the complaint in Sterling I, it is clearly stated that the defendant is sued in both capacities. See R. 15, Government Exhibit 1. Our case law requires a civil rights plaintiff to designate whether a government official is sued in his individual or official capacity, see Hill v. Shelander, 924 F.2d 1370, 1372 (7th Cir.1991); see also Kolar v. County of Sangamon, 756 F.2d 564, 568-69 (7th Cir.1985), and for good reason: an individual-capacity suit seeks “to impose personal liability upon a government official,” Kentucky v. Graham, 473 U.S. 159, 165 , 105 S.Ct. 3099, 3105 , 87 L.Ed.2d 114 (1985), whereas an official capacity action against a government employee is essentially a suit against the government entity itself. Id. at 165-66 , 105 S.Ct. at 3105 ; Monell v. Department of Social Services, 436 U.S. 658 , 690 n. 55, 98 S.Ct. 2018 , 2036 n.55, 56 L.Ed.2d 611 (1978). Whether the suit is an individual or official capacity action determines who (the individual officer or the government) is responsible for satisfying any judgment that the plaintiff might win. See Hill, 924 F.2d at 1372 . Hill thus imposes a duty on the plaintiff to frame his complaint accordingly, and I believe that we must defer to Sterling’s characterization of his own lawsuit as both an individual and an official capacity action.

Because an official-capacity suit against a government official is essentially a suit against the government itself, we have held that for claim preclusion purposes, the government is in privity with officers sued in their official capacities. Gray v. Lacke, 885 F.2d 399, 405 (7th Cir.1989), cert. denied, 494 U.S. 1029 , 110 S.Ct. 1476 , 108 L.Ed.2d 613 *1230 (1990); Beard v. O’Neal, 728 F.2d 894, 897 (7th Cir.), cert. denied, 469 U.S. 825 , 105 S.Ct. 104 , 83 L.Ed.2d 48 (1984); Lee v. City of Peoria, 685 F.2d 196 , 199 n. 4 (7th Cir.1982). 1 Under the rule of Gray, Beard, and Lee , the current suit appears to be precluded by the official-capacity action in Sterling I. This, at least, was the reasoning adopted by the district court.

What complicates this case, however, is that the official-capacity action in Sterling I was doomed from the start. In his suit against Miller, Sterling sought money damages only. Because any award would come from the United States treasury, plaintiffs may not recover monetary damages in official-capacity actions against federal employees unless the United States has waived its sovereign immunity. See, e.g., Robinson v. Overseas Military Sales Corp., 21 F.3d 502, 510 (2d Cir.1994). 2 There was no waiver of sovereign immunity that authorized the official-capacity damages claim in Sterling I. Moreover, when there has been no waiver of sovereign immunity, a court does not have subject-matter jurisdiction to entertain a damages action against the United States. In re Glacier Bay, 71 F.3d 1447, 1450 (9th Cir.1995); Wilkerson v. United States, 67 F.3d 112, 118 (5th Cir.1995). Thus, the official-capacity portion of Sterling I should have been dismissed instantly, and the dismissal for lack of subject-matter jurisdiction would have no preclusive effect (except as to the issue of subject-matter jurisdiction itself). Magnus Electronics, Inc. v. La Republica Argentina, 830 F.2d 1396, 1400 (7th Cir.1987); Lacks v. Fahmi, 623 F.2d 254, 256 (2d Cir.1980) (dismissal on ground of sovereign immunity has no “res judicata or collateral estoppel effect” as to the merits of the ease). 3

Regardless, however, of what should have happened, the district court did not dismiss the official-capacity action in Sterling I for lack of subject matter jurisdiction. Instead, the court assumed jurisdiction and dismissed the entire suit on the merits under Fed. R.Civ.P. 41(b). Because there was a dismissal on the merits, the elements of claim preclusion appear to be satisfied. 4 The question thus becomes whether we should give effect to the dismissal on the merits even though the court erroneously assumed subject-matter jurisdiction over the official-capacity damages claim.

A litigant may not collaterally attack a prior judgment by simply arguing that it is incorrect. Federated Dept. Stores, Inc. v. Moitie, 452 U.S. 394, 398 , 101 S.Ct. 2424, 2428 , 69 L.Ed.2d 103 (1981). In addition, a judgment is generally given preclusive effect even if it was entered in the absence of subject-matter jurisdiction. See Insurance Corp. of Ireland, Ltd. v. Compagnie des *1231 Bauxites de Guinee, 456 U.S. 694 , 702 n. 9, 102 S.Ct. 2099 , 2104 n.9, 72 L.Ed.2d 492 (1982); Chicot County Drainage Dist. v. Baxter State Bank, 308 U.S. 371, 377-78 , 60 S.Ct. 317, 320 , 84 L.Ed. 329 (1940); Disher v. Information Resources, Inc., 873 F.2d 136, 139-40 (7th Cir.1989); Commodities Export Co. v. United States Customs Service, 957 F.2d 223, 228 (6th Cir.), cert. denied, 506 U.S. 831 , 113 S.Ct. 96 , 121 L.Ed.2d 56 (1992); United States v. Chambers, 922 F.2d 228, 239 (5th Cir.1991); Kock v. Government of Virgin Islands, 811 F.2d 240, 243 (3d Cir.1987); cf. Durfee v. Duke, 375 U.S. 106 , 84 S.Ct. 242 , 11 L.Ed.2d 186 (1963). This salutary approach exists because there is a need for finality in the law, and finality would be disserved if courts had to reexamine the jurisdictional basis of every prior judgment before giving it preclusive effect.

There are, however, a few exceptions to the rule that a court’s decision to exercise subject-matter jurisdiction is not open to collateral attack. 5 For instance, if a state court takes jurisdiction over a claim that is exclusively within the province of the federal courts, its judgment is not entitled to preclusive effect. See Kalb v. Feuerstein, 308 U.S. 433, 439 , 60 S.Ct. 343, 346 , 84 L.Ed. 370 (1940) (state court judgment entered in violation of Bankruptcy Act not entitled to preclusive effect); Gonzales v. Parks, 830 F.2d 1033, 1036 (9th Cir.1987). In addition, the Supreme Court has held that a judgment is afforded no res judicata effect if the claim should have been dismissed on the ground of sovereign immunity. United States v. United States Fidelity & Guaranty Co., 309 U.S. 506, 514 , 60 S.Ct. 653, 657 , 84 L.Ed. 894 (1940); see also Blinder, Robinson & Co. v. SEC, 837 F.2d 1099, 1104 (D.C.Cir.), cert. denied, 488 U.S. 869 , 109 S.Ct. 177 , 102 L.Ed.2d 146 (1988). The facts of USF & G are similar to the ease here: a district court assumed jurisdiction over a claim that it should have dismissed because of sovereign immunity. USF & G, 309 U.S. at 512-13 , 60 S.Ct. at 656-57. The USF & G Court held that the prior district court judgment was not entitled to preclusive effect. Id. at 514-15, 60 S.Ct. at 657-58. It may be noteworthy that the prior decision at issue in USF & G was a money judgment against a sovereign, and granting preclusive effect to that judgment would have resulted in an abrogation of sovereign immunity. See id. at 515, 60 S.Ct. at 657-58. 6 In contrast, the decision in Sterling I was in favor of the United States, so there is no fear of preclusion resulting in a money judgment against the treasury. This appears to be a matter of first impression, but I believe that the principle recognized in USF & G should apply both ways: if the government cannot be penalized for a court’s assumption of jurisdiction in a case that should have been dismissed because of sovereign immunity, the government should not be able to benefit from it either. If a court reaches the merits of a claim that is barred by sovereign immunity, the judgment is simply void. 7 Thus, I agree that the judgment *1232 in Sterling I should not preclude Sterling’s current suit.

Finally, I do not believe that the Westfall Act (and the plain language of the text speaks for itself) authorizes Sterling to bring sequential suits. Since I agree, however, that Sterling I does not preclude the instant suit, I concur in the judgment of the court.

. Privity does not exist, however, between the government and an officer sued solely in his individual capacity. Charles Koen & Associates v. City of Cairo, 909 F.2d 992 , 999 n. 7 (7th Cir.1990); Gray, 885 F.2d at 405 . The distinction that we have recognized between the preclusive effects of individual and official capacity suits against government employees appears to conflict with the approach of the Restatement, which establishes a general rule that employers are in privity with their employees. See Restatement (Second) of Judgments § 51 and cmt. a (ALI 1982). Charles Koen and Gray thus implicitly reject § 51, at least with regard to individual capacity suits against government employees.

. Sovereign immunily does not, however, bar a plaintiff from obtaining specific' relief in an official-capacity action when it is alleged that a government official violated the constitution or acted outside of his statutory authority. See Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 689-90 , 69 S.Ct. 1457, 1461-62 , 93 L.Ed. 1628 (1949); Clark v. Library of Congress, 750 F.2d 89, 102 (D.C.Cir.1984).

. A few courts have held that a dismissal on sovereign immunity grounds operates as a dismissal on the merits for res judicata purposes. See Flores v. Edinburg Consolidated Independent School Dist., 741 F.2d 773 , 775 n. 3 (5th Cir.1984) (applying Texas law); Kutzik v. Young, 730 F.2d 149, 151 (4th Cir.1984) (applying Maryland law); Bloomquist v. Brady, 894 F.Supp. 108, 116 (W.D.N.Y.1995). This understanding conflicts with our statement in Magnus that "[a] judgment dismissing a suit for lack of jurisdiction does not preclude a party from litigating the same cause of action in a court of competent jurisdiction." Magnus, 830 F.2d at 1400 (emphasis in original).

. For claim preclusion to apply, three elements must be present:

(1) there must be a final judgment on the merits;

(2) the two suits must arise out of the same transaction or occurrence; and (3) both actions must involve the same parties or their privies. Doe v. Allied-Signal, Inc., 985 F.2d 908, 913 (7th Cir.1993).

.The Restatement identifies three such exceptions:

When a court has rendered a judgment in a contested action, the judgment precludes the parties from litigating the question of the court's subject matter jurisdiction in subsequent litigation except if:

(1) The subject matter of the action was so plainly beyond the court’s jurisdiction that its entertaining the action was a manifest abuse of authority; or

(2) Allowing the judgment to stand would substantially infringe the authority of another tribunal or agency of government; or

(3) The judgment was rendered by a court lacking capability to make an adequately informed determination of a question concerning its own jurisdiction.

Restatement (Second) Judgments § 12 (ALI 1982).

. Such a judgment may be void under § 12(2) of the Restatement because it "infringe[s] the authority” of a sovereign.

. If the question of sovereign immunity was actually litigated in the original suit, the parties may be precluded from relitigating the issue in a subsequent proceeding. See Durfee v. Duke, 375 U.S. 106, 111 , 84 S.Ct. 242, 245 , 11 L.Ed.2d 186 (1963) ("a judgment is entitled to full faith and credit — even as to questions of jurisdiction — when the second court's inquiry discloses that those questions have been fully and fairly litigated and finally decided in the court which rendered the original judgment”); In re Penn Central Transportation Co., 384 F.Supp. 895, 954 (Sp.Ct.R.R.R.A. 1974) ("We doubt that the [USF & G] case eliminates the application of collateral estoppel when the suability of the sovereign is at issue.... It is not certain that the result [in USF & G] would have been the same if a challenge to *1232 the jurisdiction of the [original] Missouri court had been made and erroneously overruled and the decision had not been appealed.”). In Sterling I, however, as in USF & G, the question of sovereign immunity was never litigated. In addition, the court's failure to dismiss Sterling's official-capacity damages claim on sovereign immunity grounds was plainly erroneous. USF & G implies that in such situations, the judgment on the merits is void.