In the

    United States Court of Appeals
                 For the Seventh Circuit
                    ____________________
No. 13-3257
FREDERICK V. GREENE,
                                                Plaintiff-Appellant,

                                 v.

UNITED STATES DEPARTMENT OF EDUCATION,
                                     Defendant-Appellee.
                    ____________________

        Appeal from the United States District Court for the
    Northern District of Indiana, Hammond Division at Lafayette.
        No. 4:10-cv-00019 — Joseph S. Van Bokkelen, Judge.
                    ____________________

   ARGUED OCTOBER 8, 2014 — DECIDED OCTOBER 27, 2014
                    ____________________

   Before POSNER, FLAUM, and SYKES, Circuit Judges.
    POSNER, Circuit Judge. This appeal requires us to decide
what is needed to make a counterclaim compulsory. The
plaintiff, Frederick Greene, appeals from a judgment direct-
ing him to repay his student loan debt to the federal De-
partment of Education. The judgment is based on a counter-
claim filed by the Department to Greene’s complaint, which
sought to enjoin the Department from collecting his student
debt by garnishment of his wages or any other measure. The
2                                                 No. 13-3257


judge ruled that the Department’s counterclaim seeking a
judgment ordering Greene to repay the debt was not barred,
either as a compulsory counterclaim in a previous litigation
or by res judicata or collateral estoppel.
    In 2005 Greene and his wife had filed for bankruptcy un-
der Chapter 7 of the Bankruptcy Code and obtained a dis-
charge from all their debts except federal student loan debt
of some $207,000. As part of the bankruptcy case they sought
an order that the Department of Education cancel their debt
on the ground that having to repay it would inflict undue
hardship on them. This was denied and the Greenes ap-
pealed, claiming that their debt should be discharged among
other reasons “because of undue hardship. See U.S.C. §
523(a)(8). Specifically, the Greenes claimed that (1) the stat-
ute of limitations prohibited collection of their loans, (2)
penalties and interest on the loans were caused by the DOE’s
negligence, and (3) the loans should be discharged as repara-
tions for slavery and discrimination.” In re Greene, 310 F.
App’x 17, 19 (7th Cir. 2009). We rejected the undue hardship
defense on the ground that “the Greenes initiated this case
and the DOE has not counterclaimed or sought any judg-
ment with respect to the student debt. Until the DOE at-
tempts to collect the debt, there is no actual controversy pre-
sented for decision.” 

the Department began to garnish Greene’s wages
(we don’t know whether the Department has attempted to
collect the student debt of Greene’s wife), giving rise to his
present suit and to the Department’s counterclaim, on which
judgment was entered in its favor.
   “A proceeding [in bankruptcy court] to determine the
dischargeability of a debt” is an adversary proceeding.
No. 13-3257                                                  3


Bankr. R. 7001(6). Bankruptcy Rule 7013 makes Rule 13 of
the Federal Rules of Civil Procedure applicable to such pro-
ceedings. Rule 13(a)(1) provides that “a pleading must state
as a counterclaim any claim that—at the time of its service—
the pleader has against an opposing party if the claim: (A)
arises out of the transaction or occurrence that is the subject
matter of the opposing party’s claim.” The “transaction or
occurrence” in question was the Greenes’ failure to repay the
student loans, and it was also the basis of the counterclaim
by the Department of Education in the present case. But to
interpret Rule 13(a)(1)(A) literally and say that therefore the
Department should have sought repayment by filing a coun-
terclaim in the adversary proceeding and having failed to do
so is barred from seeking repayment as a counterclaimant in
this suit would have bad consequences. Greene initiated his
adversary proceeding in 2005, and the government might
have had realistic hopes of obtaining repayment of the loans
without further litigation, whether by garnishment or be-
cause with the discharge of their other debts the Greenes
might be able to pay back their student loans without un-
dergoing undue hardship. In light of these possibilities the
Department’s seeking affirmative relief in the adversary pro-
ceeding—an order that the Greenes repay the loans—might
well have been premature. It isn’t true that any counterclaim
that ultimately arises out of the same transaction or occur-
rence as the other side’s claim must be filed or lost. That
could allow an infinite regress.
   The reasons for making some counterclaims compulsory
are to prevent harassment by the filing of repeated claims by
defendants and to avoid duplicative litigation. In re Price, 

, 1073 (7th Cir. 1994); Burlington Northern Railroad
Co. v. Strong, 

, 710 (7th Cir. 1990); Transamerica
4                                                   No. 13-3257


Occidental Life Ins. Co. v. Aviation Office of America, Inc., 

, 389–90 (3d Cir. 2002); Adam v. Jacobs, 

, 93
(2d Cir. 1991). Understanding that to be the purpose of the
concept of the compulsory counterclaim, and noting its close
relation to the doctrine of res judicata, which like the com-
pulsory-counterclaim rule seeks to avoid duplicative litiga-
tion, Matrix IV, Inc. v. American National Bank & Trust Co. of
Chicago, 

, 547 (7th Cir. 2011); Allan Block Corp. v.
County Materials Corp., 

, 915–17 (7th Cir. 2008),
provides clearer guidance to decision than vague words like
“transaction” and “occurrence.”
    Had the government filed a counterclaim in the adver-
sary proceeding, seeking repayment of the Greenes’ student
loans—as it could have done—and had lost, it could not
have refiled its claim as a counterclaim in the present suit.
Adams v. City of Indianapolis, 

, 735–36 (7th Cir.
2014). That would have been harassment. But the govern-
ment had sound reasons for holding off from seeking af-
firmative relief in the adversary proceeding. Better to block
discharge of Greene’s student loan debt, and thus reserve
the right to sue later to collect the money owed it, than to try
to draw water from a stone. So far as appears, the Greenes
had (as suggested by their being allowed to discharge most
of their debts) little in the way of assets on which the gov-
ernment could have levied in 2005. The government could
and did pursue other remedies, such as garnishment, which
are simpler and cheaper than suing; freed of their other
debts the Greenes might have been able to begin, at least, to
repay their student debt.
   Moreover, what Greene owed on his student loan (in the
absence of a successful defense of undue hardship) was a
No. 13-3257                                                     5


different issue from whether making him pay what he owed
would impose an undue hardship. The criteria of undue
hardship are complex. See, e.g., Krieger v. Educational Credit
Management Corp., 

, 883 (7th Cir. 2013); United
States v. Petroff-Kline, 

, 289–90 (6th Cir. 2009). The
size of the debt is relevant—the larger it is, the more likely
that imposing full liability on the debtor will produce an
undue hardship—but calculating the debt involves a differ-
ent factual inquiry from whether the debt so calculated is
crushing. The government’s claim for repayment and
Greene’s quest for cancellation of the debt by reason of un-
due hardship had a common origin, namely the student
loans (which dated back to 1987), but it was a remote com-
mon origin.
    We therefore agree with the district court that the De-
partment’s counterclaim is not barred. As for Greene’s alter-
native grounds for barring the Department’s claim for re-
payment of his student loans—res judicata and collateral es-
toppel—they fall with his compulsory-counterclaim argu-
ment. The “compulsion” of a compulsory counterclaim is a
procedural implementation of the doctrine of res judicata.
Allan Block Corp. v. County Materials Corp., 

, 916–
17 (7th Cir. 2008). It forbids the splitting of a claim, and that
didn’t happen. Nor was any judicial determination made in
the adversary proceeding that would bar the Department’s
claim. See, e.g., Taylor v. Sturgell, 

, 892–93 (2008);
Stoebner v. Parry, Murray, Ward & Moxley, 

, 1094
(8th Cir. 1996).
                                                      AFFIRMED.