MARY M. ROWLAND, District Judge.
Defendant Elite Staffing, Inc. ("Elite") moves to dismiss on res judicata grounds, arguing that Plaintiffs are engaged in impermissible claim splitting following the settlement of an earlier case. For the following reasons, Elite's motion to dismiss on res judicata grounds (Dkt. 174) is granted.
As this case has been proceeding for several years, the Court presumes general familiarity with the factual background and includes only a brief summary of facts relevant to this motion. On November 18, 2016, Francisco Hernandez filed a class action complaint asserting various claims under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1962(c) and 1964(c) ("RICO"), the Fair Labor Standards Act, 29 U.S.C. § 201, et. seq. ("FLSA"), the Illinois Minimum Wage Law, 820 ILCS 105/1, et. seq. ("IMWL"), the Illinois Wage Payment Collection Act, 820 ILCS 115/1, et. seq. ("IWPCA"), and the Illinois Day and Temporary Labor Services Act, 820 ILCS 175/1, et. seq. ("IDTLSA"). Plaintiffs eventually filed a Third Amended Complaint, which several Defendants moved to dismiss under Rule 12(b)(6). On September 6, 2018, the Court dismissed only the RICO claims, finding that the remaining claims were "marginally sufficient" and thus stated a claim. (Dkt. 217 at 4-5) The Court instructed Plaintiffs to file an amended complaint, but only to make each count more straightforward and to make it clear which counts applied to which defendants. (Id.) Importantly, this instruction was "based on form rather than substance," as the Court already determined that the Third Amended Complaint stated a claim. (Id.) Plaintiff complied with the Court's instruction and filed a Fourth Amended Complaint on September 20, 2018. (Dkt. 218)
Elite moves to dismiss on res judicata grounds, arguing that Plaintiff is engaged in impermissible claim splitting following the settlement of a prior lawsuit, Baker v. Elite Staffing, Inc., Case No. 15 CV 3246. (Dkt. 230 at 1) In Baker, Plaintiffs on behalf of themselves and all others similarly situated sued Elite for violations of the FLSA, the IMWL, and the IDTLSA. (Id.) The Court certified a Rule 23 class encompassing all of Plaintiffs' "state law claims." (Case No. 15 CV 3246, Dkt. 43 ¶ 3) The claims raised in the Baker case arise from the same transactions encompassed in the instant case, and there is significant overlap in the time periods covered.
The parties settled the Baker action pursuant to a settlement agreement. (Dkt. 230 at 2-4) On March 1, 2017, the Baker Court entered a final order of approval and dismissed the matter with prejudice. (Id. at Ex. C; Case No. 15 CV 3246, Dkt. 55) Elite argues that the final order in Baker acts as a bar to the instant action.
"The preclusive effect of a federal court judgement is determined by federal common law." Taylor v. Sturgell, 553 U.S. 880, 891 (2008). The doctrine of res judicata bars claims that were "litigated or could have been litigated in a previous action." Bell v. Taylor, 827 F.3d 699, 706 (7th Cir. 2016). Res judicata, or claim preclusion, has three elements: "(1) an identity of the parties or their privies in the first and second lawsuits; (2) an identity of the cause of action; (3) a final judgment on the merits in the first suit." Adams v. City of Indianapolis, 742 F.3d 720, 736 (7th Cir. 2014).
The elements of res judicata are met. As mentioned above, the claims raised in Baker arise from the same transactions as in the instant case, and the time periods covered are the same. (Dkt 230 at 2-4) Each Plaintiff in the instant case was an unnamed class member in Baker and did not opt out of that class or the settlement agreement. (Id.) Thus, the elements of res judicata are met. However, Plaintiffs argue that in settling Baker, those Plaintiffs released only those claims arising under the IDTLSA and preserved all others. (Dkt. 234 at 21-22) In making this argument,
Plaintiffs point to the language of the settlement agreement and the scope of the release. Specifically, the settlement provided:
(Dkt. 234 at 21) (citing Ex. G, Joint Stipulation and Agreement to Settle Class Action Claims).
However, Elite is not arguing that Plaintiff released their claims. (Dkt. 247 at 3) Rather, Elite argues that the dismissal of the Baker case acts as a bar to the instant suit, "irrespective of the scope of the release." (Id.) The Court agrees. Although the Baker plaintiffs may have intended to release only the IDTLSA claims and preserve all others, that is not what happened. Instead, the Baker court certified a class of state law claims and then dismissed all of the pending claims with prejudice. (Case. No. 15 C 3246, Dkt. 55, Final Approval Order) As Elite notes, the scope of the release does not alter the ultimate resolution of the case. (Dkt. 247 at 3) The Baker court dismissed the entire action—all claims pending against Elite—with prejudice. (Dkt. 230, Ex. C ¶ 15; Case. No. 15 C 3246, Dkt. 55, Final Approval Order) This is a final order on the merits and prevents Plaintiffs from raising claims in the instant action. Kilburn-Winnie v. Town of Fortville, 891 F.3d 33, 333 (7th Cir. 2014). The present claim is barred. Consequently, the Court grants Elite's motion to dismiss.
For the foregoing reasons, Elite's motion to dismiss (Dkt. 174) is granted.
In the Marquez suit, Plaintiff Marquez alleges that she worked for Elite from mid-2014 through April 2015, Plaintiff Martinez alleges that she worked for Elite from mid-2014 through March 2016, and Plaintiff Flores alleges that she worked for Elite in 2014. (Case No. 16 C 10748, Dkt. 171 ¶ 24, 30, 37) In Hernandez, Plaintiff Hernandez alleges that he worked for Elite from early 2015 through at least mid-2016. It appears that the timeframe of the instant suit significantly overlaps with that of Baker, and that Plaintiffs could have brought the instant claims in the earlier suit.