SHELLHOUSE v. MATTIS et al

Filing 15

ORDER - Plaintiff Earnest Earl Shellhouse's complaint against the Secretary of Defense ("the Secretary") claims that he was improperly denied a promotion because the interviewers "lowballed" his interview scores in order to promote "their favorite" candidates, who Mr. Shellhouse alleges were unqualified. The Secretary is entitled to judgment as a matter of law under Federal Rule of Civil Procedure 12(b)(6), and the Court therefore GRANTS the Secretary's Motion to Dismiss. 13 Final judgment will issue accordingly. (See Order.) Copy to Plaintiff via U.S. Mail. Signed by Judge Jane Magnus-Stinson on 10/24/2018. (DMW)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
TERRE HAUTE DIVISION
EARNEST EARL SHELLHOUSE,
Plaintiff,
v.
MATTIS, Secretary of the Army,
Defendant.

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No. 2:18-cv-00135-JMS-MJD

ORDER
Plaintiff Earnest Earl Shellhouse’s complaint against the Secretary of Defense (“the
Secretary”) claims that he was improperly denied a promotion because the interviewers
“lowballed” his interview scores in order to promote “their favorite” candidates, who Mr.
Shellhouse alleges were unqualified.1 [Shellhouse II, Filing No. 1.] The Secretary now moves to
dismiss Mr. Shellhouse’s complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), arguing,
among other things, that the doctrine of res judicata bars this lawsuit because Mr. Shellhouse
previously litigated these claims in another lawsuit. [Shellhouse II, Filing No. 14.] For the
following reasons, the Court GRANTS the Secretary’s Motion to Dismiss.
I.
LEGAL STANDARD
Under Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss a claim that
does not state a right to relief. The Federal Rules of Civil Procedure require that a complaint
provide the defendant with “fair notice of what the . . . claim is and the grounds upon which it
rests.” Erickson v. Pardus, 551 U.S. 89, 93 (2007) (quoting Bell Atlantic v. Twombly, 550 U.S.

Throughout this opinion, the Court refers and cites to Mr. Shellhouse’s first case, No. 2:13-cv00086-JMS-WGH, as “Shellhouse I.” The Court refers to this case as “Shellhouse II.”
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544, 555 (2007)). In reviewing the sufficiency of a complaint, the Court must accept all well-pled
facts as true and draw all permissible inferences in favor of the plaintiff. See Active Disposal Inc.
v. City of Darien, 635 F.3d 883, 886 (7th Cir. 2011). A Rule 12(b)(6) motion to dismiss asks
whether the complaint “contain[s] sufficient factual matter, accepted as true, to ‘state a claim to
relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly,
550 U.S. at 570). The Court may not accept legal conclusions or conclusory allegations as
sufficient to state a claim for relief. See McCauley v. City of Chicago, 671 F.3d 611, 617 (7th Cir.
2011). Factual allegations must plausibly state an entitlement to relief “to a degree that rises above
the speculative level.” Munson v. Gaetz, 673 F.3d 630, 633 (7th Cir. 2012). This plausibility
determination is “a context-specific task that requires the reviewing court to draw on its judicial
experience and common sense.” Id.
II.
BACKGROUND
The following facts are drawn from Mr. Shellhouse’s pleadings in this case and in his
earlier-filed case, which are accepted as true for the purpose of deciding the Secretary’s Motion to
Dismiss.
A. Shellhouse I Complaint
Prior to filing the present case, Mr. Shellhouse, a civilian employee of Crane Army
Ammunition Activity, filed a complaint in 2013 against Secretary of the Army John McHugh,
alleging that he was improperly denied a promotion as a result of gender discrimination.
[Shellhouse I, Filing No. 6.] Mr. Shellhouse’s 2013 amended complaint alleged that his March
28, 2012 interview for a “WG-8 promotion” involved interviewers who had a conflict of interest
and unfairly scored Mr. Shellhouse’s interview, ultimately denying Mr. Shellhouse the promotion
in favor of two unqualified applicants. [Shellhouse I, Filing No. 6 at 2.] On January 30, 2014, the

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Court granted defendant’s motion for summary judgment because Mr. Shellhouse failed to exhaust
his administrative remedies when he did not contact an EEO counselor within 45 days of the
alleged discriminatory conduct, as required by 29 C.F.R. § 1614.105. [Shellhouse I, Filing No. 29
at 11.]
B. Shellhouse II Complaint in this Lawsuit
On March 16, 2018, Mr. Shellhouse filed a Complaint alleging “promotion fraud” against
Secretary of Defense James N. Mattis (alleged in his complaint as “Secretary of the Army”).
[Shellhouse II, Filing No. 1.] Mr. Shellhouse’s Complaint is again based upon his March 28, 2012
interview for a WG-8 promotion. [Shellhouse II, Filing No. 1 at 2.] Mr. Shellhouse alleges that
his interviewers purposely gave him low scores so that the interviewers’ “favorite,” less qualified
employees would instead receive the promotion. [Shellhouse II, Filing No. 1 at 3.]
On June 28, 2018, the Secretary filed his Motion to Dismiss. [Shellhouse II, Filing No.
14.] In light of Mr. Shellhouse’s failure to respond, the Secretary’s Motion is ripe for the Court’s
decision.
III.
DISCUSSION
The Secretary argues that Mr. Shellhouse’s lawsuit must be dismissed because he filed a
nearly-identical lawsuit five years prior to filing this lawsuit, which ended in summary judgment
in favor of then-Secretary of the Army John McHugh.

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[Shellhouse II, Filing No. 14.] Mr.

Shellhouse did not respond to the Secretary’s motion to dismiss before the deadline on July 12,
2018 and to-date has not filed a response to the Secretary’s Motion.

Because the Court concludes that res judicata bars the relitigation of Mr. Shellhouse’s claims,
the Court does not address the Secretary’s other arguments in support of dismissal.
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The doctrine of res judicata precludes the same parties from re-litigating claims already
decided on the merits in a prior action. Simon v. Allstate Employee Group Med. Plan, 263 F.3d
656, 658 (7th Cir. 2001). Res judicata extends to those claims that could have been raised in the
prior action, but were not. Ross ex. rel. Ross v. Bd. of Educ. of Twp. High Sch. Dist. 211, 486 F.3d
279, 283 (7th Cir. 2007). To prevail, the party asserting res judicata must establish (1) identity of
the claims, (2) identity of the parties or their privies, and (3) a final judgment on the merits. Id.
“The fact that the suits [may] differ in some respects . . . is not enough to defeat a finding” that a
subsequent suit is barred by res judicata. Id.
First, the party invoking res judicata must establish that the new case seeks to litigate
identical claims from the previous case. Two claims are treated as identical for the purposes of res
judicata if they arose out of the same transaction; that is, if they are based on the same, or nearly
the same, factual allegations. Id. (citing Herrmann v. Cencom Cable Associates, Inc., 999 F.2d
223, 226 (7th Cir. 1993)). This determination requires a factual inquiry, meaning that two claims
based on different legal theories are still treated as one if they are based on the same factual
allegations. Herrmann, 999 F.2d at 226.
The two complaints are based upon the same allegations that Mr. Shellhouse was
improperly denied a promotion by the Department of Defense after a faulty interview process that
occurred on March 28, 2012. In both complaints, Mr. Shellhouse alleged that he received unfairly
low scores because the interviewers were biased in favor of other, less qualified candidates. The
Secretary has demonstrated that the claims in this case share an identity with the claims brought
in Shellhouse I.
Second, the Secretary must establish identity of parties or their privies. Establishing
identity of parties, or parties in privity, requires an inquiry into whether the parties have a

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“sufficiently close identity of interests.” Tice v. American Airlines, Inc., 162 F. 3d 966, 971 (7th
Cir. 1998).

Under this inquiry, lawsuits against employees in their official capacities are

tantamount to lawsuits against the government entity for which they work, so privity exists
between government entities and their employees for the purposes of res judicata. See Gray v.
Lacke, 885 F.2d 399, 405 (7th Cir. 1989).
Both complaints in Shellhouse I and Shellhouse II were filed by Mr. Shellhouse. In
Shellhouse I, Mr. Shellhouse named John M. McHugh, in his official capacity as Secretary of the
Army, as the defendant. [Shellhouse I, Filing No. 6 at 1.] In this complaint in Shellhouse II, Mr.
Shellhouse names James N. Mattis, in his official capacity as Secretary of Defense, as the
defendant. [Shellhouse II, Filing No. 1 at 1.] In both suits, Mr. Shellhouse brings claims against
officials of the Department of Defense. The Secretary has established that privity exists between
the Department of Defense and its officials, such that there is an identity of parties for purposes of
res judicata.
Finally, the Secretary must establish that the first matter ended in a final judgment. A final
judgment on the merits is a judgment “based on legal rights as distinguished from mere matters of
practice, procedure, jurisdiction, or form.” Harper Plastics, Inc. v. Amoco Chemicals Corp., 657
F.2d 939, 943 (7th Cir. 1981) (quoting Fairmont Aluminum Co. v. Comm’r, 222 F.2d 622, 625
(4th Cir. 1955)). In Shellhouse I, this Court issued a decision granting summary judgment in favor
of the defendant based on Mr. Shellhouse’s failure to exhaust his administrative remedies.
[Shellhouse I, Filing No. 29 at 11.] Ordinarily, the failure to exhaust administrative remedies
results in dismissal without prejudice. See, e.g., Teal v. Potter, 559 F.3d 687, 693 (7th Cir. 2009).
This is not the case, however, when “it is too late . . . to obtain administrative consideration” at the
time of the dismissal. McGuinness v. U.S. Postal Serv., 744 F.2d 1318, 1321 (7th Cir. 1984); see

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Teal, 559 F.3d at 693 (citing McGuinness). In such circumstances, the exhaustion deadline “is
construed as a statute of limitations.” Smith v. Potter, 445 F.3d 1000, 1006 n.14 (7th Cir. 2006)
(quoting Johnson v. Runyon, 47 F.3d 911, 917 (7th Cir. 1995)), overruled in part on other grounds
by Hill v. Tangherlini, 724 F.3d 965, 967 n.1 (7th Cir. 2013)). As the Seventh Circuit has
explained, “A decision by a federal court that a statute of limitations or an administrative deadline
bars an action is a decision on the merits for purposes of claim preclusion.” Kratville v. Runyon,
90 F.3d 195, 198 (7th Cir. 1996).
In Shellhouse I, the Court granted the Secretary of Defense’s motion for summary
judgment because Mr. Shellhouse failed to exhaust his administrative remedies within the 45-day
period provided by the regulations. [Shellhouse I, Filing No. 29 at 10 (“Shellhouse, in his
Response, admits that he failed to comply with the 45-day requirement imposed upon federal
employees to contact an EEO counselor.”)]; see 29 C.F.R. § 1614.105(a). The Court ruled, in
other words, that Mr. Shellhouse had not exhausted his administrative remedies and in fact could
no longer do so because the deadline had expired. Under those circumstances, the Court’s decision
granting summary judgment is a final judgment on the merits for the purposes of res judicata.
Because the Secretary has established that Mr. Shellhouse previously litigated identical
claims against an identical party in a case that ended in a final judgment, the Secretary has
established that Mr. Shellhouse’s complaint in this case is barred by the doctrine of res judicata.
The Secretary is entitled to judgment as a matter of law under Federal Rule of Civil Procedure
12(b)(6), and the Court therefore GRANTS the Secretary’s Motion to Dismiss. [Shellhouse II,
Filing No. 14.]

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IV.
CONCLUSION
For the foregoing reasons, the Court GRANTS the Secretary’s Motion to Dismiss. [13]
Final judgment will issue accordingly.

Date: 10/24/2018

Distribution:
EARNEST EARL SHELLHOUSE
5930 N. Golfcourse Rd.
Bicknell, IN 47512
Jackson Taylor Kirklin
UNITED STATES ATTORNEY'S OFFICE (Indianapolis)
[e-mail]

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