United States Court of Appeals 

For the Seventh Circuit 

Chicago, Illinois 60604 

Submitted September 2, 2015*

Decided September 9, 2015 

Before 

DIANE P. WOOD, Circuit Judge 

RICHARD A. POSNER, Circuit Judge 

ILANA DIAMOND ROVNER, Circuit Judge

No. 14-3492 

THOMAS L. BURSE, 

Plaintiff-Appellant, 

v. 

MARK GOTTLIEB, et al., 

 Defendants-Appellees.

 Appeal from the United States District 

Court for the Eastern District of Wisconsin.

No. 13-C-804 

William E. Callahan, Jr., 

Magistrate Judge. 

No. 15-1649 

THOMAS L. BURSE, 

Defendant-Appellant, 

v. 

STATE OF WISCONSIN, 

 Plaintiff-Appellee.

 Appeal from the United States District 

Court for the Eastern District of Wisconsin.

No. 13-C-1200 

Lynn Adelman, 

Judge. 

 

*

 After examining the briefs and record, we have concluded that oral argument is 

unnecessary. Thus the appeal is submitted on the briefs and record. See FED. R. APP. P.

34(a)(2)(C). 

NONPRECEDENTIAL DISPOSITION

To be cited only in accordance with Fed. R. App. P. 32.1 
No. 14-3492 & 15-1649 Page 2 

O R D E R 

We have consolidated these two appeals for disposition. Both cases arose after the 

Wisconsin Department of Transportation discovered that Thomas Burse, a state 

contractor, falsified his education qualifications on his resume and overbilled the 

Department by $ 1.3 million. The Department suspended (and eventually barred) him 

from the state’s Disadvantaged Business Enterprise (DBE) program, terminated his state 

contracts, and withheld payments to Burse in order to mitigate its losses. This forced 

Burse and his business into bankruptcy, where the state of Wisconsin filed an adversary 

proceeding under 11 U.S.C. § 523(a)(2)(A). That statute prevents discharge of debts 

obtained through fraud, and the state invoked it to prevent Burse from discharging 

through bankruptcy the $882,000 he still owed to the state. The bankruptcy court ruled 

that the debt was non-dischargeable, the district court affirmed, and in the first of these 

two consolidated appeals (No. 15-1649) we affirm as well. In a separate suit, the second 

of our two appeals (No. 14-3492), Burse alleges that he was deprived of his due process 

rights when he was suspended from the DBE program without a pre-suspension 

hearing. The district court granted summary judgment for the defendants, and because 

Burse received all the process that he was due, we affirm that judgment as well. 

The DBE program aims to boost state contracts awarded to businesses with socially 

and economically disadvantaged owners who meet state qualifications. Burse and his 

construction-management company, Buveck, began to participate in Wisconsin’s DBE 

program in 2003, but in 2010 the state found two problems with his participation. The 

first was that Burse had lied about his educational background. In one resume Burse 

asserted that he had earned an engineering degree from Illinois State University, but in 

another he claimed to have an engineering degree from Bradley University. After the 

state asked Burse to verify his Bradley degree, he twice provided forged transcripts, and 

Bradley University later reported that Burse was not a graduate. The second problem 

was with overbilling. An audit in 2010 revealed that Burse was billing for the same work 

twice, inflating the number of hours employees worked, and exaggerating their rate of 

hourly pay. In the auditor’s opinion, the sheer number of “mistakes” in the records 

combined with evidence of forged employee signatures on timesheets and unauthorized 

changes to timesheets established that Burse had committed fraud. 

After uncovering these two problems, the state sent Burse notice on October 14, 2011, 

that it was suspending him as a contractor. The notice informed him of the reasons that 

the state had found fraud and overbilling and that Burse owed the state $882,528.24 

because of his overbilling. The state also notified him that it would not approve him for 

new transportation contracts during the suspension, it was posting his name on the 
No. 14-3492 & 15-1649 Page 3 

published list of suspended contractors, and it was reviewing his current contracts to 

determine whether they would be terminated. The state gave him a prompt opportunity 

for a hearing—fifteen days later—to contest the suspension, but Burse requested and 

received longer—to November 25—to respond. During the next month the state 

provided Burse’s attorney examples of the fraud uncovered in the audit and offered 

Burse a chance to submit rebuttal evidence. Burse never responded with any exculpatory 

evidence. His attorney merely asserted that the state had not specified the grounds for 

suspension and supplied only limited proof of the audit’s findings or Burse’s 

involvement in the problems identified in the audit. On December 1, the state barred 

Burse and his company from future transportation contracts and terminated the 

contracts on his current projects. 

Burse filed for bankruptcy, and in an adversary proceeding the state claimed that 

Burse’s debt to the state was obtained through fraud and could not be discharged. The 

bankruptcy court held a trial at which the auditor testified that the widespread 

overstatements in Burse’s company records could not be attributed to mere negligence. 

The bankruptcy judge did not believe Burse’s response that he did not know that the 

invoices and timesheets overstated billings. The judge observed that Burse signed many 

of the falsified timesheets, Burse oversaw his company’s billing practices, and his 

company had a pattern of creating false time sheets and bills. The bankruptcy court 

therefore found fraud and ruled that the debt was not dischargeable. Burse appealed to 

the district court, which affirmed the bankruptcy court’s ruling. 

In the first appeal, Burse challenges the bankruptcy court’s ruling. Our review 

focuses on the bankruptcy court’s rulings, rather than those of the district court, and we 

review its factual findings for clear error and legal conclusions de novo. See In re 

marchFIRST, Inc., 573 F.3d 414, 416 (7th Cir. 2009). To prove that a debt is 

non-dischargeable because of fraud, a creditor must prove by a preponderance of 

evidence that “(1) the debtor made a false representation or omission, (2) that the debtor 

(a) knew was false or made with reckless disregard for the truth and (b) was made with 

the intent to deceive, (3) upon which the creditor justifiably relied.” Ojeda v. Goldberg, 599 

F.3d 712, 716–17 (7th Cir. 2010). 

Burse points to nothing that calls the bankruptcy court’s ruling into question. As to 

the first element, Burse does not challenge that the invoices and timesheets contained 

false representations. On the second element, Burse contends only that no “direct” 

evidence made him responsible for the “mistakes” that lead to the overbilling. But the 

bankruptcy judge was entitled to rely on circumstantial evidence, which showed that, by 

signing inflated timesheets and overseeing a billing system that regularly overcharged 
No. 14-3492 & 15-1649 Page 4 

the state, Burse knew about the falsehoods and intended to deceive the state. See Matter 

of Sheridan, 57 F.3d 627, 633 (7th Cir. 1995). For the final element, Burse seems to argue 

that the state was not justified in relying on his falsified resume for his DBE certification 

because DBE regulations do not require a college degree. But the non-dischargeable debt 

stems from the intentional overbilling, not the DBE certification. True, the bankruptcy 

judge said that, “arguably, under that premise [that the resume fraud led to an 

undeserved DBE certification], every dollar that Buvek collected when it acted as a DBE 

sub should be non-dischargeable.” But the bankruptcy judge recognized that the state 

was not asking for repayment of “every” dollar, but rather only the debts from the 

overbilling. Accordingly, the fraud and non-dischargeability rulings were proper, so we 

affirm the first judgment. 

The second appeal arises from Burses’s separate suit alleging that his seven-week 

suspension violated his procedural rights. In it he raises two claims that he continues to 

pursue on appeal. First, he contends that the state violated due process by suspending 

him and withholding contract payments before it gave him a chance to refute the 

charges. The district court rejected this claim. It accepted that Burse was deprived of 

property interests in the form of both a continued contractual relationship and contract 

payments. But in light of the state’s significant interest in preventing fraud, the minimal 

risk of an erroneous suspension based on the audit, and the prompt opportunity to 

oppose the suspension, Burse received due process. The court also rejected Burse’s 

second claim, which is that by publicizing his suspension the state defamed him in 

violation of due process. The judge explained that Burse identified no “lost 

opportunities” because of the posting. 

On appeal Burse maintains that the state violated due process by denying him a 

hearing before it suspended him. To prevail on this due process claim, Burse must show 

that the state deprived him of a protected interest and that the procedures it used did not 

comply with minimum due process requirements. See Hinkle v. White, No. 14-2254, 2015 

WL 4297887, at *2 (7th Cir. July 16, 2015). The defendants concede that Burse had a 

protected interest before it suspended him, so all that we must decide is what process 

Burse was due. A pre-deprivation hearing is not always required; the need for one 

depends on the balance “between the benefits and costs of such process.” Siebert v. 

Severino, 256 F.3d 648, 659 (7th Cir. 2001) (quoting Penn Cent. Corp. v. U.S. R.R. Vest Corp., 

955 F.2d 1158, 1163 (7th Cir. 1992)). The three relevant considerations are: (1) the private 

interest that will be affected, (2) the risk of an erroneous deprivation, and (3) the 

government interest. See Mathews v. Eldridge, 424 U.S. 319, 335 (1976). 
No. 14-3492 & 15-1649 Page 5 

Balancing these three considerations, we conclude that Burse had no right to 

pre-suspension process. Burse has a strong interest in receiving payments for past work 

and continuing his contractual relationship with the state. But the seven-week 

suspension limited only Burse’s ability to enter into new state contracts. The state 

terminated his existing contracts only after his debarment, which occurred after he was 

offered a full hearing, the adequacy of which Burse does not challenge. The second and 

third considerations outweigh Burse’s private interest. The government has a substantial 

interest in protecting taxpayers from fraudulent billing. And the risk of an erroneous 

suspension was low because the audit, its findings, and the pre-suspension investigation 

established reasonable grounds to believe Burse had defrauded the state. Those findings 

obviated the need for a pre-suspension hearing. See Barry v. Barchi, 443 U.S. 55, 64–65 

(1979) (a pre-deprivation hearing was unnecessary for suspending horse-racing license 

because the suspension was based on probable cause). Furthermore Burse received 

immediate notice of the suspension and a prompt opportunity to contest the suspension. 

These added procedures supplied whatever process he was due. 

Burse also repeats his claim that, by publishing his name on the list of suspended 

contractors, the state harmed his reputation and thereby violated due process. A 

defamation claim ground in due process requires some showing that the defamatory 

statements “alter[ed] or extinguish[ed] a right or status recognized by state law.“ Santana 

v. Cook County Bd. of Review, 679 F.3d 614, 621 (7th Cir. 2012) (quoting Brown v. Michigan 

City Ind., 462 F.3d 720, 730 (7th Cir. 2006)). As the district court correctly pointed out, 

Burse identified no situation in which a prime contractor ended or refused to enter into a 

contract because of the posting. Any contracts that Burse lost directly with the state 

resulted from his suspension, not the posting. The district court thus properly granted 

summary judgment for the defendants in the second case. 

AFFIRMED.