In the 

United States Court of Appeals 

For the Seventh Circuit ____________________ 

No. 19-1942 

H.A.L. NY HOLDINGS, LLC, 

Plaintiff-Appellant, 

v.

JOSEPH MICHAEL GUINAN, JR., 

Defendant-Appellee. 

____________________ 

Appeal from the United States District Court for the 

Northern District of Illinois, Eastern Division. 

No. 1:18-cv-07615 — Robert W. Gettleman, Judge. 

____________________ 

ARGUED JANUARY 23, 2020 — DECIDED MAY 5, 2020 

____________________ 

Before ROVNER, HAMILTON, and SCUDDER, Circuit Judges. 

HAMILTON, Circuit Judge. Plaintiff H.A.L. NY Holdings, 

LLC is in the business of trading securities. It set up a brokerage account with Advantage Futures, LLC in Chicago. 

H.A.L.’s trading losses led Advantage to issue margin calls, 

which H.A.L. failed to meet. Advantage then liquidated 

H.A.L.’s account, leaving a negative balance of more than 

$75,000. When H.A.L. failed to pay, Advantage sued in fed-
2 No. 19-1942 

eral court in Chicago. H.A.L. responded with an offer of judgment under Federal Rule of Civil Procedure 68 for the entire 

amount in dispute, plus attorney fees and costs. Advantage 

accepted and judgment was entered. 

One might expect that to have been the end of the story. 

But H.A.L. did not actually pay the judgment it had offered. 

Instead, H.A.L. filed this new lawsuit against the CEO of Advantage claiming damages of more than $25 million arising 

from the same transactions. The Advantage CEO invoked the 

defense of res judicata based on the prior judgment. The district court agreed and dismissed this case. H.A.L. has appealed. 

We affirm. Several features of this appeal also convince us 

that this is one of those unusual cases where we should 

impose sanctions under Federal Rule of Appellate Procedure 

38. H.A.L. admits that its solitary argument to the district 

court was wrong and offers in its place an entirely new 

argument on appeal. Both are meritless. And after telling the 

district court that state law is irrelevant, H.A.L. now insists 

that if we do not reverse, only certification to the state 

supreme court can resolve this case. This appeal is an exercise 

in unacceptable gamesmanship, without a reasonable and 

good-faith basis. Hence the Rule 38 sanctions. 

I. Factual and Procedural Background

We state the facts as alleged in the complaint in this case 

and, to the extent not inconsistent with them, as alleged in the 

complaint and as revealed by the docket in the prior case, both 

proper subjects of judicial notice on a motion to dismiss. Watkins v. United States, 854 F.3d 947, 950 (7th Cir. 2017) (prior 

complaint); Fletcher v. Menard Corr. Ctr., 623 F.3d 1171, 1173 
No. 19-1942 3

(7th Cir. 2010) (prior case docket). Plaintiff H.A.L. NY Holdings, LLC is a New York company whose business is trading 

stock index futures and options. In September 2015, H.A.L. 

set up a brokerage account to trade through Advantage Futures, LLC, an Illinois company and registered futures commission merchant. Defendant Joseph Michael Guinan, Jr., is 

Advantage’s chairman and chief executive. 

H.A.L. suffered trading losses and failed to respond 

promptly to margin calls by Advantage. Advantage then liquidated H.A.L.’s trading positions, which left H.A.L. with a 

negative account balance of $75,375.26. In September 2017 

Advantage sued H.A.L. in the Northern District of Illinois for 

that amount. The district court had jurisdiction of the case under 28 U.S.C. § 1332. On November 14, 2017 H.A.L. made an 

offer of judgment under Federal Rule of Civil Procedure 68 

for the full amount of the claim plus prejudgment interest, attorney fees, and costs. Advantage accepted the offer one week 

later, and the district court entered the judgment in Advantage’s favor. The parties agreed at oral argument before 

this court that the judgment had not been paid as of January 

23, 2020. 

A few months after entry of judgment in Illinois, on March 

14, 2018, H.A.L. filed this lawsuit, not against Advantage but 

against CEO Guinan, in the Southern District of New York, 

alleging that he breached common law and federal statutory 

duties, causing the demise of H.A.L’s account with Advantage to the tune of $25,500,000 in damages. The district 

court had jurisdiction of the case under 28 U.S.C. §§ 1331 and 

1367. On Guinan’s motion, the case was transferred to the 

Northern District of Illinois under 28 U.S.C. § 1404(a). 
4 No. 19-1942 

Guinan moved to dismiss for failure to state a claim under 

Federal Rule of Civil Procedure 12(b)(6), arguing that the 

prior Rule 68 judgment between Advantage and H.A.L. was 

res judicata barring the new suit by H.A.L. against Guinan. 

The district court agreed, granted Guinan’s motion, and entered final judgment in his favor. H.A.L. has appealed. 

II. Analysis 

On the merits, the question is whether the prior Rule 68 

judgment should be given res judicata effect to bar H.A.L.’s 

claims in this lawsuit. H.A.L.’s opening brief is dedicated 

chiefly to arguing that Illinois law on this point either favors 

it or is so uncertain that, if we do not reverse, we should at 

least certify a question of state law to the Illinois Supreme 

Court under Circuit Rule 52. Guinan opposes certification and 

seeks sanctions under Federal Rule of Appellate Procedure 38 

for taking a frivolous appeal. 

A. Standard of Review

We review de novo the district court’s dismissal of the action for failure to state a claim. Benson v. Fannie May Confections Brands, Inc., 944 F.3d 639, 644 (7th Cir. 2019). The attentive reader will have noted that the district court did not actually rule H.A.L.’s complaint failed to state a claim; it 

reached the quite different conclusion that the lawsuit is 

barred by the affirmative defense of res judicata. “Federal law 

distinguishes between the two, and so too should the careful 

litigator.” Amy St. Eve & Michael A. Zuckerman, The Forgotten 

Pleading, 7 Fed. Cts. L. Rev. 152, 160 (2013). Strictly speaking, 

the correct vehicle for determining an affirmative defense on 

the pleadings is an answer and a motion for judgment on the 

pleadings under Rule 12(c). Benson, 944 F.3d at 645, and the 
No. 19-1942 5

cases cited. Observing the distinction is necessary to allocate 

correctly the burdens of pleading and proof, and can thus be 

critical to the proper application of the Rule 12 standards. 

In this particular case, however, the factual foundation for 

the res judicata defense can be found in the records of the first 

district court case, the contents of which are subject to judicial 

notice. The choice between Rule 12(b)(6) and Rule 12(c) has 

no practical effect here, and our review is plenary either way. 

See Doe v. GTE Corp., 347 F.3d 655, 657 (7th Cir. 2003). 

B. The Rule 68 Judgment 

On the merits, the general rule is that the res judicata effect 

of a federal judgment is a matter of federal common law. Semtek Int’l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 507–08 

(2001). As in this case, though, when the prior federal judgment was rendered as an exercise of a federal court’s diversity 

jurisdiction over state-law claims, federal common law refers 

to the res judicata (claim preclusion) law of the state in which 

the rendering court sits, unless applying that law would be 

“incompatible with federal interests.” Id. at 508–09. This rule 

is not dictated by the Rules of Decision Act, 28 U.S.C. § 1652, 

so that Erie Railroad Co. v. Tompkins, 304 U.S. 64 (1938), does 

not apply by its terms. Semtek shares Erie’s concerns, however, 

see 531 U.S. at 504, 508–09, so we turn to Erie for guidance in 

determining state law. 

We apply state law “as it either has been determined by 

the highest court of the state or as it would be by that court if 

the present case were before it now.” Allstate Ins. Co. v. 

Menards, Inc., 285 F.3d 630, 637 (7th Cir. 2002). Contrary to 

H.A.L.’s arguments, we do not try to apply what we perceive 

to be a regional law within a state, such as might arise if a state 
6 No. 19-1942 

has intermediate courts with geographic divisions that have 

disagreed on the relevant content of state law. See id. at 634, 

636. 

The prior Rule 68 judgment was rendered in the Northern 

District of Illinois, so Semtek directs us to Illinois claim preclusion law. In Illinois, the defense of res judicata or claim preclusion requires proof of three elements: “(1) there was a final 

judgment on the merits rendered by a court of competent jurisdiction; (2) there was an identity of cause of action; and (3) 

there was an identity of parties or their privies.” Rein v. David 

A. Noyes & Co., 665 N.E.2d 1199, 1204 (Ill. 1996). The defense 

precludes not only relitigation of “what was actually decided 

in the original action,” but also litigation of any “matters 

which could have been decided in that suit.” Id. In this case, 

the second and third elements are admitted. H.A.L. challenges the first element, arguing that Illinois would not regard 

a Rule 68 judgment as “a final judgment on the merits” eligible for claim-preclusive effect. 

Illinois is one of the few American jurisdictions without a 

general offer-of-judgment rule analogous to Federal Rule of 

Civil Procedure 68. See 735 Ill. Comp. Stat. 5/2-101 to 2-2301 

(code of civil procedure); Laura T. Kidwell, State Offer of Judgment Rule—Construction, Operation, and Effect of Acceptance and 

Resulting Judgment, 120 A.L.R. 5th 559 (2004 & supp. 2012). 

That does not matter. Illinois courts are familiar with consent 

judgments more generally. See, e.g., U.S. Bank N.A. v. Johnson, 

55 N.E.3d 742, 746 (Ill. App. 2016). That’s what a Rule 68 judgment is. See, e.g., Downey v. State Farm Fire & Cas. Co., 266 F.3d 

675, 682–83 (7th Cir. 2001). The special feature of Rule 68—its 

wager of costs after an unaccepted offer in subsection 68(d)—

is not material to the res judicata effect of an accepted offer. 
No. 19-1942 7

And we have held repeatedly that Illinois gives consent judgments claim-preclusive effect if preclusion otherwise applies. 

For example, in 4901 Corp. v. Town of Cicero, 220 F.3d 522, 529–

30 (7th Cir. 2000), we affirmed dismissal of a new challenge to 

a town’s ordinance because the parties had settled an earlier 

dispute with the equivalent of a consent decree: an Illinois 

state-court judgment that incorporated the terms of the parties’ agreement. As the district court correctly concluded, that 

is the end of H.A.L.’s case. 

C. H.A.L.’s Counterarguments 

H.A.L.’s contrary arguments on appeal were “foreordained to lose.” Jaworski v. Master Hand Contractors, Inc., 882 

F.3d 686, 691 (7th Cir. 2018). First, H.A.L. never breathed a 

whisper of Illinois law in the district court. Instead, H.A.L.’s 

brief on the preclusion issue ignored Semtek and insisted that 

state law was irrelevant. On appeal, though, H.A.L. has 

shifted to an entirely new theory, based entirely on Illinois 

law. That entirely new theory was of course waived, and 

H.A.L. and its lawyer should have known that before pursuing this theory on appeal. Now on appeal, H.A.L. concedes 

that its arguments in the district court were “wrong.” It does 

not argue that Illinois law actually supports it. It argues instead that we should either apply what it says is the law of the 

Illinois Appellate Court’s First District or certify the question 

of state law to the Illinois Supreme Court. Clearer cases of 

waiver “in the truest sense” are hard to find. G & S Holdings 

LLC v. Cont’l Cas. Co., 697 F.3d 534, 538 (7th Cir. 2012). 

Second, putting aside the fatal waiver, even on its own 

terms H.A.L.’s position in the district court was wrong on the 

merits of federal law, without reference to state law. H.A.L. 

argued that federal law would not allow giving res judicata 
8 No. 19-1942 

effect to Rule 68 judgments. Federal law holds just the opposite. E.g., Arizona v. California, 530 U.S. 392, 414 (2000) (“consent judgments ordinarily support claim preclusion”); United 

States v. International Bldg. Co., 345 U.S. 502, 506 (1953) (“Certainly the [consent] judgments entered are res judicata of the 

tax claims”); La Preferida, Inc. v. Cerveceria Modelo, S.A. de C.V., 

914 F.2d 900, 906 (7th Cir. 1990) (“consent judgments ordinarily support claim preclusion”); Martino v. McDonald’s Sys., 

Inc., 598 F.2d 1079, 1083 (7th Cir. 1979) (“The conclusion of the 

earlier ... lawsuit with a consent judgment does not prevent 

the earlier judgment from having a res judicata effect.”); Beloit 

Culligan Soft Water Serv., Inc. v. Culligan, Inc., 274 F.2d 29, 35 

(7th Cir. 1959) (“A consent judgment operates as a res judicata.”); see also United States v. Fisher, 864 F.2d 434, 439 (7th 

Cir. 1988) (“A consent decree is res judicata”). 

H.A.L. argued that the prior Rule 68 judgment was not a 

“final judgment on the merits” because it contained no admission of liability. This was and is a non-starter. See International 

Bldg. Co., 345 U.S. at 506 (“Certainly the [consent] judgments 

entered are res judicata of the tax claims ... , whether or not 

the basis of the agreements on which they rest reached the 

merits.”). “The rule that a defendant’s judgment acts as a bar 

to a second action on the same claim is based largely on the 

ground that fairness to the defendant, and sound judicial administration, require that at some point litigation over the particular controversy come to an end.” Restatement (Second) of 

Judgments § 19 cmt. a (Am. Law Inst. 1982). What difference 

could it make for this purpose that the plaintiff previously insisted it did nothing wrong while agreeing in the same breath 

to pay money on pain of contempt against defendant’s claim 

of wrongdoing? See Fletcher v. City of Fort Wayne, 162 F.3d 975, 
No. 19-1942 9

977 (7th Cir. 1998). Patent law recognizes a narrow and carefully limited exception, holding that admissions of liability 

are required to give certain consent judgments preclusive effect. See American Equip. Corp. v. Wikomi Mfg. Co., 630 F.3d 544, 

546 (7th Cir. 1980) (for reasons specific to patent law: “Res judicata effect will not be accorded to consent decrees containing only a concession of the validity of the patent without an 

... acknowledgment of its infringement.”). As best we can tell, 

that exception is limited to consent judgments regarding patent validity, and H.A.L. did not even try to rely on it in the 

district court. 

Third, waiver notwithstanding, H.A.L.’s position on appeal is foreclosed as a matter of controlling circuit law applying Illinois claim-preclusion law. H.A.L.’s opening brief cited 

neither 4901 Corporation nor our other precedents on the preclusive effect accorded by Illinois to “equivalent” compromise 

judgments. See 4901 Corp., 220 F.3d at 529–30; see also ArlinGolf, LLC v. Village of Arlington Heights, 631 F.3d 818 (7th Cir. 

2011) (voluntary dismissal with prejudice pursuant to settlement agreement was res judicata under Illinois law); Majeske 

v. Fraternal Order of Police, Local Lodge No. 7, 94 F.3d 307, 312–

14 (7th Cir. 1996) (judgment incorporating settlement agreement, “rather than being the result of full litigation on the 

merits,” was res judicata under Illinois law); Torres v. Rebarchak, 814 F.2d 1219, 1223 (7th Cir. 1987) (under Illinois law, 

“res judicata applies even if the dismissal was the result of a 

settlement or compromise between the parties”) (cited once 

without discussion by H.A.L.). The precedential force of these 

decisions is not impaired by a handful of Illinois Appellate 

Court opinions arguably stating the law differently. Reiser v. 

Residential Funding Corp., 380 F.3d 1027, 1029 (7th Cir. 2004). 
10 No. 19-1942 

Our task is to apply the law of Illinois, not the law of a particular geographic district of the intermediate appellate court. 

Allstate Ins. Co., 285 F.3d at 636. H.A.L. offers no reason to believe that the Illinois Supreme Court would disavow the 

weight of Illinois authority, which we have read uniformly to 

allow claim preclusion by consent judgment, only to adopt 

the law of an embattled minority of sister jurisdictions. See 

Sheldon R. Shapiro, Modern Views of State Courts as to Whether 

Consent Judgment Is Entitled to Res Judicata or Collateral Estoppel 

Effect, 91 A.L.R. 3d 1170, § 3[a] (1979 & supp. 2019) (Illinois, 

forty-one other states, and District of Columbia allow claim 

preclusion by consent judgment). H.A.L.’s opening brief cites 

two precedential opinions from the Illinois Appellate Court’s 

First District, which H.A.L. reads as going its way. Defendant 

Guinan cites twelve precedential opinions going the other 

way, from all four districts of the Appellate Court issued over 

a thirty-five year period.

Empirically the “split” is thus largely illusory. It is wholly 

so when we trace the First District foundations for H.A.L.’s 

new appellate argument in Kandalepas v. Economou, 645 

N.E.2d 543 (Ill. App. 1994), and Caporale v. Shannon Plumbing 

Co., 314 N.E.2d 540 (Ill. App. 1974). Kandelepas is commonly 

quoted to the effect that “an agreed order is not a judicial determination of the parties’ rights” but “a recordation of the 

agreement between the parties.” 645 N.E.2d at 548.1 A federal 

court is most certainly not “a recorder of contracts” but “an 

1 Kandalepas took this language from a case applying the uncontroversial and here irrelevant rule that “an agreed order generally is not subject 

to appellate review.” In re Haber, 425 N.E.2d 1007, 1009 (Ill. App. 1981). 

See, e.g., Downey v. State Farm Fire & Cas. Co., 266 F.3d 675, 682–83 (7th Cir. 

2001). 
No. 19-1942 11

organ of government” charged with the exercise of federal 

power. Local No. 93, Int’l Ass’n of Firefighters v. City of Cleveland, 

478 U.S. 501, 525 (1986). Refusing preclusion on this theory 

thus might well be “incompatible with federal interests.” See 

Semtek, 531 U.S. at 509. In any event the quoted statement is 

obiter dictum. The holding of Kandalepas was that that a first 

agreed order (entered in 1987) was not res judicata as to a 

third order (entered in 1991) where a second agreed order (entered in 1988) had been vacated because decided by coin-flip 

and the first had been abandoned by the parties and the court 

in favor of the second after a motion to vacate the first was 

filed but never ruled on. 645 N.E.2d at 545, 548. Given that 

unusual situation, whatever Kandalepas stands for, it is not 

that consent judgments cannot be res judicata. 

Caporale also does not help H.A.L. The case held that a defendant had waived its argument that a prior stipulated dismissal was res judicata by participating in subsequent litigation through a contested judgment. 314 N.E.2d at 542. In the 

alternative, a stipulated dismissal “as a matter of administrative convenience” (the two suits had been consolidated before 

the first was dismissed, id. at 541) estopped the defendant 

from raising the defense. Id. at 542. That Caporale does not 

hold that consent judgments cannot be res judicata is clear 

from the opinion of the concurring judge, who thought they 

could not be. See id. (Hallett, J., concurring). We see nothing 

in Kandalepas, Caporale, or the cases citing them that would 

persuade the Illinois Supreme Court to reject the weight of 

contrary authority from its own decisions, many other Illinois 

appellate decisions, and courts in other jurisdictions. 
12 No. 19-1942 

III. Motion to Certify 

As for H.A.L.’s motion to certify an issue of law to the Illinois Supreme Court under Circuit Rule 52, the “most important consideration” in deciding whether to certify is 

“whether the reviewing court finds itself genuinely uncertain 

about a question of state law that is vital to a correct disposition of the case.” State Farm Mut. Auto. Ins. Co. v. Pate, 275 F.3d 

666, 671 (7th Cir. 2001). For the reasons just explained, we are 

not genuinely uncertain about Illinois law on this point. The 

motion to certify is denied. 

IV. Motion for Sanctions 

There remains only defendant Guinan’s motion for sanctions under Federal Rule of Appellate Procedure 38, which 

permits an award of “just damages and single or double costs 

to the appellee” in a frivolous appeal. “We have found appeals frivolous where the appellants simply failed to put together a coherent argument that came to grips with the applicable law, the relevant facts, and the district courts’ reasoning.” Harris N.A. v. Hershey, 711 F.3d 794, 802 (7th Cir. 2013), 

citing, e.g., Williams v. U.S. Postal Service, 873 F.2d 1069, 1075 

(7th Cir. 1989) (imposing Rule 38 sanctions where appellant 

failed to cite relevant cases or address district court’s reasoning); Rosenburg v. Lincoln American Life Ins. Co., 883 F.2d 1328, 

1339–40 (7th Cir. 1989) (imposing Rule 38 sanctions on life insurance company that refused to pay death benefit and then 

appealed adverse jury verdict without coming to grips with 

applicable law and relevant evidence); see also Greviskes v. 

Universities Research Ass’n, Inc., 417 F.3d 752, 760 (7th Cir. 

2005) (ordering appellant to show cause why Rule 38 sanctions should not be imposed where arguments on appeal 

were “almost incomprehensible and entirely nonsensical,” 
No. 19-1942 13

and there was “simply no legal foundation” for claims). This 

is the meaning of our admonitions against “rehash[ing] positions the district court properly rejected.” Jaworski v. Master 

Hand Contractors, Inc., 882 F.3d 686, 691 (7th Cir. 2018). What 

is sanctionable is not merely repeating a losing argument. 

That is necessary to avoid waiver. What is sanctionable is doing so while “fail[ing] to present any arguable reason why the 

district court erred” in rejecting the argument the first time. 

Bugg v. Int’l Union of Allied Indus. Workers of Am., Local 507, 674 

F.2d 595, 600 (7th Cir. 1982). 

H.A.L.’s appeal fits this bill. Its sole argument to the 

district court—that federal law applied and Rule 68 

judgments could not support res judicata—was doomed. 

First, it was built on the admittedly flawed premise that state 

law was irrelevant. Second, it was doomed on its own terms 

by unanimous federal precedent. On appeal H.A.L. has 

conceded that its sole argument to the district court was 

“wrong,” which effectively concedes that its appeal cannot 

succeed. Most of its opening brief argued that Illinois law on 

claim preclusion was unsettled. The brief did not address our 

precedents applying that law, nor did it attempt to apply our 

well-settled predictive approach to determining its content as 

a matter of first principles. Finally, H.A.L.’s only substantive 

argument against claim preclusion is contained in three pages 

of its opening brief that repeated its position (no admission of 

liability equals no preclusion) without even addressing the 

controlling authority that the district court cited and 

followed. Failing to engage with a district court’s central 

reasons and authority is usually a reliable sign of a doomed 

appeal. E.g., Hackett v. City of South Bend, — F.3d —, — (7th 

Cir. 2020); Webster v. CDI Indiana, LLC, 917 F.3d 574, 578 (7th 

Cir. 2019); Klein v. O’Brien, 884 F.3d 754, 757 (7th Cir. 2018) 
14 No. 19-1942 

(“ an appellate brief that does not even try to engage the 

reasons the appellant lost has no prospect of success”); 

Gonzalez-Servin v. Ford Motor Co., 662 F.3d 931, 934 (7th Cir. 

2011) (“ostrich-like tactic of pretending that potentially 

dispositive authority against a litigant’s contention does not 

exist is as unprofessional as it is pointless,” quoting Mannheim 

Video, Inc. v. County of Cook, 884 F.2d 1043, 1047 (7th Cir. 1989), 

quoting in turn Hill v. Norfolk & Western Ry., 814 F.2d 1192, 

1198 (7th Cir. 1987) (imposing sanctions under Rule 38)). And 

saving an attack on the district court’s reasons for an 

appellant’s reply brief does not salvage an otherwise frivolous 

appeal; the reply brief is an opportunity to reply, not to say 

what should have been said in the opening brief. Parrillo v. 

Commercial Union Ins. Co., 85 F.3d 1245, 1250 (7th Cir. 1996). 

This appeal was objectively frivolous from beginning to end. 

“When an appeal is frivolous, Rule 38 sanctions are not 

mandatory but are left to the sound discretion of the court of 

appeals to decide whether sanctions are appropriate.” Harris, 

711 F.3d at 802. “Typically the courts have looked for some 

indication of the appellant’s bad faith suggesting that the appeal was prosecuted with no reasonable expectation of altering the district court’s judgment and for purposes of delay or 

harassment or out of sheer obstinacy.” Reid v. United States, 

715 F.2d 1148, 1155 (7th Cir. 1983), citing Ruderer v. Fines, 614 

F.2d 1128, 1132 (7th Cir. 1980), and Roadway Express, Inc. v. 

Piper, 447 U.S. 752, 766 (1980) (discussing scope of bad faith). 

This appeal fits that description, for several reasons. 

After having made a Rule 68 offer of judgment that was 

accepted, H.A.L.’s unsuccessful attempt to litigate its case on 

its home turf, its continuing failure to pay the judgment it 

offered to Advantage, its appellate abandonment of its 
No. 19-1942 15

district-court theory, and the last-ditch quality of its motion 

to certify together smack of gamesmanship and delay well 

worth deterring. See Harris, 711 F.3d at 801 (“Rule 38 has both 

a compensatory and a deterrent purpose.”); Smith v. Blue 

Cross & Blue Shield United of Wis., 959 F.2d 655, 661 (7th Cir. 

1992) (sanctions appropriate where appeal taken for purpose 

of delay). It appears highly doubtful H.A.L. ever intended to 

pay the judgment it offered. Instead, it launched this new 

case, originally in a new venue, seeking a fresh start with 

massive damage claims against which Advantage’s prior 

judgment would offer only a tiny discount. At the very least, 

we are convinced that H.A.L. has pursued this appeal as part 

of an effort to keep this doomed case on life-support as long 

as possible as a bargaining chip with Advantage. 

We close by emphasizing again that this court’s doors are 

always open to “disagreements brought to us in good faith,” 

Harris, 711 F.3d at 801, including good-faith arguments for 

modifying or reversing existing law. See Fed. R. Civ. P. 

11(b)(2); Reiser v. Residential Funding Corp., 380 F.3d 1027, 

1029–30 (7th Cir. 2004) (“This is not to say that decisions of 

intermediate state courts never could induce us to look afresh 

at issues of state law; a decision demonstrating that our initial 

resolution rested on some obvious error would do the trick.”); 

Sparks v. N.L.R.B., 835 F.2d 705, 707 (7th Cir. 1987) (Fed. R. Civ. 

P. 11 informs Fed. R. App. P. 38). Where, an appellant has ignored controlling precedent and occasionally misrepresented 

it (for example, H.A.L. claimed “The Seventh Circuit and the 

Northern District of Illinois have applied both of Illinois’ approaches to res judicata” when we have done no such thing), 

we may impose sanctions for deterrent and compensatory 

purposes without fear of chilling good-faith arguments in the 

future. 
16 No. 19-1942 

The judgment of the district court is AFFIRMED. Plaintiff

H.A.L.’s motion to certify a question of law to the Illinois Supreme Court is DENIED. Defendant Guinan’s motion for 

sanctions is GRANTED. Guinan may submit an affidavit and 

supporting documentation within 21 days after the issuance 

of this opinion specifying his damages incurred in defending 

this appeal. H.A.L. may file a response within 21 days after 

Guinan’s submission is docketed.