### In the 

# United States Court of Appeals For the Seventh Circuit

____________________ No. 17-2803

D OUG T AYLOR, Plaintiff-Appellant ,

v.

C ITY OF L AWRENCEBURG , D EARBORN C OUNTY , S TATE OF I NDIANA , an Indiana municipal corporation, et al., Defendants-Appellees

.

____________________ Appeal from the United States District Court for the Southern District of Indiana, New Albany Division. No. 4:14-cv-00077-RLY-TAB — Richard L. Young , Judge

.

____________________

A RGUED J ANUARY 18, 2018

— D ECIDED N OVEMBER 20, 2018

____________________

Before S YKES and H AMILTON , Circuit Judges , and L EE , District Judge. 

L EE , District Judge . The appellant, Doug Taylor, claims that the Board of Public Works and Safety of the City of Lawrenceburg (“the Board”) terminated his employment with the City

 The Honorable John Z. Lee, District Judge for the United States District Court for the Northern District of Illinois, sitting by designation.2 No. 17-2803

because of his disagreements wi th the Mayor and exposure of purported wrongdoing by City o ffi cials. Seeking redress, Taylor fi led suit against the City, members of the Board, and several City o ffi cials, bringing a claim of First Amendment retaliation pursuant to 42 U.S.C. § 1983. Taylor also asserted statelaw claims of defamation, violation of free-speech rights under the Indiana constitution, an d violation of Indiana’s whistleblower statute. The district court entered summary judgment in the City’s favor as to Taylor’s claims. We a ffi rm. I. B ACKGROUND Doug Taylor is a former police o ffi cer of the City of Lawrenceburg, Indiana. He also held positions with the City’scivil-city, parks, and electric departments. Taylor ran for a position on Lawrenceburg’s City Council and, in April 2011, improperly appeared in police uniform at an event for his campaign. Taylor also inaccurately represented on his police time sheet that he was on duty during the campaign event. The Indiana State Police investigated th is conduct, resulting in the fi ling in October 2011 of criminal charges against Taylor for O ffi cial Misconduct and Ghost Employment. Taylor won election to the City Council in November 2011. The Board placed Taylor on administrative leave with pay shortly after the criminal charges were fi led. It later moved him to a front-desk position wi thin the police department in January 2012. On March 13, 2013, Taylor signed a deferred prosecution agreement admi tt ing to the criminal charges and agreeing to resign from the City Council. The next day, he distributed to local, state, and federal law en forcement agencies an eleven-No. 17-2803 3

page le tt er accusing the Board and various City o ffi cials, including Mayor Dennis Carr, of corruption and criminal wrongdoing. A week later, the Board noti fi ed Taylor of its intent to terminate his employment as a police o ffi cer (as well as with “any other department of the City”) and informed him of his right to a hearing pursuant to Indiana Code § 36-8-3-4(c). Taylor requested a hearing.Prior to the hearing, the Board adopted a rule that its decision would be determined by a simple majority vote of the Board members who were present during the presentation of evidence and argument. Five me mbers, including the Mayor, were present to hear the evidence and arguments at Taylor’s hearing. After considering the evidence, the Board voted 2 to 1 to terminate Taylor’s employment. The Mayor, who votes only in the event of a tie, di d not vote, and one other member of the Board abstained. Taylor’s employment was terminated, and he stopped receiving paychecks from the City. The Board subsequently issued its fi ndings of fact and law pursuant to § 36-8-3-4(i). In its fi ndings, the Board credited alocal prosecutor’s testimony that he would not accept caserelated information from a police o ffi cer, like Taylor, who had admi tt ed to a crime of dishonesty. The Board also rejected Taylor’s contention that th e Board members were biased against him. In addition, the Board rebu ff ed Taylor’s suggestion that the termination proceedings were initiated in response to his March 14, 2013, le tt er accusing Board members and others of wrongdoing. The Board found “no causal connection” be-4 No. 17-2803

tween the termination proceedings and the le tt er and explained that it had waited for th e resolution of Taylor’s criminal charges before issuing the notice of termination. Pursuant to § 36-8-3-4(e), Taylor had the right to appeal the Board’s decision to “the circuit or superior court of the county in which [the Board was] located,” within thirty days, § 36-8- 3-4(f), after which the Board’s decision would become “ fi nal and conclusive,” § 36-8-3-4(g). Taylor timely appealed the Board’s decision to the Dearborn County Superior Court on October 25, 2013, but he voluntarily dismissed the appeal in August 2014, before it was adjudicated.

II. A NALYSIS The district court entered su mmary judgment in favor ofthe defendants, concluding that Taylor’s First Amendment retaliation claim was barred by res judicata or collateral estoppel and that the individual defendants were immune to Taylor’sstate law claims pursuant to § 36-13-3-5(b) because he had alleged that they had acted “under authority or color of state law.” The district court also fo und that the state law claims failed on the merits. We review a grant of summary judgment de novo

. Brunson v. Murray , 843 F.3d 698, 704 (7th Cir. 2016).

In University of Tennessee v. Ellio tt , 478 U.S. 788, 798–99 (1986), the Supreme Court held that federal courts must give state administrative fact fi nding “the same preclusive e ff ect to which it would be entitled in th e State’s courts,” provided that the state agency acted in a judi cial capacity and resolved issues that the parties had an adequate opportunity to litigate. We have no trouble concluding that the Board acted in a judicial capacity here. In Goodwin v. Board of Trustees of the University of Illinois , 442 F.3d 611, 620 (7th Cir. 2006), we held thatNo. 17-2803 5

a state board that made employ ment decisions had acted in a judicial capacity because (1) its decision was subject to judicial review pursuant to state law, (2) a hearing o ffi cer had presided over the hearing, which provided the opportunity for counsel to examine and cross- examine witnesses under oath, and (3) the board issued fi ndings of fact. The same is true here. For his part, Taylor points to evidence that, he contends, shows certain Board members engaged in improper ex parte communications with some witnesses, City employees, and fellow Board members. But Taylor had the opportunity to raise these issues when he a ppealed the Board’s determination to the Indiana Superior Court and chose not to do so. Given Taylor’s ability to fully litigate these issues before the Board, the Board’s fi ndings of fact and law, and the availability of judicial review, we are satis fi ed that the Board acted in a judicial capacity. Turning to the application of issue preclusion under Indiana law, as we explained in Mains v. Citibank, N.A. , 852 F.3d 669, 675–76 (7th Cir. 2017), cert. denied , 138 S. Ct. 227 (2017), the Supreme Court of Indiana ha s stated that “[i]n general, issue preclusion bars subsequent litigation of the same fact or issue that was necessarily adjudicated in a former suit.” Miller Brewing Co. v. Ind. Dep’t of State Revenue , 903 N.E.2d 64, 68(Ind. 2009). Moreover, “Indiana courts follow federal precedents in applying issue prec lusion (also commonly referred to as collateral estoppel).” Mains , 852 F.3d at 675–76 (citing Miller, 903 N.E.2d at 68). Thus, “[i]n order for issue preclusion to apply under Indiana law, the ... decision must be fi nal.” Id. at 676. From there, we ask two questions: “(1) whether theparty in the prior action had a full and fair opportunity to litigate the issue and (2) whether it is otherwise unfair to apply6 No. 17-2803

collateral estoppel given the facts of the particular case.” Indianapolis Downs, LLC v. Herr, 834 N.E.2d 699, 705 (Ind. Ct. App. 2005). Taylor fi rst argues that issue preclusion should not apply because the Board’s decision wa s a nullity and, therefore, not fi nal. Prior to Taylor’s hearing , the Board had adopted a decisional rule requiring a majority vote of the Board members who were present to hear evidence and argument. Five Board members participated in the he aring, but only three actually voted, with two out of the three voting for termination. Andso, Taylor contends, the Board “never made a decision to terminate his employment.”Of course, Taylor cannot mean to argue that the Board issued no decision at all. It made a determination and issued fi ndings of fact and law. As a result, Taylor’s employment was terminated, and he stopped receiving checks from the City. Instead, what Taylor is doing is challenging the validity of that decision. But the appropriate forum for Taylor to press this issue was the Circuit or Superior Court in Dearborn County. § 36- 8-3-4(e). Knowing this, Taylor fi led an appeal, but withdrew it before it could be adjudicated. Under Indiana law, once an appeal is withdrawn, it is as though it was never fi led. See State ex rel. Weaver v. Paxson , 11 N.E.2d 677, 678 (Ind. 1937) (holding that police o ffi cer who withdrew appeal of a Board of Public Works decision had “m anifestly” failed to appeal). And, because “the decision of the board is fi nal and conclusive upon all persons not appealing,” § 36-8-3-4(g), the Board’s decision became fi nal as to Taylor once he withdrew his appeal.No. 17-2803 7

The next question is whether Taylor had a full and fair opportunity to litigate before the Board the same issues that underlie his claims in this suit. The crux of Taylor’s federal and state free-speech retaliation claims, as well as his state law whistleblower claim, is his co ntention that the Board terminated him because of his March 2013 disagreements with Mayor Carr. Taylor litigated these issues before the Board, and the Board found against him. In its fi ndings, the Board stated thatthere was no causal connection between its decision and Taylor’s le tt er, but rather that the proceedings were “causally related to the resolution or disposition of judicial proceedings ... . Speci fi cally, ... [Taylor] was subject to criminal charges prior to the execution of the de ferred prosecution agreement, such that disciplinary proceed ings could not commence until after the execution of the agreement. The Board fi nds that until [Taylor] admi tt ed the elements of his criminal activity in the context of a judicial proc eeding, any prior admission by [him] was entitled to less weight.” Moreover, as to Taylor’s clashes with Mayor Carr, the Board also rejected his argument that the Board members were improperly biased or prejudiced against him. Taylor therefore had the opportunity to litigate before the Board the same material issues underlying his claims in thiscase. And, for the same reasons discussed above, we are convinced that Taylor had a full and fair opportunity to be heard on these issues. Lastly, as to his defamation claim, Taylor argues again thatthis claim should be revived because the Board’s determination was not approved by the required majority vote. His defamation claim arises out of the Board’s proposed fi ndings,8 No. 17-2803

which he contends improperly credited the testimony of a prosecutor about Taylor’s inabil ity to testify credibly in his role as a police o ffi cer after having admi tt ed to a crime of dishonesty. But, again, Taylor failed to appeal the Board’s determination and, therefore, is bound by its fi ndings as to these issues under Indiana law. To the extent Taylor’s defamation claim rests on issues that coul d not have been litigated untilafter the Board issued its decision, Taylor could argue that issue preclusion should not apply; but he does not make that argument and thus waives it. See Hojnacki v. Klein-Acosta , 285 F.3d 544, 549 (7th Cir. 2002). In any event, it is di ffi cult to see how the Board’s fi ndings regarding the testimony by the state prosecutor that he would not rely on Taylor in the future could possibly constitute defamation.

The district court’s decision is a ffi rmed.