author: BOGGS, Circuit Judge. NATHANIEL R. JONES, Circuit Judge,

text:
    STATE OF ALABAMA, ex rel. its GOVERNOR AND its ATTORNEY GENERAL, Plaintiff-Appellant, v. John M. ENGLER, in his official capacity as Governor of the State of Michigan, Defendant-Appellee, Phillip Chance, Movant-Appellee.
    No. 94-2436.
    United States Court of Appeals, Sixth Circuit.
    Argued March 11, 1996.
    Decided June 12, 1996.

      Robert S. Harrison (briefed), Harrison & Zacks, Bloomfield Hills, MI, for James E. Folsom, Jr. and James H. Evans.
    Paul M. Newcomer (argued), Robert S. Harrison, Harrison & Zacks, Bloomfield Hills, MI, for State of Alabama.
    Robert Ianni (argued and briefed), Office of the Attorney General of Michigan, Lansing, MI, for John M. Engler.
    James Schuster, Southfield, MI, for Phillip Chance.
    Before: JONES, BOGGS, and BATCHELDER, Circuit Judges.
   BOGGS, J., delivered the opinion of the court, in which BATCHELDER, J., joined. JONES, J. (pp. 1210-11), delivered a separate concurring opinion.

BOGGS, Circuit Judge.

The State of Alabama seeks a writ of mandamus compelling the Governor of Michigan, John M. Engler, to extradite an escaped felon, Phillip Chance, who has been living in Michigan under a gubernatorial grant of “asylum” for the last fourteen years. In the district court, Engler successfully defended the action by arguing that the grant of “asylum,” however erroneous, was a final state determination of the merits of Chance’s case, and therefore deserves full faith and credit. For the reasons that follow, we disagree and reverse. Article IV, § 2, cl. 2 of the Constitution, as recently interpreted by the Supreme Court in Puerto Rico v. Branstad, 483 U.S. 219, 107 S.Ct. 2802, 97 L.Ed.2d 187 (1987), requires that Governor Engler return Chance to Alabama.

I

The Circuit Court of Choctaw County, Alabama, convicted Phillip Chance of murder on April 30, 1973. After serving over eight years of a life sentence, Chance escaped from prison and fled to Michigan, the state of his birth. One year after the escape, in June 1982, Alabama Governor Forrest H. James, Jr., made a formal request to Michigan under the Uniform Criminal Extradition Act, 18 U.S.C. § 3182, for the extradition of Chance. In response to this request, Michigan Governor William G. Milliken held an “Extradition Hearing” on September 22, 1982. Governor Milliken then granted Chance “asylum” from Alabama because of Chance’s “very fine character” and “the support of family and friends.” Letter, Governor Milliken to Governor James, October 5,1982.

Alabama unsuccessfully asked Governor Milliken to reconsider his opinion in November 1982. Letter, Attorney General Charles A. Graddick to Governor Milliken, November 8,1982. Alabama reminded Governor Milliken of “the language of the Extradition Clause” and the fact that Chance “remains a convicted felon.” Ibid. Governor Milliken nevertheless refused. When Governor Mil-liken’s term expired, Alabama tried its luck with his successor, James J. Blanchard, in May 1984. Finding “no new evidence which would convince one that Governor Milliken’s decision should be altered,” Governor Blanchard denied Alabama’s request. Letter, Governor Blanchard to Governor George C. Wallace, January 12,1984.

Chance has spent the last fourteen years at liberty in Michigan. Alabama, however, has continued to report him as a fugitive on the list of wanted persons kept by the National Criminal Information Center (NCIC). At least ten times since his escape, local police in Michigan have stopped Chance, and then arrested him, at least in part, because of the NCIC listing. After each arrest, the police contacted the Alabama Department of Corrections. The Department of Corrections informed the local police of Chance’s status, and Alabama’s continuing desire for extradition. On each occasion, however, the local police simply released Chance.

The last such arrest occurred on October 19, 1993. After it learned of the subsequent release, Alabama made its fourth formal request to Michigan for extradition. Governor John M. Engler denied the request. Perhaps encouraged by the Supreme Court’s 1987 Branstad decision, discussed below, Alabama filed this action for a declaratory judgment and a writ of mandamus.

In the proceedings below, Governor Engler conceded that, because of Branstad, a federal court has the power to enforce the constitutional duty to extradite a fugitive. Governor Engler also conceded that a Governor has no power to refuse to extradite a fugitive based on the merits of the fugitive’s case. See Branstad, 483 U.S. at 225, 107 S.Ct. at 2807 (quoting Kentucky v. Dennison, 65 U.S. (24 How.) 66, 103, 16 L.Ed. 717 (1861) (Governor has duty to extradite “without any reference to the character of the crime charged, or to the policy or laws of the State to which the fugitive has fled.”)). Instead, Governor Engler’s defense rested on two contentions. First, the Full Faith and Credit Clause of the Constitution requires Alabama to respect Governor Milliken’s grant of asylum to Chance. Second, the power of federal courts to enforce the Extradition Clause under Branstad is “a new rule” under Teague v. Lane, 489 U.S. 288, 109 S.Ct. 1060, 103 L.Ed.2d 334 (1989), and should not apply retroactively to “divest an individual ... of the liberty and freedom he enjoyed based upon his reliance” on earlier precedent. Order, December 6, 1994, at 5.

The district court held that Governor Mil-liken’s decision to grant Chance “asylum” in 1982 was “technically unconstitutional.” However, the court agreed with Governor Engler that Alabama must give Governor Milliken’s unconstitutional decision Full Faith and Credit. Order at 9-12. The district court also agreed that Branstad announced a new rule under Teague, and that the new rule could not be used to collaterally attack a “final state determination” that Chance deserved asylum. Order at 16-17. As a result, the district court issued a peculiar order — one that mirrors the state of the law of extradition in 1861, as discussed below. It granted Alabama’s request for a declaratory judgment that Engler was constitutionally obligated to return Chance, but it “decline[d] to obligate [Engler] to extradite him.” Order at 22. Alabama filed a timely notice of appeal.

II

The United States Constitution imposes on the Governor of each state a duty to surrender any fugitive from the justice of another state to that state upon proper request. That duty is embodied in Article IV of the Constitution and in the Extradition Act of 1793, now codified at 18 U.S.C. § 3182. Until 1987, the courts of the United States were without jurisdiction to enforce the Extradition Clause because of the Supreme Court’s 1861 opinion in Kentucky v. Dennison, decided on the eve of the Civil War. 65 U.S. (24 How.) 66 (although duty to extradite is mandatory, federal court cannot force state governor to extradite). In 1987, the Supreme Court abandoned this restriction on federal jurisdiction as an anachronism. Branstad, 483 U.S. at 228, 107 S.Ct. at 2808 (“[Tjhere is no justification for distinguishing the duty to deliver fugitives from the many other species of constitutional duty enforceable in federal courts.”).

Alabama argues that the district court erred by focusing on the 1982 decision by Governor Milliken to grant Chance “asylum.” We agree. The relevant issue is whether the Constitution allows Governor Engler to refuse extradition now. The answer is clearly no. There are only four possible grounds for refusing to extradite a person: (a) the extradition documents facially are not in order; (b) the person has not been charged with a crime in the requesting state; (c) the person is not the person named in the extradition documents; and (d) the person is not a fugitive. California v. Superior Court, 482 U.S. 400, 407, 107 S.Ct. 2433, 2438, 96 L.Ed.2d 332 (1987). Governor Engler has not raised any of these objections, and the writ must be granted.

Even the question of whether the requesting state is bound by the Full Faith and Credit Clause or barred by Teague v. Lane should be raised in the courts of the requesting state — not decided by the Governor of the state to which the fugitive has fled. Cf. Strachan v. Colon, 941 F.2d 128, 131-32 (2d Cir.1991) (defense of laches, no matter how compelling, was not a defense to extradition, but rather a matter for the courts of the requesting state to consider on their own). In fact, we are at a loss to find any basis for the district court’s subject matter jurisdiction to decide the defenses raised by Governor Engler and Chance, who intervened in this action. The defenses are not relevant to the federal question of whether the extradition of Chance is required by the Extradition Clause or the Act, because the claims are not valid defenses to a request for extradition. The Declaratory Judgment Act is no help to Chance because he cannot seek a declaration that he has a constitutional defense to a pending state prosecution or re-prosecution. Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971). Finally, we could not even construe Chance’s intervention as some sort of petition for habeas corpus relief against Alabama, because Chance is not yet in Alabama’s custody. 28 U.S.C. § 2254(a); Garlotte v. Fordice, — U.S. -, -, 115 S.Ct. 1948, 1951, 132 L.Ed.2d 36 (1995).

Ill

Moreover, it is not necessary to rest a reversal of the district court’s denial of a writ of mandamus solely on the court’s lack of subject matter jurisdiction. Governor Engler’s defenses are wholly without merit.

First, the district court held that Alabama must defer to Governor Milliken’s decision because that decision was a “public act” for the purposes of the Full Faith and Credit Clause. Even assuming that the Governor’s decision was a “public act” in the face of Carroll v. Lanza, 349 U.S. 408, 411, 75 S.Ct. 804, 806, 99 L.Ed. 1183 (1955) (“public act” refers to a statute), it was a public act that Michigan was expressly forbidden from, performing. Kentucky v. Dennison, 65 U.S. at 103. A state adjudication — whether by court or governor — merits no full faith and credit if entered wholly without jurisdiction. Such a decision is void from the inception, and other courts must treat it as the legal nullity it is. Hooks v. Hooks, 711 F.2d 935, 950 (6th Cir.1985).

Chase argues in his brief that Governor MMken’s determination that he had jurisdiction is entitled to full faith and credit, as well as the governor’s resolution of the merits of the extradition request. Chance cites Treinies v. Sunshine Mining Co., 308 U.S. 66, 60 S.Ct. 44, 84 L.Ed. 85 (1939) (Washington state court bound by Idaho court’s erroneous holding that Idaho court had subject matter jurisdiction to decide an issue of Washington law). Treinies is but one case standing for the general proposition that “full faith and credit extends to state court determinations of subject matter jurisdiction over a controversy, as well as the merits of the controversy itself.” Hooks, 771 F.2d at 950. But such cases are grounded on the necessary ability of courts to determine the reach of their jurisdiction — usually a question of statutory interpretation. Cf. Jones v. Giles, 741 F.2d 245, 248 (9th Cir.1984) (“An error in interpreting a statutory grant of jurisdiction is not ... equivalent to acting with total want of jurisdiction and does not render a judgment a complete nullity.”). The Court in Treinies noted that the “power of the Idaho court to examine into the jurisdiction of the Washington court is beyond question. Even where the decision against the validity of the original judgment is erroneous, it is a valid exercise of judicial power by the second court.” 308 U.S. at 78, 60 S.Ct. at 50. There is no such power of the Governor of Michigan to examine the validity of an Alabama criminal conviction — and any state law purporting to confer such a power would be patently unconstitutional. We have held that where jurisdictional defects are patent, or where there is a “total want” of jurisdiction, the Full Faith and Credit Clause does not apply. Hooks, 771 F.2d at 950.

Second, the district court held that Branstad cannot be applied “retroactively” because it is a new rule under Teague v. Lane. The use of Teague makes no sense in the context of a lawless executive decision to protect a fugitive from another state’s criminal justice system. Teague concerned the finality of criminal convictions, and has never been applied to a civil proceeding (the finality of civil proceedings is governed by the doctrine of res judicata), let alone an executive hearing. Furthermore, Teague was based, in part, on the adequacy of direct review to correct major constitutional mistakes. 489 U.S. 288, 290, 109 S.Ct. 1060, 1064, 103 L.Ed.2d 334 (1989) (citing Mackey v. United States, 401 U.S. 667, 675, 91 S.Ct. 1160, 1164-65, 28 L.Ed.2d 404 (1971) (Harlan, J., concurring)). An executive decision by the Governor of Michigan is not reviewable by state courts, Germaine v. Governor, 176 Mich. 585, 142 N.W. 738 (1913) (Michigan courts have no power to issue writ against governor), and therefore not reviewable by the Supreme Court on writ of certiorari. As a final matter, Teague, like the res judicata and full faith and credit doctrines, presupposes that there was a valid, final determination of the merits of an issue by a court, state official, or state legislature, of competent jurisdiction. Governor Milliken’s exercise of authority to decide the merits of Chance’s case was itself illegal. As a matter of law, therefore, there is nothing for Alabama to “collaterally attack.”

IV

The Constitution forbids Governor Engler from refusing a proper request for extradition — regardless of the reasons he gives or the merits of any particular felon’s case. We therefore REVERSE the district court’s denial of the writ of mandamus, and direct that the writ issue.

NATHANIEL R. JONES, Circuit Judge,

concurring.

The court’s opinion accurately reflects the profile of extradition law today and appropriately reaffirms the power of the federal judiciary to enforce the terms of the Constitution of the United States and insure compliance by all States in the Union. Further, I agree with the opinion, that the arguments presented by Michigan are not legally persuasive. Nonetheless, I write separately to express my distress at being unable to affect the return of a citizen of this Country, or any human being, to a jurisdiction and prison system with a wretched history and, even more distressing, a present demeanor violative of international standards on the treatment of all prisoners.

Certainly, it is no secret that justice in the state of Alabama, particularly for the African-American, has been invisible or peculiar for all too much of that state’s history. The instant case has reminded me of the Scottsboro saga, specifically, the plight of Haywood Patterson and Clarence Norris, two of nine African-American young men wrongfully charged, convicted, and sentenced (some to death) in Scottsboro, Alabama for the fabricated rape of two white women. See Powell et al. v. Alabama, 287 U.S. 45, 53 S.Ct. 55, 77 L.Ed. 158 (1932); Norris v. Alabama, 294 U.S. 587, 55 S.Ct. 579, 79 L.Ed. 1074 (1935); see generally Clarence Norris and Sybil D. Washington, The Last of the Scottsboro Boys: An Autobiography (1979). Patterson escaped from an Alabama prison detail, later to be granted “asylum” by Michigan Governor G. Mennen Williams. I shudder to think what would have happened to Patterson had he been returned to Alabama. Providently, Alabama Governor George Wallace pardoned Norris in October 1976, forty-five years after he was wrongfully accused, twenty-five of which he spent in Alabama prisons. Although the similarities of the Scottsboro cases and the instant case presumably begin and end with Patterson’s and Chance’s escape from Alabama and asylum in Michigan, I can not help but pause and reflect.

Today, Chance will not be faced with lynch mobs or counterfeit retrials. He will, however, be tossed into a prison system that has adopted the barbaric “discipline” of the chain gang. This perpetuation of injustice cloaked in the tattered cloth of the Alabama justice system is deplorable. Equally offensive is the position recently espoused by an Alabama State Senator, riding what he obviously believes to be a popular political current, declaring slavery “good for blacks.” See Bible Backed Slavery, Says a Lawmaker, N.Y. Times, May 10, 1996. In this current climate, reminiscent of the “Old South,” which to some extent has been exported to other parts of the country, already difficult decisions are made more so for sensitive state officials forced to render prisoners, particularly African-American prisoners, back to jurisdictions like Alabama, which appear determined to resurrect harsh and inhumane treatment.

Even in the face of these strong reservations, the law must be followed. I only wish, however, that penal institutions will soon shed rather than irrationally embrace socially vindictive policies and procedures soundly condemned as violations of international human rights norms. See Chain-gangs Reintroduced in State Prisons, Amnesty International News, Vol. 26 No. 1, January 1996. If South Africa can sign a new democratic Constitution and Pakistan can take steps toward a ban on flogging, surely, the state of Alabama, in the United States of America, can learn from its lamentable past and embrace I hope modest principles of human rights, so, for the sake of Philip Chance.

      . Engler also argued that Alabama’s request is barred by the doctrine of laches because Alabama waited too long before making the 1993 request, but Engler does not appeal the district court's rejection of his laches defense.

      . Actually, the “asylum” hearing also violated the law of Michigan, although the Supremacy Clause renders this point of only secondary interest for the resolution of this appeal. Michigan adopted the State Uniform Criminal Extradition Act in 1937. The State Uniform Act is nearly identical to the federal Uniform Criminal Extradition Act, and calls for summary extradition upon proper request. M.C.L.A. § 780.1 et seq. See also Ala.Code 15-9-20 (same). Nothing in the State Uniform Act, nor anywhere else in the statutes of Michigan, suggests the possibility of "asylum.” Cf. People v. Marsh, 125 Mich. 410, 84 N.W. 472 (1900) (governor’s powers of clemency are limited to "procedures and regulations prescribed by law”). The only mention of a power to grant "asylum” appears in Governor Milliken's own Notice of Extradition Hearing, Memorandum in Support of Plaintiff's Motion for Summary Judgment, at Exhibit B. That document announces that the "Executive Authority” shall consider three of the defenses that a state can consider without violating the Constitution,
      (a) The legality and formality of the extradition papers;
      (b) Whether or not the accused was in the demanding State at the time the offense was committed;
      (c) The identity of the accused; and one defense that a state cannot,
      (d) Equitable considerations as may be subject to executive clemency.

        Ibid.

      . I respect the unfortunate limitation of our judicial review of an extradition request — indeed Michigan's limitations in reviewing Alabama's request — and recognize that my misgivings cannot serve as a basis for refusal to extradite. Opinion at [1207], citing Branstad, 483 U.S. at 225, 107 S.Ct. at 2806-07, quoting Kentucky v. Dennison, 65 U.S. at 103.


source: Caselaw Access Project

author: KRUPANSKY, Circuit Judge. BATCHELDER, Circuit Judge,

license: Public Domain

text:
    Kimberly TURIC, Plaintiff-Appellee, Cross-Appellant, v. HOLLAND HOSPITALITY, INC., d/b/a Holiday Inn and Conference Center of Holland, Defendant-Appellant, Cross-Appellee.
    Nos. 94-1424, 94-1467.
    United States Court of Appeals, Sixth Circuit.
    Argued May 25, 1995.
    Decided June 17, 1996.
    Rehearing and Suggestion for Rehearing En Banc Denied July 24, 1996.

      William J. Heaphy (argued and briefed), Vandeveer & Garzia, Holland, MI, for plaintiff-appellee, cross-appellant.
    Sheila A. Kinney (argued and briefed), Patterson, Kinney & Ruga, Grand Rapids, MI, for defendant-appellant, cross-appellee.
    Karen M. Moran (argued and briefed), E.E.O.C., Washington, DC, for amicus curiae.

      Louise Melling, American Civil Liberties Union Foundation, New York City, Paul Denenfeld, Detroit, MI, for American Civil Liberties Union, American Civil Liberties Union of Michigan in No. 94-1467.
    Before: KRUPANSKY, MILBURN, and BATCHELDER, Circuit Judges.
   KRUPANSKY, J., delivered the opinion of the court, in which MILBURN, J., joined. BATCHELDER, J., delivered a separate concurring opinion.

KRUPANSKY, Circuit Judge.

Defendant-Appellant, Holland Hospitality, Inc. (“Holland Hospitality”), appealed the district court’s award of compensatory damages, punitive damages and backpay to plaintiff, a former restaurant busser and room service attendant at its Holiday Inn in Holland, Michigan, under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-2(a)(l) (1991), as amended by the Pregnancy Discrimination Act (“PDA”). The court found that Holland Hospitality discharged Turic because she had become the subject of controversy among the hotel staff as a result of her perpended abortion. The court concluded, as a matter of law, that Turic’s termination for the stated reason constituted gender-based discrimination which violated Title VII. Holland Hospitality appealed, asserting Turic’s termination resulted from her failure to perform her assigned responsibilities. Holland Hospitality also appealed the court’s legal conclusions that Title VII and the broad language of 42 U.S.C. § 2000e-2(a)(l) extend equal protection to contemplated abortions and permit the award of compensatory damages, punitive damages and backpay.

In considering Turic’s first assignment of error, this Court notes that Title VII of the CM Rights Act of 1964 prohibits employers from “discharg[ing] any individual ... because of such individual’s ... sex.” 42 U.S.C. § 2000e-2(a)(l). In 1978, Congress enacted the Pregnancy Discrimination Act (“PDA”), an amendment to Title VII, to insure that discrimination against women because of pregnancy was covered by Title VII. Section 2000e(k) states:

The terms ‘because of sex’ or ‘on the basis of sex’ include, but are not limited to, because of or on the basis of pregnancy, childbirth, or related medical conditions; and women affected by pregnancy, childbirth, or related medical conditions shall be treated the same for all employment-related purposes, including receipt of benefits under fringe benefit programs, as other persons not so affected but similar in their ability or inability to work, and nothing in section 2000e-2(h) of this title shall be interpreted to permit otherwise. This subsection shall not require an employer to pay for health insurance benefits for abortion, except where the life of the mother would be endangered if the fetus were carried to term, or except where medical complications have arisen from an abortion: Provided, That nothing herein shall preclude an employer from providing abortion benefits or otherwise affect bargaining agreements with regard to abortion.

42 U.S.C. § 2000e(k). The lower court concluded that pregnancy “related medical conditions” included the right to an abortion. The EEOC guidelines interpreting this section, which are entitled to a high degree of deference under Griggs v. Duke Power, 401 U.S. 424, 433-34, 91 S.Ct. 849, 854-55, 28 L.Ed.2d 158 (1971), expressly state that an abortion is covered by Title VII:

The basic principle of the [PDA] is that women affected by pregnancy and related conditions must be treated the same as other applicants and employees on the basis of their ability or inability to work. A woman is therefore protected against such practices as being fired ... merely because she is pregnant or has had an abortion.

Appendix 29 C.F.R. 1604 (1986) (emphasis added). Similarly, the legislative history of section 2000e(k) provides:

Because [the PDA] applies to all situations in which women are “affected by pregnancy, childbirth, and related medical conditions,” its basic language covers women who chose to terminate their pregnancies. Thus, no employer may, for example, fire or refuse to hire a woman simply because she has exercised her right to have an abortion.

H.R.Conf.Rep. No. 95-1786, 95th Cong., 2d Sess. 4, reprinted in 1978 U.S.C.C.A.N. pp. 4749, 4765-66 (emphasis added). Thus, the plain language of the statute, the legislative history and the EEOC guidelines clearly indicate that an employer may not discriminate against a woman employee because “she has exercised her right to have an abortion.” Additionally, the Supreme Court has already considered the impact of the PDA in broadening the scope of prohibited sex discrimination under Title VII. In International Union v. Johnson Controls, Inc., 499 U.S. 187, 111 S.Ct. 1196, 113 L.Ed.2d 158 (1991), the Court held that Title VII, as amended by the PDA, “prohibit[s] an employer from discriminating against a woman because of her capacity to become pregnant unless her reproductive potential prevents her from performing the duties of her job.” Id. at 206, 111 S.Ct. at 1207. In light of the plain language of the statute, the legislative history of the PDA, the EEOC guidelines, and the principles of Johnson Controls, the panel concludes that an employer who discriminates against a female employee because she has “exercised her right to have an abortion” violates Title VII.

Turic, however, did not claim, nor did the district court find, that she was terminated because she had exercised her right to have an abortion. Turic v. Holland Hospitality, Inc., 849 F.Supp. 544, 551 (W.D.Mich.1994). (In fact, Turic did not terminate her pregnancy, but carried it to term.) Rather, Turic’s claim, and the district court’s conclusion, was that she was fired because she contemplated having an abortion. The panel concludes, however, that this distinction has no effect on its result. A woman’s right to have an abortion encompasses more than simply the act of having an abortion; it includes the contemplation of an abortion, as well. Since an employer cannot take adverse employment action against a female employee for her decision to have an abortion, it follows that the same employer also cannot take adverse employment action against a female employee for merely thinking about what she has a right to do. As a result, the district court’s legal conclusion that Title VII, as amended by the PDA, applies to the action of Holland Hospitality in discharging Turic, is affirmed.

The district court’s factual findings, including a finding of discriminatory intent in a Title VII nonjury case, are reviewed under a clearly erroneous standard. Anderson v. City of Bessemer, 470 U.S. 564, 573-74, 105 S.Ct. 1504, 1511, 84 L.Ed.2d 518 (1985) (“If the district court’s account of the evidence is plausible in light of the record viewed in its entirety, the court of appeals may not reverse it.”) In Title VII cases, the plaintiff bears the initial burden of establishing a prima facie ease. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S.Ct. 1817, 1824, 36 L.Ed.2d 668 (1973); Ang v. Procter & Gamble Co., 932 F.2d 540, 548 (6th Cir.1991).

Once an employee has carried her initial burden, the burden of going forward shifts to the employer to produce evidence of a legitimate, nondiseriminatory reason for the adverse treatment. Texas Dep’t of Comm. Affairs v. Burdine, 450 U.S. 248, 254, 101 S.Ct. 1089, 1094, 67 L.Ed.2d 207 (1981). If the employer satisfies its burden, the presumption of unlawful discrimination is nullified, and the burden returns to the employee to prove that the employer’s reason was pretextual. Id.

In the instant case, the trial judge found that Turic’s pondered abortion, which precipitated a controversy among the other employees, was a motivating factor for her discharge. The judge credited evidence that Turic’s initial disciplining occurred only after other employees became aware of her contemplated action. Also, the record reflects that poor job performance was not discussed during the first meeting with Turic. At trial, the supervisors admitted that they had later edited Turic’s personnel file and “expounded” on the record to add derogatory information about Turic’s prior failure to properly call in sick and her failure to fill coffee urns. Furthermore, the judge, after viewing the defendant’s witnesses and weighing their testimony, assigned greater credibility to Turic’s evidence. He concluded that Turic was discharged because she was considering an abortion. Because the trial court’s factual findings were not clearly erroneous, the court’s decision regarding liability under Title VII is affirmed.

Holland Hospitality has also appealed the award of compensatory damages, punitive damages and backpay. The Civil Rights Act of 1991 amended Title VII to authorize an award of compensatory damages where an employer is found to have “engaged in unlawful intentional discrimination....” 42 U.S.C. § 1981a(a)(1). To be eligible for compensatory damages, Turic was required to prove that Holland Hospitality’s unlawful actions caused her emotional distress. Carey v. Piphus, 435 U.S. 247, 263-64, 98 S.Ct. 1042, 1052-53, 55 L.Ed.2d 252 (1978). A plaintiffs own testimony, along with the circumstances of a particular case, can suffice to sustain the plaintiffs burden in this regard. Meyers v. City of Cincinnati, 14 F.3d 1115, 1119 (6th Cir.1994). A trial court’s finding of fact on this issue is not reversible error “unless it manifests plain injustice, or is so grossly excessive as to be clearly erroneous.” Id.; Anderson v. City of Bessemer, 470 U.S. 564, 573, 105 S.Ct. 1504, 1511, 84 L.Ed.2d 518 (1985).

The court, in the instant proceeding, found that as a young, unwed mother who was walking an “economic tightrope” and who had just discovered she was pregnant for a second time, Turic was in a particularly vulnerable position and was highly dependent upon her job. Vulnerability is relevant in determining damages. See Pratt v. Brown Machine Co., 855 F.2d 1225, 1240 (6th Cir.1988); EEOC Policy Guide at 10-11, reprinted in 8 Fair Employment Practices Manual (BNA) at 405:7096-97 (“The fact that the complaining party may be unusually emotionally sensitive and incur great emotional harm from discriminatory conduct will not absolve the respondent from responsibility for the greater emotional harm.”); Williamson v. Handy Button Machine Company, 817 F.2d 1290, 1294 (7th Cir.1987) (“Perhaps [plaintiff] was unusually sensitive, but a tortfeasor takes its victims as if finds them.... In some cases unusual sensitivity will enhance the loss; in others unusual hardiness will reduce it; payment of the actual damage in each case will both compensate the victim and lead the injurer to take account of the full consequences of its acts.”) citing Vosburg v. Putney, 80 Wis. 523, 50 N.W. 403 (1891) and Stoleson v. United States, 708 F.2d 1217, 1221 (7th Cir.1983). Turic’s vulnerability is particularly relevant in this case, because her supervisors had direct knowledge of her vulnerability before they discharged her. The trial judge did not err, therefore, in considering the unusual economic and emotional sensitivity of this plaintiff.

It is well settled that Title VII plaintiffs can prove emotional injury by testimony without medical support. Moody v. Pepsi-Cola Metropolitan Bottling Co., 915 F.2d 201, 210 (6th Cir.1990); Williams v. Trans World Airlines, 660 F.2d 1267, 1273 (8th Cir.1981). However, damages for mental and emotional distress will not be presumed, and must be proven by “competent evidence.” Carey v. Piphus, 435 U.S. 247, 263-64 & n. 20, 98 S.Ct. 1042, 1052-53 & n. 20, 55 L.Ed.2d 252 (1978); Rodgers v. Fisher Body Div., General Motors Corp., 739 F.2d 1102 (6th Cir.1984). In the instant case, Turic offered evidence which satisfied Carey. Witnesses testified that Turic was extremely upset and frightened after being discharged, and that she ran from the meeting in tears. The Supreme Court in Carey instructed that such witness testimony bolsters a finding of emotional distress: “Although essentially subjective, genuine injury in this respect may be evidenced by one’s conduct and observed by others.” Carey, 435 U.S. at 264 n. 20, 98 S.Ct. at 1052 n. 20. Further, Turic testified that she continued to suffer nightmares, weight loss during her pregnancy (an undesirable occurrence often leading to low birth weight of the baby), and excessive nervousness. This testimony distinguishes the instant ease from Rodgers, 739 F.2d at 1108, in which the plaintiff failed to testify that he suffered any manifestations of his alleged mental distress, and from Erebia v. Chrysler Plastic Products Corp., 772 F.2d 1250 (6th Cir.1985), wherein the plaintiff testified merely that he was “highly upset” about racial slims made at his workplace. Id. at 1259. See also DeNieva v. Reyes, 966 F.2d 480, 487 (9th Cir.1992) (plaintiff testified to suffering emotional distress manifested by insomnia, dizziness and vomitting and received $50,000 compensatory damages); Secretary of HUD v. Blackwell, 908 F.2d 864, 872-73 (11th Cir.1990) ($40,000 award upheld on basis of testimony regarding humiliation, insomnia and headaches); Moody v. Pepsi-Cola Metropolitan Bottling Co., 915 F.2d 201, 210 (6th Cir.1990) ($150,000 award upheld on basis of testimony that plaintiff was shocked and humiliated and forced to five apart from family because of termination). For the above reasons, the amount awarded as compensatory damages is not grossly excessive, and the decision of the court below as to compensatory damages is affirmed.

The Civil Rights Act of 1991 also provides for awards of punitive damages where an employer is found to have “engaged in a discriminatory practice ... with malice or with reckless indifference to the federally protected rights of an aggrieved individual.” 42 U.S.C. § 1981a(b)(l). A review of the record reveals that, although the actions of Holland Hospitality’s employees were duplicitous and disclosed a lack of empathy, they did not rise to the level to support a punitive damages award under the Civil Rights Act of 1991. Therefore, the trial court’s award of punitive damages is reversed.

The court’s award of 15 months backpay, at $680 per month, reduced by (1) $800 Turic realized from working at Denny’s after the baby was born; and (2) the amount attributable to the six weeks she was out of the work force after the birth of her baby was not clearly erroneous in light of her effort to seek employment at various factories and restaurants. The court’s decision is therefore affirmed as to backpay.

Accordingly, the decision below is AFFIRMED in part and REVERSED in part.

BATCHELDER, Circuit Judge,

concurring.

Title VII prohibits an employer from intentionally taking any adverse employment action against an employee on the basis of a protected attribute of that employee. ' Because most of the attributes protected under Title VII are both facially clear from the language of the statute and obvious, if not immutable, as a matter of fact, the requirement that the discrimination be intentional is neither ambiguous nor unfair in most Title VII situations, and, indeed, serves as a protection for the employer. An employer cannot argue, with a straight face, that he did not understand from the statute that he could not discriminate against an employee because the employee was, for example, black, or female or Russian Orthodox. In the present ease, however, the protected attribute is not expressly set out in the statute, and no court, at the time Holland Hospitality, Inc., discharged Turic, had included a “per-pended” or “pondered” or even a contemplated abortion as an attribute protected by the statute. In part, of course, that is because a “perpended” or “pondered” event is not an attribute at all, but a thought.

It is not readily apparent from the language of the statute that thoughts are intended to be covered by its protections. For that matter, it is not readily apparent from the statute that the status of having had an abortion is a protected attribute. As a matter of logic, however, I can accept the conclusion that since the condition of pregnancy is specifically protected, and the EEOC regulations state that the status of having undergone an abortion is protected, the contemplation of the choice to undergo an abortion must also be protected under Title VII. It is nonetheless troubling to conclude, as the next step, that discrimination based on the employee’s contemplation of an abortion is “unlawful intentional discrimination” that results, not only in an award of backpay under Title VII, but an award of compensatory damages under 42 U.S.C. § 1981a.

That is particularly so here, where Turic was the center of the vortex and the employer terminated her to get rid of the source of the uproar. However, because Turic’s contemplation of an abortion was the reason for the uproar, Turic’s termination (and thus the unlawful discrimination) was, at least in part, due to the “perpended abortion.” Since the statute makes no exception for discriminatory acts that an employer would not reasonably have known to be prohibited, Turic’s discharge, therefore, was “unlawful intentional discrimination.”

I concur in the majority opinion only because, in light of the specific language of 42 U.S.C. § 1981a, I can find no basis on which to hold that Holland Hospitality, Inc., had to have knowledge that Turic’s thoughts were protected under Title VII in order for its action to be a violation of the statute.

      . Turic cross-appealed the district court’s finding that her evidence was insufficient to support her religious discrimination claim. The record disclosed no evidence which contradicted the district court’s finding. The district court’s decision concerning the religious discrimination claim is therefore affirmed.


author: DIANE P. WOOD, Circuit Judge.

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Kermit GABEL, Defendant-Appellant.
    No. 94-3425.
    United States Court of Appeals, Seventh Circuit.
    Argued Nov. 27, 1995.
    Decided May 30, 1996.

      Joseph Hartzler, Timothy Bass (argued), Office of the United States Attorney, Springfield, IL, for Plaintiff-Appellee.
    Howard W. Feldman (argued), Feldman & Wasser, Springfield, IL, for Defendant-Appellant.
    Before POSNER, Chief Judge, and BAUER and DIANE P. WOOD, Circuit Judges.
   DIANE P. WOOD, Circuit Judge.

For an apparently significant period of time, Kermit Gabel made a living by stealing other people’s property, disposing of the stolen goods in various creative ways, and laundering the proceeds. In 1993, however, the law caught up with him (not for the first time), and he was indicted by a federal grand jury on eleven counts, most of which related to illegal structuring of transactions or money laundering. He pleaded guilty to two of those counts, and he now appeals, asserting that the district court committed several errors at the sentencing stage. Although we find no merit to Gabel’s challenges to his offense level or fine, we agree that the district court erred when it increased his criminal history category by three points based on a 1974 conviction, pursuant to U.S.S.G. § 4A1.2(e)(l). We therefore vacate the sentence and remand for further proceedings.

I

In his plea agreement, Gabel admitted to the following facts that supported his conviction. From July 1988 until his arrest on February 7, 1993, he burglarized private homes and stole jewelry and silver goods. He arranged for several shipments of stolen goods to be shipped from Illinois to a purchaser in Louisiana, and he had one shipment transported interstate to a Minnesota purchaser. Both purchasers paid for the goods by cheek. When Gabel received the cheeks, he deposited them in bank accounts under the name “Roy Post.” The record reflects at least two “Roy Post” bank accounts used by Gabel in Illinois: an account at Bank One of Springfield, Illinois and an account at First National Bank, also in Springfield.

On January 8 and 9, 1992, Gabel “structured” the withdrawal of $15,000 in currency from the “Roy Post” account at Bank One by withdrawing equal amounts of $7,500 on each of the two days. At that time, Gabel knew of Treasury Regulation 31 C.F.R. § 103.22(a) which requires domestic financial institutions to file a Currency Transaction Report with the Secretary of the Treasury whenever the institution pays, receives or transfers $10,000 or more in U.S. currency. Gabel structured his withdrawals to evade that requirement. On or about April 27,1992, Gabel used a fake Social Security number to open an account in the name of “Roy Post” at First National Bank. He then arranged for the transfer of $100,286.03 from the Bank One account to the new First National account, hoping further to obfuscate the location, source and ownership of the money. Gabel knew that he had deposited the proceeds from the sale of stolen goods into the Bank One accounts, and that the total of those deposits exceeded the amount that he transferred to First National.

On February 7, 1993, Gabel was arrested in Macon Co., Illinois, after the Decatur police became suspicious about his possible involvement in a string of burglaries that took place in Decatur on February 5. On December 15, 1993, Gabel was charged in a federal superseding indictment with five counts of illegal structuring of transactions, in violation of 31 U.S.C. § 5324(a)(3), two counts of illegal monetary transactions, in violation of 18 U.S.C. § 1957, three counts of money laundering, in violation of 18 U.S.C. § 1956(a)(l)(B)(i), and one count of illegal transportation of stolen goods, in violation of 18 U.S.C. §§ 2 and 2314. Pursuant to a written plea agreement, Gabel pleaded guilty to Counts 1 (structuring) and 8 (money laundering) of the indictment, which the court accepted on March 24,1994. Sentencing was set for October 3,1994.

II

After the court accepted Gabel’s guilty plea, it ordered the preparation of a Presentence Report (PSR). As part of the presentence investigation, the probation office conducted an extensive analysis of Gabel’s financial condition and background. This turned out to be an iterative process. Gabel initially spoke with the probation officer and, with the officer’s help, completed certain forms that inquired about his finances. The officer also left him some forms to complete on his own and to return to the probation office. Finally, Gabel furnished the probation department with forms that authorized the release of his financial information. Upon completing its initial analysis of the information Gabel had provided, the probation officer and the prosecutor requested an additional interview with him. According to Gabel, a detailed follow-up interview in fact took place.

In the PSR, the probation office concluded that Gabel had failed to disclose some of his assets, including his ownership interest in unredeemed U.S. savings bonds, two bank accounts and his Social Security income. In addition, the office concluded that Gabel did not adequately disclose his equity interest in an airplane and in certain real estate. Throughout the investigation, in the opinion of the probation office, Gabel was attempting to minimize his financial resources, stating at one point that the FBI had seized all his assets. The PSR indicated that Gabel had willfully withheld information pertaining to the cheeking accounts and the Social Security payments in the hopes that they would remain undetected. On this basis, it recommended a two-level enhancement to the base offense level for obstruction of justice, under U.S.S.G. § 3C1.1.

After reviewing the PSR and the various objections filed by the government and Gabel, the district court determined that Gabel would be sentenced pursuant to a total offense level of 22 fpr Counts 1 and 8. The guideline for a conviction under 31 U.S.C. § 5324(a)(3) (structuring) provides for a base offense level of six, plus the number of offense levels from the table in U.S.S.G. § 2F1.1 corresponding to the value of the funds. Since Gabel was found to be responsible for structuring $83,500, the base offense level was increased six levels. U.S.S.G. § 2Fl.l(b)(l)(G). Further, since Gabel knew the funds were proceeds of an unlawful activity, the base offense level for the structuring was increased by another two levels. U.S.S.G. § 2S1.3(b)(l). Finally, the court enhanced Gabel’s offense level by two points for obstruction of justice pursuant to U.S.S.G. § 3C1.1. Thus, Gabel’s base offense level for the structuring count was 16. The initial base offense level for the money laundering count, 18 U.S.C. § 1956(a)(l)(B)(i), is 20. U.S.S.G. § 2S1.1. Because the value of the funds laundered was $590,822, the base offense level was increased by three levels. U.S.S.G. § 2Sl.l(b)(2)(D). Gabel further received a two level increase for obstruction of justice pursuant to U.S.S.G. § 3C1.1. Finally, the court gave Gabel a three level reduction for acceptance of responsibility pursuant to U.S.S.G. § 3E1.1. This resulted in a base offense level of 22 for the money laundering count. For purposes of determining the final base offense level, Counts 1 and 8 were grouped pursuant to U.S.S.G. §§ 3D1.2(b) and 3D1.3(a).

The government initially presented three grounds for the obstruction enhancement pursuant to U.S.S.G. § 3C1.1: first, Gabel attempted to escape from custody; second, he failed to inform the probation office of $15,500 in U.S. Savings Bonds; and third, he failed to disclose the existence of the two checking accounts and the social security payments. The district court did not rely on either of the first two, principally because the government advised the court that the evidence was insufficient to support an obstruction enhancement on those grounds. The government has not tried to support the enhancement on these alternative grounds on appeal. The district court was satisfied, however, that Gabel’s failure to disclose the two bank accounts (representing a total of $2,500) and the social security income ($356 monthly) was deliberate. Notably, the prosecutor did not believe it was a willful omission: he advised the court that it was more plausible that Gabel merely forgot about those assets.

On appeal. Gabel argues that the court clearly erred in finding that his omission was willful, and that the court supported its finding with nothing more than unsupported speculation. The government, now taking the opposite tack from the one it took at sentencing, argues that the district court had the discretion to overrule any objections to the PSR that were made, and that the record shows that the district court did not clearly err in its determination.

Our starting point here is the statute permitting appellate review of sentences, 18 U.S.C. § 3742, which requires us to determine whether a sentence was imposed “in violation of law” or “as a result of an incorrect application of the guidelines.” § 3742(e)(1) and (2). As we have frequently noted before, this means that we must uphold the district court’s findings of fact unless they are clearly erroneous. United States v. Gist, 79 F.3d 52, 53 (7th Cir.1996); United States v. Adames, 56 F.3d 737, 748 (7th Cir.1995); United States v. Mohammad, 53 F.3d 1426, 1435 (7th Cir.1995) citing United States v. Billops, 43 F.3d 281, 287 (7th Cir.1994), cert. denied, — U.S. -, 115 S.Ct. 1389, 131 L.Ed.2d 241 (1995). As part of that process, we look to see whether there is any evidence in the record supporting the district court’s finding. This Court will only disturb the sentencing court’s factual findings if our review of the evidence as a whole leaves us with the definite and firm conviction that a mistake has been committed. Mohammad, 53 F.3d at 1435 citing United States v. Mustread, 42 F.3d 1097, 1103 (7th Cir.1994).

The obstruction of justice guideline, § 3C1.1, provides as follows:

If the defendant willfully obstructed or impeded, or attempted to obstruct or impede, the administration of justice during the investigation, prosecution, or sentencing of the instant offense, increase the offense level by 2 levels.

In this case, the only question is whether Gabel’s failure to disclose the bank accounts and Social Security payments was willful, as the PSR claimed, or inadvertent, as he asserted. In his brief, Gabel notes that the government never asked about the accounts. In fact, he evidently left Ohio in a hurry after being convicted of a crime but before sentencing, and as he candidly says in his brief, he “was not going to be checking on historical accounts which would allow him to be traced.” He had no need for such small sums of money, because he had large sums of cash available until his arrest in Illinois on burglary charges and the subsequent seizure of his money and properties.

The district court drew the opposite inference from Gabel’s prior financial history. Gabel, it pointed out, “is a sophisticated financial planner with numerous financial holdings.” He pleaded guilty to crimes that required him to have “intimate knowledge of banking procedures and also require[d] several different locations” to hide the money. Furthermore, Gabel had gone to some trouble to avoid having the government seize his financial interests. The court concluded with these observations:

The Court is firmly convinced that Defendant is not a person who forgets about money. Having made the statement, the Court will give Defendant the benefit of the doubt on the checking accounts. Perhaps Defendant simply forgot about the accounts, although the Court doesn’t find that to be likely. The Court, however, will not find that Defendant forgot about his monthly social security payments. Defendant specifically applied for these social security benefits and began receiving payments from the Social Security Administration in February 1992. It is simply unbelievable that Defendant would forget about such benefits. Thus, the Court finds that Defendant knowingly and willfully failed to disclose his social security payment to the probation office in hopes that the payments would remain undiscovered.

Following Application note 3(h) to U.S.S.G. § 3C1.1, which lists “providing materially false information to a probation officer in respect to a presentence or other investigation for the court” as one example of the type of conduct to which the obstruction enhancement applies, the court imposed the two-level increase specified in the Guideline.

The issue here is not, as Gabel would have us believe, whether the district court erred by speculating without proper foundation about additional assets that Gabel might have had. That point is relevant, if at all, to the appropriateness and size of the fine. Everything but Gabel’s state of mind is clear: he did have the Social Security payments, he did not disclose them to the probation officer, and they did fall within the scope of the government’s request for information. The district judge had to decide whether or not to believe Gabel when he claimed that his nondisclosure was inadvertent. Short of peering into Gabel’s mind, the only way to do this is to look at the kinds of circumstantial factors on which the court relied. Gabel had proven to be quite adept in manipulating numerous sources of income through various bank accounts. His application for the Social Security benefits was not something from his distant past, but instead occurred almost contemporaneously with the two offenses to which he pleaded guilty. As in United States v. Larsen, 909 F.2d 1047 (7th Cir.1990), the question of Gabel’s intent was a factual dispute that required the district court to make a credibility determination. See United States v. Garcia, 69 F.3d 810, 815 (7th Cir.1995) (clear error review of a district court’s finding that a defendant obstructed justice within the meaning of § 3C1.1); United States v. Wright, 37 F.3d 358, 361 (7th Cir.1994) (same); United States v. Sauerwein, 5 F.3d 275, 278 (7th Cir.1993) (district court’s finding that defendant’s conduct evidenced an intent to carry out his threat is one of fact that is reviewed for clear error); United States v. Song, 934 F.2d 105, 109 (7th Cir.1991). Looking at the totality of Gabel’s behavior, including particularly his lack of cooperation with the presentence investigation, the court was entitled to conclude that the omission of the Social Security benefit payments was willful. At the very least, we see no clear error in such a conclusion.

Ill

The PSR also recommended a three point increase in Gabel’s criminal history level, based on a 1974 conviction for interstate transportation of falsely managed and forged securities, forgery of U.S. Savings Bonds, aiding and abetting the first two offenses, and mail fraud. Gabel received a four year sentence of imprisonment for those offenses, but he was paroled on December 20, 1975. For purposes of computing criminal history, the Sentencing Guidelines impose a cut-off period for prior sentences, in U.S.S.G. § 4A1.2(e)(l):

Any prior sentence of imprisonment exceeding one year and one month that was imposed within fifteen years of the defendant’s commencement of the instant offense is counted. Also count any prior sentence of imprisonment exceeding one year and one month, whenever imposed, that resulted in the defendant being incarcerated during any part of such fifteen-year period.

Application Note 8' to § 4A1.2 explains that, as used in subpart (e), the term “commencement of the instant offense” includes any relevant conduct, as defined in U.S.S.G. § 1B1.3. That section defines relevant conduct as

(a)(1)(A) all acts and omissions committed, aided, abetted, commanded, induced, procured, or willfully caused by the defendant;
that occurred during the commission of the offense of conviction, in preparation for that offense, or in the course of attempting to avoid detection or responsibility for that offense; ____

The question here is whether the burglaries and thefts to which Gabel admitted in his plea statement were “relevant conduct” for purposes of the structuring and money laundering offenses.

The burglaries and thefts are crucial for Gabel’s criminal history because of the fifteen-year rule of § 4A1.2(e)(l). As noted above, Gabel was convicted in the Northern District of Oklahoma at Tulsa on March 29, 1974, and he was paroled on December 20, 1975. If the present “offense of conviction” did not begin, for relevant conduct purposes, until some time after December 20, 1990, then the 1974 offense was too remote in time to satisfy the criteria of § 4A1.2(e)(l). It is undisputed that the indictment specifically charges in Count 1 that the structuring transaction occurred on January 8-9, 1992, and in Count 8 that the money laundering occurred on April 27, 1992. Conduct “during” the commission of the offense of conviction, or taken to avoid the offense of conviction, would by definition be too late. The question therefore is whether, as the government argues, the burglaries and thefts were acts committed “in preparation for” the offenses of conviction.

We begin by considering the elements of a structuring and a money laundering offense. In order to prove structuring, the government had to show that (1) Gabel knew of the relevant reporting requirements, (2) he structured his transaction for the purpose of evading those reporting requirements, and (3) he acted with knowledge that his conduct was unlawful. 31 U.S.C. § 5324(a)(3). See Ratzlaf v. United States, 510 U.S. 135, 114 S.Ct. 655, 126 L.Ed.2d 615 (1994); United States v. Davenport, 929 F.2d 1169 (7th Cir.1991), cert. denied, 502 U.S. 1031, 112 S.Ct. 871, 116 L.Ed.2d 776 (1992). The subsection of the money laundering statute under which Gabel was charged, 18 U.S.C. § 1956(a)(l)(B)(i), makes it a crime to conduct a financial transaction knowing that the property involved in the transaction represents the proceeds of some form of unlawful activity and knowing that the transaction is designed in whole or in part to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds. United States v. Reynolds, 64 F.3d 292, 297 (7th Cir.1995); United States v. Koller, 956 F.2d 1408, 1411 (7th Cir.1992). We take these statutes one at a time, to see if the acquisition of the property that later furnishes the proceeds is a part of either offense.

It seems plain that the illegal conduct that furnishes the money that is later involved in a structuring transaction is not part of the structuring offense itself. As this Court explained in Davenport, the purpose of § 5324(a)(3) is “to prevent people from either causing the (usually innocent) bank to fail to file a required report or defeating the goal of the requirement that large cash deposits be reported to the Internal Revenue Service by breaking their cash hoard into enough separate deposits to avoid activating the requirement.” 929 F.2d at 1173. The reporting requirement is central to this offense; it would make no difference to the Treasury if someone illegally structured a transaction to avoid reporting an exceptionally generous gift that fell above the $10,000 threshold, or if she wanted to avoid reporting the receipt of illegal proceeds. Thus, the fact that the source of Gabel’s money was his earlier spate of burglaries and thefts is immaterial to § 5324(a)(3). Opening several bank accounts, acquiring a false identification, or creating a shell corporation might qualify as preparatory acts, but there was no need to commit burglaries in order to be ready to “structure.” Conversely, if Gabel had been more immediately materialistic, he might have spent more of his illegally acquired money purchasing tangible assets, such as cars, real property, or luxury goods. In light of the elements of the structuring offense, Gabel’s admitted burglaries and thefts cannot be considered as preparatory actions within the meaning of U.S.S.G. § lB1.3(a)(1).

The government cites United States v. Eske, 925 F.2d 205 (7th Cir.1991), for the proposition that Gabel “commenced” structuring (within the meaning of § 4A1.2(e)(1)) when he engaged in the unlawful activity that generated the illegally manipulated funds. Thus, the government argues that the 1988 burglaries should be considered part of the offense of conviction (structuring) within the meaning of § lB1.2(c). However, Gabel’s plea statement, unlike the one discussed in Eske, did not “specifically establish the commission of additional offenses” within the meaning of § lB1.2(c). Rather, his statement generally identified the illegal source of the structured funds. This general statement of illegal activity contained in the plea statement cannot be considered a “stipulation” of prior crimes that will trigger “commencement” within the meaning of the Guideline.

Although at first blush the money laundering case looks closer, in the end we are convinced that the logic of Davenport controls here as well. The indictment charged that the “specified unlawful activity” that gave rise to the proceeds was the interstate transportation of stolen property, and that Gabel knew that the property represented proceeds of some form of unlawful activity. The plea statement does not specify when, during the period between July 1988 and February 1993, Gabel “caused” the shipments of stolen goods to be transported interstate to Louisiana and Minnesota. Thus, nothing in the statement would support a claim that Gabel admitted to specific relevant conduct prior to December 20,1990.

The offense of money laundering is the act of designing a transaction to conceal or disguise the nature or other identifying features of the property. This Court has held that the government is not required to trace the proceeds to a particular sale. United States v. Jackson, 983 F.2d 757, 766 (7th Cir.1993). Put differently, this offense focuses on the conversion of the fruits of the earlier crimes into other, presumably less detectable, forms. The particular nature or time of those earlier crimes is immaterial. Only when the effort to conduct the financial transaction described by the statute begins does the relevant conduct commence for money laundering itself. Before that, an individual has simply committed burglary, drug dealing, bank robbery, or any of the myriad illegal activities that might lead to ill-gotten wealth. Cf. United States v. Rodriguez, 53 F.3d 1439, 1447 (7th Cir.1995) (prosecution must only show either actual or constructive knowledge of the tainted source of funds laundered to support a conviction under § 1956(a)(1)(B)(i)); United States v. Hardwell, 80 F.3d 1471 (10th Cir.1996); Tenth Survey of White Collar Crime: Money Laundering, 32 Am.Crim.L.Rev. 499 (1995). While the statute requires that the money laundered be the fruit of an illegal act, there is no requirement that the government link the money laundered to a specific criminal act. Thus, the commission of the illegal acts cannot be considered the “commencement” of the charged offense.

We therefore conclude that the-burglaries and thefts to which Gabel admitted, which took place from 1988 until his arrest, do not constitute relevant conduct for the structuring or money laundering offenses. Without any other evidence of relevant conduct that occurred before December 20, 1990, the district court should not have added the three points to Gabel’s criminal history based upon the 1974 conviction. The extra points put Gabel in the Criminal History Category VI, and resulted in an imprisonment range of 84 to 105 months. Without them, he would have been in Criminal History Category V, and subject to a sentencing range of 77 to 96 months. Since the court imposed concurrent sentences of 104 months on Count 8 and 60 months on Count 1, it is plain that this error was material.

IV

Last, we consider Gabel’s challenge to the $50,000 fine that the district court imposed. His attorney points out that he was 63 years old at the time of his sentencing, that he was currently serving a 20 year sentence imposed by the State of Illinois for burglaries, and that “a substantial portion” of his assets were seized by the United States and forfeited. His only source of income is the Social Security payments. Gabel concedes that it is his burden to establish that he cannot pay a reasonable fine, but he urges us to overturn the district court’s findings of fact on the ground that there is no evidence to support them.

The district court looked to a number of possible sources of money that Gabel might be able to tap. First, the court noted that Gabel transferred his unencumbered title in an airplane worth $20,000 to $30,000 to another individual following his arrest in this ease. The other individual has agreed not to sell the plane pending resolution of Gabel’s case, and the government was prepared to seek to void the transfer so that the equity in the plane would be available for the fine. Second, Gabel purchased U.S. Savings Bonds worth more than $15,000 in 1992, which have not been redeemed. Although there was some indication that Gabel had transferred them to another person, the court thought that he might be able to recover them and use them for the fine. Third, the court found that Gabel had transferred his title to certain real properties in Ohio with an equity in excess of $85,000 to his girlfriend when he fled from the Ohio authorities. If the girlfriend returns them, they would also be available. The court also mentioned two or three other potential sources of money, ending the list with the $356 monthly social security checks. Looking at the overall record, and again taking into account Gabel’s financial creativity, the district court concluded that Gabel had the wherewithal to pay the $50,000 fine. Interestingly, the court waived the interest requirement on the fine.

Although the matter is close, we cannot say that the district court clearly erred in this finding. It was based on the court’s belief that Gabel himself was responsible for sheltering significant sources of income, and that it was within his power to undo that which he had done. Gabel’s fine was based on an accurate calculation of his offense level, and nothing in this opinion affects that calculation. Therefore, there is no reason for the district court to revisit the calculation of Gabel’s fine. However, we note that the district court stated an incorrect fine range in its judgment. Because Gabel’s offense level was 22, his fine range should have been $7,500 to $75,000, not $10,000 to $100,000. Since the fine assessed was well within the correct range, the district court’s error in stating the applicable range was harmless.

For the reasons stated, we accordingly Vacate the sentence and Remand for re-sentencing in accordance with this opinion.


author: EASTERBROOK, Circuit Judge. FLAUM, Circuit Judge,

text:
    David Jay STERLING, Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee.
    No. 95-1459.
    United States Court of Appeals, Seventh Circuit.
    Submitted March 19, 1996.
    Decided June 3, 1996.

      David Jay Sterling, Marion, IL, pro se.
    James M. HipMss, Office of U.S. Atty., Civ. Div., Fairview Heights, IL, for U.S.
    Before FLAUM, EASTERBROOK, and ROVNER, Circuit Judges.
   EASTERBROOK, Circuit Judge.

The question presented by this case — which appears to be a novel issue — is whether someone who files and loses a Bivens suit against a federal employee is entitled to pursue a tort action against the United States. The district judge said no; we hold that the answer is yes and remand for proceedings on the merits.

David Jay Sterling alleges that, while he was a federal prisoner at Lewisburg, officer Miller either lost or intentionally destroyed a duffel bag full of legal materials. Sterling was sent to the “special housing unit.” While he was there, four bags of possessions went to storage. When he was preparing his things for transfer to another prison, Sterling says, he discovered that one of the four had vanished. He wants compensation for the value of the missing property. He sued Miller in the Middle District of Pennsylvania. While the suit was pending, Sterling escaped from custody. Three months after Sterling’s recapture, Judge Caldwell dismissed the suit against Miller as an application of-the fugitive disentitlement doctrine. Sterling did not appeal but did commence another suit, this time against the United States, under the Federal Tort Claims Act. The new suit was filed in the Southern District of Illinois, for in the interim Miller had been transferred to Marion. Judge Stiehl observed that Judge Caldwell dismissed the suit with prejudice. Because Judge Stiehl viewed the Bivens and FTCA actions as identical claims, he held that Sterling’s loss on the former meant that he must lose the latter too.

Both parties describe this as an application of “res judicata,” and the United States relies on cases that forbid sequential claims against the same party. But of course Sterling has not sued the United States twice; he sued different parties, once apiece. (Actually, he has sued Miller twice, and the second suit against Miller has been dismissed on account of res judicata, but this is not material to the suit against the United States.) Using the same term for different sequences of litigation has a substantial potential for confusion, which is why the American Law Institute recommends the replacement of “res judicata” (and “collateral estoppel”) by the more descriptive English phrases “claim preclusion” and “issue preclusion.” See Restatement (2d) of Judgments (1980). Sterling has neither litigated nor lost any claim against the United States; we do not have an instance of merger and bar. Instead the United States seeks to take advantage of Sterling’s failure in the litigation against Miller by interposing the defense usually called non-mutual issue preclusion (“non-mutual” because Sterling could not have used a victory in his suit against Miller as the basis of any relief against the United States). See Parklane Hosiery Co. v. Shore, 439 U.S. 322, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979); Restatement § 29. Liability under the Tort Claims Act is vicarious, and the United States wants to take advantage of the rule that, if an employee has been absolved of liability, there is no tort for which the employer can be vicariously liable. Restatement § 51.

The problem with applying this principle to the Bivens-FTCA sequence is that the two legal theories differ. Public liability under the FTCA does not depend on the employee’s liability under Bivens. The FTCA creates a remedy for negligence and forbids relief on account of many intentional torts. 28 U.S.C. §§ 2674, 2680(h). The domain of Bivens in a case such as this, however, is limited to intentional deprivations. Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981), which held that a negligent loss of a prisoner’s property violates the due process clause, was overruled on this point by Daniels v. Williams, 474 U.S. 327, 106 S.Ct. 662, 88 L.Ed.2d 662 (1986). To obtain damages from Miller, therefore, Sterling had to show that Miller intentionally and without justification destroyed his property. Damages could be obtained from the United States on a lesser showing — that Miller negligently lost or destroyed Sterling’s property. A victory for Miller therefore does not imply victory for the United States. Our sequence fits nicely the proviso in § 51(1)(a) of the Restatement, which covers cases in which the “claim asserted in the second action is based upon grounds that could not have been asserted against the defendant in the first action”.

Although the United States readily could lose at the same time as Miller prevailed, it may be that both the United States and Miller should prevail. When denying Sterling’s administrative claim under the FTCA, the Bureau of Prisons concluded that Miller destroyed the duffel bag and its contents because Sterling told him to do so:

On March 6, 1992, you were ordered to report to the property room of the [Special Housing Unit] to inventory your personal property. At that time, you requested that a great deal of what you referred to as “excess paperwork” be destroyed by the officer. Your request was complied with and a[sic] inventory form was completed to verify the final disposition of the papers you requested be destroyed. Therefore, the only destruction of your papers at USP, Lewisburg were [sic] at your specific request.

Does Miller’s victory establish that Sterling asked Miller to destroy the documents? Issue preclusion applies only to issues actually and necessarily resolved in the first case, Cohen v. Bucci, 905 F.2d 1111 (7th Cir.1990); Mortell v. Mortell Co., 887 F.2d 1322 (7th Cir.1989); Restatement § 27, so the United States cannot take advantage of Miller’s victory. Judge Caldwell did not actually find any fact in Miller’s favor; any finding that Sterling asked Miller to destroy the property would not have been essential to that disposition. Had Judge Caldwell found that Miller intentionally destroyed the duffel bag, then a further finding that Sterling asked him to do so would have been necessary to a decision in Miller’s favor. But Judge Caldwell did not reach the merits of Sterling’s claim, so the kind of findings that would assist the United States were not made.

Judge Stiehl believed that Sterling was obliged to join the United States as a party to the initial action in Pennsylvania, but he did not cite any authority for that proposition. Victims are free to litigate separately against joint tortfeasors. Temple v. Synthes Corp., 498 U.S. 5, 111 S.Ct. 315, 112 L.Ed.2d 263 (1990); Lawlor v. National Screen Service Corp., 349 U.S. 322, 75 S.Ct. 865, 99 L.Ed. 1122 (1955). Legal rules may make joinder difficult, and the FTCA is one of these. A victim is forbidden to file suit against the United States until first presenting an administrative claim. 28 U.S.C. § 2672. Failure to heed that requirement can cost a victim any opportunity to recover damages. McNeil v. United States, 508 U.S. 106, 113 S.Ct. 1980, 124 L.Ed.2d 21 (1993). The Bureau of Prisons did not act on Sterling’s administrative claim until shortly before the Pennsylvania case was dismissed. And the United States was in no position to make itself a party in the Pennsylvania case. Under the Westfall Act, the United States usually is substituted for a federal employee accused of committing a tort in the course of his duties; but the statute forbids substitution when the employee is alleged to have violated the Constitution, as Sterling accused Miller of doing. 28 U.S.C. § 2679(b)(2)(A). This also shows that Miller and the United States were not the “same party” on a virtual-representation theory. The Westfall Act keeps the United States and its employees distinct in constitutional-tort cases. The function of Bivens reinforces this understanding. Sterling’s original action was against Miller in his personal rather than official-capacity. See Stafford v. Briggs, 444 U.S. 527, 100 S.Ct. 774, 63 L.Ed.2d 1 (1980). Miller would have paid any judgment personally; the point of Bivens was to establish an action against the employee to avoid the sovereign immunity that would block an action against the United States, and thus would block an official-capacity action too. Kentucky v. Graham, 473 U.S. 159, 105 S.Ct. 3099, 87 L.Ed.2d 114 (1985). Miller and the United States therefore are not privies for purposes of the rules of preclusion. See Charles Koen & Associates v. Cairo, 909 F.2d 992, 999 n. 7 (7th Cir.1990); Conner v. Reinhard, 847 F.2d 384, 394-96 (7th Cir.1988).

Because the FTCA creates vicarious liability, a judgment in favor of the United States usually implies that the federal employee also is entitled to prevail, while a judgment against the United States implies that the victim has received full compensation. Congress has provided that litigation against the United States precludes a later suit against the federal employee. 28 U.S.C. § 2679(b)(1). The express prohibition on a suit against the employee following judgment in a suit against the United States — coupled with the absence of any bar on litigation against the United States following a judgment in favor of an employee — has led one court of appeals to conclude that the latter sequence is proper. Ting v. United States, 927 F.2d 1504, 1513 n. 10 (9th Cir.1991); cf. Serra v. Pichardo, 786 F.2d 237 (6th Cir.1986). These decisions do not discuss the law of issue preclusion. Now that the question has been presented squarely, we hold that a decision in the employee’s favor is not automatically preclusive in the United States’ favor. A party who wants to raise different legal theories of liability against the same defendant must present all in a single case. Herrmann v. Cencom Cable Associates, Inc., 999 F.2d 223 (7th Cir.1993). But when sequential suits name different parties, only issues actually and necessarily decided in the first case carry over to the second under the doctrine of issue preclusion. Judge Caldwell's finding that Sterling’s escape cost him his chance under Bivens does not establish against Sterling any issue pertinent to the FTCA case, which therefore must be reinstated. The judgment is vacated, and the case is remanded for further proceedings consistent with this opinion.

FLAUM, Circuit Judge,

concurring in the judgment.

I concur with the majority’s result, but I write separately because I am unable to adopt its analysis.

The issue in this case is whether Sterling’s current FTCA suit is precluded by the judgment in the previous, official-capacity civil rights action that he brought against Officer Miller (Sterling I) concerning the same transaction — the loss of his duffel bag. There can be no dispute that in Sterling I, Sterling sued Miller in both his individual and official capacities. On the first page of the complaint in Sterling I, it is clearly stated that the defendant is sued in both capacities. See R. 15, Government Exhibit 1. Our case law requires a civil rights plaintiff to designate whether a government official is sued in his individual or official capacity, see Hill v. Shelander, 924 F.2d 1370, 1372 (7th Cir.1991); see also Kolar v. County of Sangamon, 756 F.2d 564, 568-69 (7th Cir.1985), and for good reason: an individual-capacity suit seeks “to impose personal liability upon a government official,” Kentucky v. Graham, 473 U.S. 159, 165, 105 S.Ct. 3099, 3105, 87 L.Ed.2d 114 (1985), whereas an official capacity action against a government employee is essentially a suit against the government entity itself. Id. at 165-66, 105 S.Ct. at 3105; Monell v. Department of Social Services, 436 U.S. 658, 690 n. 55, 98 S.Ct. 2018, 2036 n.55, 56 L.Ed.2d 611 (1978). Whether the suit is an individual or official capacity action determines who (the individual officer or the government) is responsible for satisfying any judgment that the plaintiff might win. See Hill, 924 F.2d at 1372. Hill thus imposes a duty on the plaintiff to frame his complaint accordingly, and I believe that we must defer to Sterling’s characterization of his own lawsuit as both an individual and an official capacity action.

Because an official-capacity suit against a government official is essentially a suit against the government itself, we have held that for claim preclusion purposes, the government is in privity with officers sued in their official capacities. Gray v. Lacke, 885 F.2d 399, 405 (7th Cir.1989), cert. denied, 494 U.S. 1029, 110 S.Ct. 1476, 108 L.Ed.2d 613 (1990); Beard v. O’Neal, 728 F.2d 894, 897 (7th Cir.), cert. denied, 469 U.S. 825, 105 S.Ct. 104, 83 L.Ed.2d 48 (1984); Lee v. City of Peoria, 685 F.2d 196, 199 n. 4 (7th Cir.1982). Under the rule of Gray, Beard, and Lee, the current suit appears to be precluded by the official-capacity action in Sterling I. This, at least, was the reasoning adopted by the district court.

What complicates this case, however, is that the official-capacity action in Sterling I was doomed from the start. In his suit against Miller, Sterling sought money damages only. Because any award would come from the United States treasury, plaintiffs may not recover monetary damages in official-capacity actions against federal employees unless the United States has waived its sovereign immunity. See, e.g., Robinson v. Overseas Military Sales Corp., 21 F.3d 502, 510 (2d Cir.1994). There was no waiver of sovereign immunity that authorized the official-capacity damages claim in Sterling I. Moreover, when there has been no waiver of sovereign immunity, a court does not have subject-matter jurisdiction to entertain a damages action against the United States. In re Glacier Bay, 71 F.3d 1447, 1450 (9th Cir.1995); Wilkerson v. United States, 67 F.3d 112, 118 (5th Cir.1995). Thus, the official-capacity portion of Sterling I should have been dismissed instantly, and the dismissal for lack of subject-matter jurisdiction would have no preclusive effect (except as to the issue of subject-matter jurisdiction itself). Magnus Electronics, Inc. v. La Republica Argentina, 830 F.2d 1396, 1400 (7th Cir.1987); Lacks v. Fahmi, 623 F.2d 254, 256 (2d Cir.1980) (dismissal on ground of sovereign immunity has no “res judicata or collateral estoppel effect” as to the merits of the ease).

Regardless, however, of what should have happened, the district court did not dismiss the official-capacity action in Sterling I for lack of subject matter jurisdiction. Instead, the court assumed jurisdiction and dismissed the entire suit on the merits under Fed. R.Civ.P. 41(b). Because there was a dismissal on the merits, the elements of claim preclusion appear to be satisfied. The question thus becomes whether we should give effect to the dismissal on the merits even though the court erroneously assumed subject-matter jurisdiction over the official-capacity damages claim.

A litigant may not collaterally attack a prior judgment by simply arguing that it is incorrect. Federated Dept. Stores, Inc. v. Moitie, 452 U.S. 394, 398, 101 S.Ct. 2424, 2428, 69 L.Ed.2d 103 (1981). In addition, a judgment is generally given preclusive effect even if it was entered in the absence of subject-matter jurisdiction. See Insurance Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 n. 9, 102 S.Ct. 2099, 2104 n.9, 72 L.Ed.2d 492 (1982); Chicot County Drainage Dist. v. Baxter State Bank, 308 U.S. 371, 377-78, 60 S.Ct. 317, 320, 84 L.Ed. 329 (1940); Disher v. Information Resources, Inc., 873 F.2d 136, 139-40 (7th Cir.1989); Commodities Export Co. v. United States Customs Service, 957 F.2d 223, 228 (6th Cir.), cert. denied, 506 U.S. 831, 113 S.Ct. 96, 121 L.Ed.2d 56 (1992); United States v. Chambers, 922 F.2d 228, 239 (5th Cir.1991); Kock v. Government of Virgin Islands, 811 F.2d 240, 243 (3d Cir.1987); cf. Durfee v. Duke, 375 U.S. 106, 84 S.Ct. 242, 11 L.Ed.2d 186 (1963). This salutary approach exists because there is a need for finality in the law, and finality would be disserved if courts had to reexamine the jurisdictional basis of every prior judgment before giving it preclusive effect.

There are, however, a few exceptions to the rule that a court’s decision to exercise subject-matter jurisdiction is not open to collateral attack. For instance, if a state court takes jurisdiction over a claim that is exclusively within the province of the federal courts, its judgment is not entitled to preclusive effect. See Kalb v. Feuerstein, 308 U.S. 433, 439, 60 S.Ct. 343, 346, 84 L.Ed. 370 (1940) (state court judgment entered in violation of Bankruptcy Act not entitled to preclusive effect); Gonzales v. Parks, 830 F.2d 1033, 1036 (9th Cir.1987). In addition, the Supreme Court has held that a judgment is afforded no res judicata effect if the claim should have been dismissed on the ground of sovereign immunity. United States v. United States Fidelity & Guaranty Co., 309 U.S. 506, 514, 60 S.Ct. 653, 657, 84 L.Ed. 894 (1940); see also Blinder, Robinson & Co. v. SEC, 837 F.2d 1099, 1104 (D.C.Cir.), cert. denied, 488 U.S. 869, 109 S.Ct. 177, 102 L.Ed.2d 146 (1988). The facts of USF & G are similar to the ease here: a district court assumed jurisdiction over a claim that it should have dismissed because of sovereign immunity. USF & G, 309 U.S. at 512-13, 60 S.Ct. at 656-57. The USF & G Court held that the prior district court judgment was not entitled to preclusive effect. Id. at 514-15, 60 S.Ct. at 657-58. It may be noteworthy that the prior decision at issue in USF & G was a money judgment against a sovereign, and granting preclusive effect to that judgment would have resulted in an abrogation of sovereign immunity. See id. at 515, 60 S.Ct. at 657-58. In contrast, the decision in Sterling I was in favor of the United States, so there is no fear of preclusion resulting in a money judgment against the treasury. This appears to be a matter of first impression, but I believe that the principle recognized in USF & G should apply both ways: if the government cannot be penalized for a court’s assumption of jurisdiction in a case that should have been dismissed because of sovereign immunity, the government should not be able to benefit from it either. If a court reaches the merits of a claim that is barred by sovereign immunity, the judgment is simply void. Thus, I agree that the judgment in Sterling I should not preclude Sterling’s current suit.

Finally, I do not believe that the Westfall Act (and the plain language of the text speaks for itself) authorizes Sterling to bring sequential suits. Since I agree, however, that Sterling I does not preclude the instant suit, I concur in the judgment of the court.

      . Privity does not exist, however, between the government and an officer sued solely in his individual capacity. Charles Koen & Associates v. City of Cairo, 909 F.2d 992, 999 n. 7 (7th Cir.1990); Gray, 885 F.2d at 405. The distinction that we have recognized between the preclusive effects of individual and official capacity suits against government employees appears to conflict with the approach of the Restatement, which establishes a general rule that employers are in privity with their employees. See Restatement (Second) of Judgments § 51 and cmt. a (ALI 1982). Charles Koen and Gray thus implicitly reject § 51, at least with regard to individual capacity suits against government employees.

      . Sovereign immunily does not, however, bar a plaintiff from obtaining specific' relief in an official-capacity action when it is alleged that a government official violated the constitution or acted outside of his statutory authority. See Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 689-90, 69 S.Ct. 1457, 1461-62, 93 L.Ed. 1628 (1949); Clark v. Library of Congress, 750 F.2d 89, 102 (D.C.Cir.1984).

      . A few courts have held that a dismissal on sovereign immunity grounds operates as a dismissal on the merits for res judicata purposes. See Flores v. Edinburg Consolidated Independent School Dist., 741 F.2d 773, 775 n. 3 (5th Cir.1984) (applying Texas law); Kutzik v. Young, 730 F.2d 149, 151 (4th Cir.1984) (applying Maryland law); Bloomquist v. Brady, 894 F.Supp. 108, 116 (W.D.N.Y.1995). This understanding conflicts with our statement in Magnus that "[a] judgment dismissing a suit for lack of jurisdiction does not preclude a party from litigating the same cause of action in a court of competent jurisdiction." Magnus, 830 F.2d at 1400 (emphasis in original).

      . For claim preclusion to apply, three elements must be present:
      (1) there must be a final judgment on the merits;
      (2) the two suits must arise out of the same transaction or occurrence; and (3) both actions must involve the same parties or their privies. Doe v. Allied-Signal, Inc., 985 F.2d 908, 913 (7th Cir.1993).

      .The Restatement identifies three such exceptions:
      When a court has rendered a judgment in a contested action, the judgment precludes the parties from litigating the question of the court's subject matter jurisdiction in subsequent litigation except if:
      (1) The subject matter of the action was so plainly beyond the court’s jurisdiction that its entertaining the action was a manifest abuse of authority; or
      (2) Allowing the judgment to stand would substantially infringe the authority of another tribunal or agency of government; or
      (3) The judgment was rendered by a court lacking capability to make an adequately informed determination of a question concerning its own jurisdiction.
      Restatement (Second) Judgments § 12 (ALI 1982).

      . Such a judgment may be void under § 12(2) of the Restatement because it "infringe[s] the authority” of a sovereign.

      . If the question of sovereign immunity was actually litigated in the original suit, the parties may be precluded from relitigating the issue in a subsequent proceeding. See Durfee v. Duke, 375 U.S. 106, 111, 84 S.Ct. 242, 245, 11 L.Ed.2d 186 (1963) ("a judgment is entitled to full faith and credit — even as to questions of jurisdiction — when the second court's inquiry discloses that those questions have been fully and fairly litigated and finally decided in the court which rendered the original judgment”); In re Penn Central Transportation Co., 384 F.Supp. 895, 954 (Sp.Ct.R.R.R.A. 1974) ("We doubt that the [USF & G] case eliminates the application of collateral estoppel when the suability of the sovereign is at issue.... It is not certain that the result [in USF & G] would have been the same if a challenge to the jurisdiction of the [original] Missouri court had been made and erroneously overruled and the decision had not been appealed.”). In Sterling I, however, as in USF & G, the question of sovereign immunity was never litigated. In addition, the court's failure to dismiss Sterling's official-capacity damages claim on sovereign immunity grounds was plainly erroneous. USF & G implies that in such situations, the judgment on the merits is void.