A. Precedents Cited
1) Standards of review and permissible materials
The court reviewed the res judicata dismissal de novo under Baek v. Clausen, and reiterated
the Rule 12 posture requirement to view facts favorably to the nonmovant as framed in
Citizens Ins. Co. of Am. v. Wynndalco Enters., LLC. It also relied on
White v. Keely to confirm that courts may take judicial notice of public records (including court documents),
which matters in preclusion disputes where prior proceedings define the litigation landscape.
2) Jurisdictional gatekeeping: Rooker-Feldman
Even though the parties did not press Rooker-Feldman on appeal, the panel emphasized its independent duty
to confirm subject-matter jurisdiction under Arbaugh v. Y&H Corp..
The court applied the Seventh Circuit’s modern, en banc articulation of the doctrine in
Gilbank v. Wood Cnty. Dep't of Hum. Servs., which in turn quotes
Verizon Md., Inc. v. Public Serv. Comm'n of Md. for the proposition that Congress has not authorized
federal district courts to exercise appellate jurisdiction over state-court judgments.
Crucially, Gilbank v. Wood Cnty. Dep't of Hum. Servs. directs courts to examine the relief sought to determine
whether the plaintiff is asking the federal court to “review and reject” a state judgment. Applying that framework, the panel
distinguished between (i) reimbursement of state-imposed fines (closer to undoing the state result) and (ii) damages for
lost revenue (which “usually does not affect a state court judgment not sounding in monetary terms”).
That distinction allowed jurisdiction over at least part of the due-process claim.
3) Illinois res judicata elements and scope
Because the prior litigation occurred in Illinois courts, the panel applied Illinois claim-preclusion principles as required by
Chi. Title Land Tr. Co. v. Potash Corp. of Saskatchewan Sales Ltd..
It then stated the elements (final merits judgment, identity of causes of action, identity of parties/privies) via
Doherty v. Fed. Deposit Ins. Corp. (quoting DeLuna v. Treister).
For the preclusion “reach,” the panel cited River Park, Inc. v. City of Highland Park (through Baek v. Clausen):
res judicata bars not only what was decided, but also what could have been decided in the first action.
This principle did much of the work against the Worthams’ federal claims.
4) Vagueness doctrine: as-applied requirement outside the First Amendment
The Worthams argued that the Illinois appellate court did not reach their “as-applied and facial” vagueness claims.
The Seventh Circuit rejected that characterization by pointing to the actual basis for the state appellate ruling:
the state court deemed the vagueness challenge baseless absent an argument that the ordinance was vague as to the Worthams’
specific conduct, citing Wortham v. Village of Barrington Hills and Shachter v. City of Chicago.
The panel reinforced the doctrinal premise with federal authority:
United States v. Pacilio (quoting United States v. Calimlim) for the rule that a vagueness challenge
not premised on the First Amendment is generally evaluated as-applied, not facially.
The upshot is that the Illinois court’s rejection—because the Worthams failed to make the necessary as-applied showing—was treated as
a merits ruling that can support res judicata.
5) Waiver/forfeiture on appeal
As to the First Amendment claim, the panel relied on Bradley v. Village of University Park:
failing to respond to an argument in the district court (here, the Village’s res judicata defense) waives that contention on appeal.
The court further noted that even the Worthams’ appellate theory (that the claim arose only after the March 2022 decision)
did not address the district court’s key point: the claim could have been raised during the subsequent April 2022 enforcement proceedings.
6) The panel’s caution about over-compartmentalized pleading analysis
In a footnote, the court criticized the district court’s tendency to offer multiple alternative grounds without committing to a clear basis,
and it signaled skepticism about rigidly splitting due-process vagueness into “facial” and “as-applied” compartments at the pleading stage.
The footnote references Star Holdings, LLC v. City of Milwaukee (quoting Citizens United v. Fed. Election Comm'n)
as part of that discussion, and it expressly warns that a conclusory Rooker-Feldman analysis illustrates the risks of the district court’s approach.
B. Legal Reasoning
1) Rooker-Feldman: narrow jurisdictional screen, focused on the relief requested
The panel treated Rooker-Feldman as a limited doctrine: it bars de facto federal appellate review of state judgments,
but it does not automatically bar all federal claims that arise after or alongside state litigation. Using
Gilbank v. Wood Cnty. Dep't of Hum. Servs. as its guide, the court looked to the requested relief and held that
at least the damages request for lost revenue would not necessarily require rejecting a state judgment. Therefore, jurisdiction existed
over that aspect of the due-process claim.
2) Res judicata: “final on the merits” includes a state court’s rejection for failure to make a required as-applied showing
The dispositive step was claim preclusion. The Worthams contested only the first Illinois element—final merits judgment—arguing that
the Illinois appellate court had not truly decided their constitutional theory. The Seventh Circuit disagreed:
the Illinois court rejected the vagueness challenge for a substantive deficiency (no argument that the ordinance was vague as applied to them),
a deficiency that is doctrinally central outside the First Amendment (as underscored by United States v. Pacilio and
United States v. Calimlim).
That treatment matters: once the state court has issued a final merits judgment rejecting the vagueness challenge, res judicata prevents a
federal “second try” at the same cause of action (and prevents repackaging closely related constitutional theories that could have been raised
in the earlier litigation, consistent with River Park, Inc. v. City of Highland Park).
3) First Amendment claim: could-have-been-litigated plus waiver
The First Amendment claim failed for two reinforcing reasons. First, on the merits of preclusion, the court accepted the district court’s
logic that the Worthams could have raised that claim during the state enforcement proceedings and did not. Second, as a procedural matter,
Bradley v. Village of University Park made the appellate result straightforward: by failing to respond to the res judicata
argument in the district court, the Worthams waived the issue on appeal.