Conner v. Mahajan, No. 17-1162 (7th Cir. 2017)Annotate this Case
After losing his job at Mutual Bank, Conner filed a qui tam action claiming that the defendants, primarily directors or officers of the bank, had defrauded the government in violation of the False Claims Act, 31 U.S.C. 3729–3733. The United States declined to take over the action, which Conner eventually settled. The Federal Deposit Insurance Corporation filed its own lawsuit against many of the same defendants. That case also settled. Conner claimed to be entitled to a share of the FDIC’s settlement proceeds and tried, unsuccessfully, to intervene in the FDIC’s case. He then filed a motion in his own suit action demanding part of the FDIC’s recovery. The district court denied that request on the ground that, because Conner’s attempt to intervene in the FDIC’s case was rejected, he is barred from litigating in this suit the question whether he has a cognizable interest in the settlement proceeds. The Seventh Circuit affirmed, holding that claim preclusion barred Conner’s recovery from the FDIC.