Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca3-18-03060/USCOURTS-ca3-18-03060-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

---

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_______________

No. 18-3060

______________

FRANK A. PAPERA; CHARLOTTE E. PAPERA; 

FRANK A. PAPERA REVOCABLE TRUST,

Appellants

v.

PENNSYLVANIA QUARRIED BLUESTONE COMPANY; 

F. CONRAD AND SONS; FRED D. CONRAD; 

THERESA A. CONRAD

_______________

On Appeal from the United States District Court

for the Middle District of Pennsylvania

(D.C. No. 3:16-cv-02205)

District Judge: Honorable James M. Munley

_______________

Submitted Under Third Circuit L.A.R. 34.1(a)

on September 12, 2019

Before: HARDIMAN, GREENAWAY, JR., and

BIBAS, Circuit Judges.

(Filed: January 22, 2020)

Case: 18-3060 Document: 45 Page: 1 Date Filed: 01/22/2020
2

_______________

Harry T. Coleman

41 North Main Street

Suite 316

Carbondale, PA 18407

Counsel for Appellants

John J. Minora

Minora Minora Colbassani Ratchford Krowiak & Mattioli

700 Vine Street

Scranton, PA 18510

Counsel for Appellees

_______________

OPINION OF THE COURT

_______________

BIBAS, Circuit Judge.

We construe ambiguities in dismissal orders against claim 

preclusion. So we will not read a dismissal order as dismissing 

involuntarily, or voluntarily with prejudice, unless it says so 

clearly and expressly.

Frank and Charlotte Papera thought that they had reached a 

settlement with the defendants, so they sought a dismissal of 

their lawsuit. The District Court entered a dismissal order. It 

gave the parties sixty days to either send the Court a settlement 

agreement for its approval or move to reopen the case. But the

parties did neither. After this deadline passed, the Court simply 

closed the suit.

Case: 18-3060 Document: 45 Page: 2 Date Filed: 01/22/2020
3

When the settlement discussions fell through, the Paperas 

refiled the same complaint. The second suit came to the same 

district judge, who dismissed it based on claim preclusion. But 

claim preclusion was inapt because the Court never clearly 

stated that it was dismissing involuntarily or voluntarily with 

prejudice. So we will vacate and remand.

I. BACKGROUND

The Paperas own a quarry. They agreed to let the Pennsylvania Quarried Bluestone Company mine the property. According to the Paperas, they repeatedly asked the Company to 

clean up the property, remove abandoned equipment, and pay 

for the mined stone. The Company never did. So the Paperas 

sued it and its owners in the U.S. District Court for the Middle 

District of Pennsylvania.

The District Court sent the case to mediation. In May 2016, 

the Paperas returned with good news, reporting that the parties 

had “resolved [the case] amicably.” App. 38. They asked the 

Court for “a sixty (60) day Order of Dismissal.” Id. And they 

promised to follow up with a “Remediation Agreement,” 

which they would then ask the Court to approve. Id.

So the Court filed an order tentatively dismissing the case. 

The May 2016 Order was two sentences long, saying only that 

the case is dismissed and the parties had sixty days to finalize 

the settlement. Papera v. Pa. Quarried Bluestone Co., No. 

3:15-cv-00476, ECF No. 18 (M.D. Pa. May 10, 2016). For 

more information, the parties had to read the order’s minute 

entry: The case was dismissed “without prejudice.” App. 4 

(ECF No. 18). The parties could move “to reinstate the action 

Case: 18-3060 Document: 45 Page: 3 Date Filed: 01/22/2020
4

if settlement [wa]s not consummated.” Id. To do so, they would 

have to show good cause within sixty days. Id.

But the settlement apparently fell through. The District 

Court never got any settlement agreement. After the sixty-day 

period elapsed, the Court did not file an order dismissing with 

prejudice.

In September 2016, nearly four months after the dismissal 

order, the Paperas asked for a conference call “regarding the 

future status of the litigation.” Papera v. Pa. Quarried Bluestone Co., No. 3:16-cv-2205, 2018 WL 4051748, at *1 (M.D. 

Pa. Aug. 24, 2018). On that call, the Court reportedly told the 

Paperas that “it no longer had jurisdiction over the case” and 

that it had administratively closed it. Id.; Appellants’ Br. 20.

We have no transcript of this call.

A month later, the Paperas filed a new case in the same District Court. The new complaint was almost identical to the old 

one. This case was characterized as a related case to the original suit, so it was assigned to the same judge. 

Pennsylvania Quarried Bluestone answered the complaint 

and, after discovery, moved to dismiss it. The District Court 

properly treated this motion as a motion for summary judgment 

and, in August 2018, granted it based on claim preclusion. And 

it declined to reopen the May 2016 Order under Federal Rule 

of Civil Procedure 60(b) because the Paperas had not suffered 

“a gross injustice.” Papera, 2018 WL 4051748, at *4.

The Paperas timely appealed the grant of summary judgment. The District Court had diversity jurisdiction under 28 

U.S.C. §1332(a)(1), and we have jurisdiction under §1291. We 

Case: 18-3060 Document: 45 Page: 4 Date Filed: 01/22/2020
5

review the District Court’s grant of summary judgment de 

novo. Sheridan v. NGK Metals Corp., 609 F.3d 239, 250 n.12 

(3d Cir. 2010).

II. BECAUSE THE ORDER DISMISSING THE PAPERAS’ FIRST 

SUIT DID NOT CLEARLY SAY THAT THE DISMISSAL WAS 

INVOLUNTARY OR WITH PREJUDICE, IT DID NOT

PRECLUDE THEIR SECOND SUIT

The Paperas challenge the District Court’s holding that 

claim preclusion bars their second suit. Although some dismissals preclude relitigating claims, the Paperas argue that theirs 

did not. To assess their argument, we must figure out what kind 

of dismissal the District Court entered. Dismissals can be either 

voluntary or involuntary. Fed R. Civ. P. 41(a), (b). The kind of 

dismissal bears on whether it was with prejudice. And the prejudicial effect of a dismissal guides our claim-preclusion analysis.

A. The voluntariness of a dismissal bears on whether it 

is with prejudice

To assess whether a dismissal was with prejudice, we must 

first ask whether it was voluntary or involuntary. The default 

rule is different for each type.

For voluntary dismissals, the default rule is that a plaintiff’s 

first dismissal is without prejudice. Fed. R. Civ. P. 41(a). To 

overcome that default rule, the plaintiff’s notice of dismissal or 

the district court’s order entering the voluntary dismissal must 

“state[] otherwise.” Id.

Case: 18-3060 Document: 45 Page: 5 Date Filed: 01/22/2020
6

For involuntary dismissals, the default rule is the opposite. 

“Unless the dismissal order states otherwise,” it “operates as 

an adjudication on the merits” and so (as discussed below) is 

with prejudice. Fed. R. Civ. P. 41(b). The default rule applies 

to, among other things, dismissals for failure to prosecute or to 

comply with a court order or rules. Id. The rule does carve out 

exceptions for dismissals based on venue, jurisdiction, or failure to join indispensable parties. Id. And courts may carve out

other exceptions to this default rule. Semtek Int’l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 503 (2001). Setting those 

aside, involuntary dismissals are presumptively with prejudice.

B. For a dismissal to preclude claims, it must be with 

prejudice

Only a prior dismissal with prejudice (whether voluntary or 

involuntary) precludes later relitigating the dismissed claims.

Claim preclusion is traditionally said to require a “judgment on 

the merits.” United States v. Athlone Indus., Inc., 746 F.2d 977, 

983 (3d Cir. 1984). But that term of art is confusing because it 

does not require an actual verdict or summary judgment; a 

sanction for failure to follow court rules, for instance, can qualify too. See Fed. R. Civ. P. 41(b); Semtek, 531 U.S. at 502. The 

on-the-merits requirement is better understood in terms of its 

functional equivalent: whether a dismissal is with prejudice. 

Semtek, 531 U.S. at 505–06; 9 Charles Alan Wright & Arthur 

R. Miller, Federal Practice and Procedure §2373, at 739–43 

& n.4 (3d ed. 2008) (“‘[W]ith prejudice” is an acceptable form 

of shorthand for ‘an adjudication upon the merits.’”).

A dismissal with prejudice “operates as an adjudication on 

the merits,” so it ordinarily precludes future claims. Landon v. 

Case: 18-3060 Document: 45 Page: 6 Date Filed: 01/22/2020
7

Hunt, 977 F.2d 829, 832–33 (3d Cir. 1992); accord Lawlor v. 

Nat’l Screen Serv. Corp., 349 U.S. 322, 327 (1955). Conversely, a “‘[d]ismissal ... without prejudice’ is a dismissal that 

does not ‘operat[e] as an adjudication upon the merits,’ Rule 

41(a)(1), and thus does not have a [claim-preclusive] effect.” 

Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 396 (1990); 

see Semtek, 531 U.S. at 505.

C. We construe ambiguities in dismissals against claim 

preclusion

When we are uncertain what kind of dismissal the district 

court entered, we construe ambiguities against claim preclusion. We do so because a dismissal with prejudice “is a severe 

and disfavored remedy” that is “only appropriate in limited circumstances.” Alvin v. Suzuki, 227 F.3d 107, 122 (3d Cir. 2000);

Emerson v. Thiel Coll., 296 F.3d 184, 190 (3d Cir. 2002). And 

the party asserting claim preclusion bears the burden of proving all the elements. Taylor v. Sturgell, 553 U.S. 880, 907 

(2008). That includes proving that a dismissal was with prejudice and so can preclude claims.

To implement that burden of proof, we adopt two clearstatement rules: For purposes of claim preclusion, we will construe unclear dismissal orders as voluntary rather than involuntary. And we will construe unclear first voluntary dismissals as 

without prejudice, so they will not preclude relitigating the 

same claims. Only a clear and explicit statement will suffice to 

make a dismissal involuntary, or voluntary with prejudice.

Our sister circuits apply similar clear-statement rules. Take 

the Fourth Circuit’s decision in Choice Hotels International, 

Case: 18-3060 Document: 45 Page: 7 Date Filed: 01/22/2020
8

Incorporated v. Goodwin & Boone, 11 F.3d 469 (4th Cir. 

1993). There, the parties had reached a “tentative settlement” 

and sought a voluntary dismissal. Id. at 470. So the district 

court conditionally dismissed “without prejudice,” requiring 

the parties “to move for good cause within 30 days to reopen 

this action if settlement is not consummated.” Id. The plaintiff 

never submitted a settlement agreement but refiled the same

suit after the thirty days expired. Id.

The Fourth Circuit treated the first order as a dismissal 

without prejudice because “nowhere did the [first] dismissal 

order state explicitly that the dismissal would be prejudicial if 

its condition was not satisfied.” Id. at 473. It adopted a clearstatement rule: Unless a district court “explicit[ly] and 

clear[ly]” states that “its voluntary dismissal is prejudicial if its 

stated conditions are not met,” courts must treat its dismissal 

as without prejudice. Id. at 471. That clear-statement rule, it 

reasoned, “promotes our strong preference that cases be decided on their merits.” Id. at 472. It also gives plaintiffs fair 

warning before inflicting the “drastic consequence” of cutting 

off litigation. Id.

The Fourth Circuit built its clear-statement rule on the decisions of several other circuits. See, e.g., Plumberman, Inc. v. 

Urban Sys. Dev. Corp., 605 F.2d 161, 162 (5th Cir. 1979) (per 

curiam) (“Because the [earlier dismissal] order did not otherwise specify, the dismissal is without prejudice. Consequently 

it can have no res judicata effect.”); see also McKenzie v. Davenport-Harris Funeral Home, 834 F.2d 930, 934 (11th Cir. 

1987) (holding that a voluntary stipulation of dismissal “must 

Case: 18-3060 Document: 45 Page: 8 Date Filed: 01/22/2020
9

be considered without prejudice because it was not expressly 

provided for in the document”). We now join these courts.

D. The District Court’s order did not explicitly state 

that its voluntary dismissal was or would become a 

dismissal with prejudice

The clear-statement rules resolve this case. The Paperas 

told the District Court that the parties had reached a settlement 

and asked for an order of dismissal. At the parties’ request, the 

Court entered the May 2016 Order. So this was a first voluntary 

dismissal under Rule 41(a). And the Court did not make clear 

that the dismissal of the first suit was involuntary or with prejudice. True, the Court may have meant to dismiss the suit involuntarily with prejudice for failure to prosecute or comply 

with its orders. After all, the Paperas did not present a settlement agreement within the agreed-upon sixty days. But the Order here did not say that its dismissal was involuntary. Nor did 

the motion or order specify that any voluntary dismissal would 

become one with prejudice. 

Nothing else in the record clearly or explicitly specifies that 

this dismissal was either involuntary or with prejudice. The 

Court did not, for instance, file a separate order dismissing for 

failure to prosecute or for another ground listed in Rule 41(b). 

Nor did it involuntarily dismiss during the conference call. It 

asserted simply that “it no longer had jurisdiction over the 

case” because of the May 2016 Order. Papera, 2018 WL 

4051748, at *1. Nor did it do so by closing the case. Administrative closure merely clears a docket. But it is not a dismissal

because courts retain jurisdiction and can reopen 

Case: 18-3060 Document: 45 Page: 9 Date Filed: 01/22/2020
10

administratively closed cases. See, e.g., Papotto v. Hartford 

Life & Accident Ins. Co., 731 F.3d 265, 275 (3d Cir. 2013). 

In sum, a silent or unclear record will not do. The Paperas, 

like the plaintiff in Choice Hotels, failed to move to reopen 

during the specified period for doing so. But nothing in the record warned them that the resulting dismissal would preclude 

relitigating their claims. And because this was their first dismissal, Rule 41(a) tells us that it was without prejudice. Thus, 

it does not preclude their second suit.

* * * * *

Because the Order dismissing the first suit contained no 

clear, explicit statement that it was an involuntary dismissal or 

a dismissal with prejudice, we read it as a voluntary dismissal 

without prejudice. So it could not preclude this suit. We will 

thus vacate and remand for further proceedings.

Case: 18-3060 Document: 45 Page: 10 Date Filed: 01/22/2020