Judge Magill, who was originally on the panel hearing this

*

appeal, recused himself after oral argument. Because a quorum of

the court exists and the two remaining judges agree on the outcome,

a third judge is unnecessary for a determination of this appeal.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 95-3682

___________

James M. Kulinski, *

*

Appellant, *

*

v. *

*

Medtronic Bio-Medicus, Inc., *

*

Appellee. *

___________

Appeal and Cross-Appeal from the

United States District Court

No. 95-3803 for the District of Minnesota.

___________

James M. Kulinski, *

*

Appellee, *

*

v. *

*

Medtronic Bio-Medicus, Inc., *

*

Appellant. *

___________

 Submitted: October 23, 1996

 Filed: March 13, 1997

___________

Before BRIGHT and MURPHY, Circuit Judges.*

___________

BRIGHT, Circuit Judge.
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James M. Kulinski brought this state law breach of contract

action against Medtronic Bio-Medicus, Inc. The district court

dismissed Kulinski's action pursuant to Minnesota's statute of

limitations for wage claims, Minn. Stat. § 541.07(5)(1990).

Kulinski appealed and Medtronic filed a protective cross-appeal

arguing that Kulinski's claim was precluded by res judicata. We

reverse the dismissal of Kulinski's claim but affirm the denial of

Medtronic's cross-appeal.

BACKGROUND

Kulinski worked for Bio-Medicus, Inc. (Bio-Medicus) as its

national sales manager. In January 1990, Kulinski executed a

change-of-control termination agreement (CCTA), or "golden

parachute" agreement, with Bio-Medicus. This CCTA entitled

Kulinski to a lump sum payment as severance if his employment

terminated or was otherwise detrimentally affected as the result of

a hostile takeover of Bio-Medicus. In June 1990, Kulinski signed

a second CCTA which entitled him to severance benefits if his

employment terminated or was detrimentally affected as the result

of a friendly merger. 

In September 1990, Bio-Medicus merged with Medtronic, Inc. to

form Medtronic Bio-Medicus, Inc. (Medtronic). Kulinski refused the

merged entity's offer of a two-year position at a reduced salary.

Kulinski resigned and notified Bio-Medicus and Medtronic, Inc. that

he experienced a "change of control termination" under the second

CCTA. Bio-Medicus rejected Kulinski's request for his lump sum

severance payment.
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Kulinski brought his first action against Medtronic on

February 26, 1991, asserting a claim under the Employee Retirement

Income Security Act (ERISA), 29 U.S.C. §§ 1001-1461 (1988 & Supp.

III 1991), for breach of the CCTA. Both parties and the district

court agreed that federal question jurisdiction existed under

ERISA. Kulinski did not bring any pendant state law claims at this

time. After a bench trial, the district court awarded Kulinski

$254,566 in severance pay, in addition to attorney's fees, costs,

and prejudgment interest. 

Medtronic appealed without challenging the application of

ERISA. This court held, sua sponte, that no ERISA plan existed

and, therefore, the district court lacked subject matter

jurisdiction. Kulinski v. Medtronic Bio-Medicus, Inc., 21 F.3d

254, 258 (8th Cir. 1994). We vacated the judgment for Kulinski and

remanded the case with instructions to dismiss for lack of subject

matter jurisdiction. Id. Kulinski then moved to amend his ERISA

complaint to allege a state law breach of contract claim under

diversity jurisdiction. The district court denied Kulinski's

motion and dismissed the case with prejudice. 

Kulinski appealed that decision on July 18, 1994. This court

upheld the district court's decision to dismiss Kulinski's ERISA

action with prejudice. Kulinski v. Medtronic Bio-Medicus, Inc.,

No. 94-2829, 1995 WL 413319, at *1 (8th Cir. July 14, 1995) (per

curiam) (unpublished).

Before we reviewed that appeal, however, Kulinski filed a new

action against Medtronic in federal district court based on

diversity jurisdiction. Kulinski raised the state law breach of

contract claim that the district court previously dismissed by

rejecting Kulinski's motion to amend his first (ERISA) action.

Medtronic moved to dismiss this second action pursuant to Fed. R.
-5-

Civ. P. 12(b)(6) on the grounds of res judicata and the statute of

limitations. The district court held Medtronic's motion under

advisement pending Kulinski's appeal.

After Kulinski lost his appeal, the district court granted

Medtronic's motion to dismiss Kulinski's state law action as barred

by Minnesota's statute of limitations for wage claims, Minn. Stat.

§ 541.07(5). The court, however, rejected Medtronic's argument

that res judicata precluded Kulinski's action. These appeals

followed.

DISCUSSION

Kulinski raises three issues on appeal. Kulinski first argues

that his claim is not barred by the statute of limitations because

he is not bringing a claim for “wages” for purposes of Minn. Stat.

§ 541.07(5). Kulinski also argues that, even if the statute

applies, his claim is not subject to the statute of limitations

because it is saved under Minn. Stat. § 541.18 (1990). Finally,

Kulinski seeks equitable relief from the statute of limitations.

In addition to contesting Kulinski's appeal, Medtronic argues that

Kulinski's claim is precluded by res judicata. We review the

district court's dismissal of Kulinski's complaint de novo, Carney

v. Houston, 33 F.3d 893, 894 (8th Cir. 1994), and presume all of

Kulinski's factual allegations as true. Miree v. DeKalb County,

Georgia, 433 U.S. 25, 27 n.2 (1977).

I.

Section 541.07(5) provides that an action shall be commenced

within two years if it is:
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For the recovery of wages or overtime or damages, fees or

penalties accruing under any federal or state law

respecting the payment of wages or overtime or damages,

fees or penalties except, that if the employer fails to

submit payroll records by a specified date upon request

of the department of labor and industry or if the

nonpayment is willful and not the result of mistake or

inadvertence, the limitation is three years. (The term

"wages" means all remuneration for services or

employment, including commissions and bonuses and the

cash value of all remuneration in any medium other than

cash, where the relationship of master and servant exists

. . . )[.]

Minn. Stat. § 541.07(5).

It is undisputed that the time allotted in § 541.07(5) expired

before Kulinski filed this diversity action. Nearly four years

passed between Medtronic's alleged breach of contract in 1990 and

the filing of Kulinski's second action in 1994. Kulinski, however,

argues that § 541.07(5) is not applicable because he does not bring

a claim for "wages" within the meaning of that section. Instead,

Kulinski argues that his action is covered by Minnesota's six-year

statute of limitations for actions based "[u]pon a contract or

other obligation, express or implied, as to which no other

limitation is expressly prescribed . . . ." Minn. Stat. § 541.05,

subd. 1(1) (1990). We disagree.

Although it appears that no Minnesota court has specifically

addressed whether wages under § 541.07(5) include severance

benefits, Minnesota courts consistently hold that "all damages

arising out of the employment relationship are subject to [§

541.07(5)]." Stowman v. Carlson Companies, Inc., 430 N.W.2d 490,

493 (Minn. Ct. App. 1988) (applying Portlance v. Golden Valley

State Bank, 405 N.W.2d 240, 243 (Minn. 1987)); see also Levin v.

C.O.M.B. Co., 441 N.W.2d 801, 804 (Minn. 1989) (unpaid commissions

due pursuant to an employment contract); Portlance, 405 N.W.2d at
 Kulinski proposes a very different reading of Minnesota case

law. He cites McDaniel v. United Hardware Distrib. Co., 469 N.W.2d

84 (Minn. 1991), for the proposition that the two-year statute of

limitations does not apply unless the claim is either for hourly

pay or for wages that would have been earned had the employee not

been wrongfully terminated. That action rested on rights created

by statute and is, therefore, distinguishable.

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243 (wrongful discharge based on an oral contract of employment

allegedly modified by an employees' manual); Worwa v. Solz Enters.,

Inc., 238 N.W.2d 628, 631 (Minn. 1976) (contractual wage claims);

Roaderick v. Lull Eng'g Co., 208 N.W.2d 761, 762-63 (Minn. 1973)

(commission or bonus payments); Kohout v. Shakopee Foundry Co., 162

N.W.2d 237, 239-40 (Minn. 1968) (accrued but unpaid vacation pay);

Kletschka v. Abbott-Northwestern Hosp., Inc., 417 N.W.2d 752, 755

(Minn. Ct. App. 1988) (salary increases and "adjustment of all

fringe benefits"); cf. Adamson v. Armco, Inc., 44 F.3d 650, 652-53

(8th Cir.) (construing Stowman to conclude that Minnesota courts

construe § 541.07(5) broadly), cert. denied, 116 S. Ct. 85 (1995).

The Minnesota Supreme Court has also explicitly recognized the

"broad definition of wages stated in [§ 541.07(5)] . . . ."

Roaderick, 208 N.W.2d at 763.

In light of the consistently broad construction given to

§ 541.07(5), we affirm the district court in considering Kulinski’s

claim as one within the general concept of wages. The district

2

court did not err in applying the two-year limitation under §

541.07(5).

II.

Kulinski argues that even if the statute of limitations

applies, his claim is "saved" by Minnesota's savings statute:
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Except where the uniform commercial code otherwise

prescribes, if judgment be recovered by plaintiff in an

action begun within the prescribed period of limitation

and such judgment be afterward arrested or reversed on

error or appeal, the plaintiff may begin a new action

within one year after such reversal or arrest.

Minn. Stat. § 541.18 (1990). This statute, virtually unchanged

since its enactment in 1851, is rarely utilized and is not

interpreted by any appellate court. Furthermore, no legislative

history is available. 

We start, of course, with the plain language of the statute.

Gale v. Commissioner of Taxation, 37 N.W.2d 711, 714-15 (Minn.

1949). Indeed, simply because the statute is quite old does not

release us from our obligation to give the statute its plain

meaning. See, e.g., I.N.S. v. Phinpathya, 464 U.S. 190, 191-92

(1984) (holding that thirty-two-year-old statute must still be

given its plain meaning); see also Minn. Stat. § 645.16 ("Every law

shall be construed, if possible, to give effect to all its

provisions. When the words of a law in their application to an

existing situation are clear and free from all ambiguity, the

letter of the law shall not be disregarded under the pretext of

pursuing the spirit."). Kulinski meets the plainly worded

requirements of Minn. Stat. § 541.18. First, he filed his original

complaint five months after the alleged breach of contract and

within the statute of limitation. Second, Kulinski prevailed at

trial and was awarded over $250,000 in damages. Third, this court

reversed that judgment, not on the merits, but for lack of subject

matter jurisdiction. Fourth, Kulinski began this action based on

diversity jurisdiction within one year of our reversal. 

The district court, however, held the savings statute was

"inapplicable to the facts of this case as Kulinski is not bringing
 Indeed, the only legal issue present in Kulinski's first

3

(ERISA) action which need not be examined in Kulinski's second

action is whether the CCTA constituted an employee welfare benefit

plan under ERISA.

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a new action based on the same claim as had been previously

reversed, rather he is asserting a new claim." Dist. Ct. Order at

8. We disagree. 

A ‘cause of action’ is a situation or state of facts

which entitles a party to sustain an action and gives him

the right to seek judicial interference in his behalf.

Under the Federal Rules of Civil Procedure, the word

‘claim’ denotes the same thing, i.e. ‘the aggregate of

operative facts which gives rise to a right enforceable

in the courts.’ 

Rhodes v. Jones, 351 F.2d 884, 886-87 (8th Cir. 1965) (quoting Dery

v. Wyer, 265 F.2d 804, 807 (2d Cir. 1959)). Here, Kulinski's claim

that Medtronic breached the CCTA agreement is the same in both

actions. Thus, both actions share identical operative documents,

witnesses, measure of recovery and essentially the same legal

issues. The only distinction is that Kulinski now asserts a legal 3

theory, state law breach of contract under diversity jurisdiction,

that is different from his ERISA theory. In fact, Kulinski is

bringing the same claim. 

Significantly, Kulinski did not deliberately or carelessly

withhold the state law cause of action as an alternative theory in

his original pleading. ERISA is an "enormously complex and

detailed statute", Mertens v. Hewitt Assoc., 508 U.S. 248, 262

(1993) and "contains a preemption provision that applies to state

common law-based claims . . . ." Bannister v. Sorenson, 1996 WL

731897, at *2 (8th Cir. (Neb.)). This preemptive force explains

Kulinski's decision to proceed without alternative state law

theories. Indeed, both parties and the district court initially
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believed the CCTA was an ERISA plan and Medtronic's first appeal

did not even contest jurisdiction under ERISA. 

We refrain from interpreting the statute to permit a plaintiff

to bring a different claim on a successive appeal because that

issue is not before us. Rather, our holding is narrow. We believe

the statute allows a prevailing plaintiff, like Kulinski, to bring

a renewed action based on the same claim that he originally sought

relief if, through no fault of his own, a jurisdictional error

results in the reversal of his judgment on appeal. Accordingly,

Kulinski's second action, based on diversity jurisdiction, is

covered by the savings statute and, therefore, is not time-barred.

III.

Because we conclude that the savings statute applies to

Kulinski's claim, we decline to reach his request for equitable

relief. 

IV.

Medtronic raises a cross-appeal asserting that, even if

Kulinski's claim survives the statute of limitations, his claim is

precluded by res judicata. Claim preclusion requires three

elements: (1) identical parties in the lawsuits; (2) identical

claims or causes of action; and (3) a final judgment on the merits

in the prior action. Lane v. Peterson, 899 F.2d 737, 741 (8th Cir.

1990). In this case, the parties and claims are identical in both

suits. The only issue, then, is whether the district court

rendered a final judgment on the merits in the original action.

The district court held that the dismissal of Kulinski's first

complaint under ERISA for lack of jurisdiction was not an
 Medtronic's attempt to persuade us to ignore our precedent is 4

unconvincing. Medtronic cites to two cases for support. Kale v.

Combined Ins. Co. of America, 924 F.2d 1161 (1st Cir. 1991); Shaver

v. F.W. Woolworth Co., 840 F.2d 1361, 1367 n.2 (7th Cir. 1988).

These cases differ significantly from the case at bar because in

both Kale and Shaver the original cause of action was dismissed on

the merits and with prejudice. Here, of course, Kulinski's initial

claim was dismissed for lack of subject matter jurisdiction and was

not on the merits. Johnson v. Boyd-Richardson Co., 650 F.2d 147,

148 (8th Cir. 1981) ("[W]hen a dismissal is for ‘lack of

jurisdiction,’ the effect is not an adjudication on the merits, and

therefore the res judicata bar does not arise."). 

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adjudication on the merits of that claim and, therefore, was not a

final judgment. 

Medtronic first argues that res judicata requires Kulinski to

plead all bases for jurisdiction in his original pleading. This

argument is inconsistent with our precedent. In McCarney v. Ford

Motor Co., 657 F.2d 230 (8th Cir. 1981), we held that a dismissal

based on subject matter jurisdiction:

should preclude relitigation of the same [jurisdiction]

issue but not a second suit on the same claim even if

arising out of the identical set of facts. . . . [W]here

the second suit presents new theories of relief,

admittedly based upon the same operative facts as alleged

in the first action, it is not precluded because the

first decision was not on the merits of the substantive

claim. 

Id. at 233-34 (citations omitted); cf. Oglala Sioux Tribe v.

Homestake Mining Co., 722 F.2d 1407, 1411 (8th Cir. 1984) (holding

second action barred by res judicata because plaintiff "assert[ed]

identical claims and jurisdictional grounds" as the first action).

Kulinski based his first action on federal ERISA law and his second

action on state contract law. Thus, the dismissal of Kulinski's

first action precludes another ERISA claim, but not the same claim

under a different theory and jurisdictional basis.4
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Medtronic next argues that a denial of a motion for leave to

file an amended complaint has preclusive effect as to claims in the

amended complaint. The procedural history of all three cases cited

by Medtronic, however, included an adjudication of the first

complaint on the merits. See, e.g., King v. Hoover Group, Inc.,

958 F.2d 219, 221 (8th Cir. 1992) (original complaint dismissed on

summary judgment); Nagle v. Lee, 807 F.2d 435, 443 (5th Cir. 1987)

(original complaint dismissed for failure to prosecute); Carter v.

Money Tree Co., 532 F.2d 113, 114 (8th Cir. 1976) (original claim

dismissed for failure to state a claim). Kulinski's first

complaint, on the other hand, was dismissed only for lack of

subject matter jurisdiction. We decline to contort the district

court’s denial of Kulinski's proposed amended complaint into a

denial on the merits. 

Finally, Medtronic argues that the district court's dismissal

"with prejudice" operates as an adjudication on the merits and,

therefore, precludes subsequent actions. We disagree. In

McCarney, we held the plaintiff's second suit was not barred by the

dismissal of his first suit despite its label "with prejudice"

because it did not reach the merits. 657 F.2d at 234. 

CONCLUSION

For the foregoing reasons, we reverse the dismissal of

Kulinski’s contract action and remand for proceedings consistent

with this opinion. We affirm the district court’s ruling of

Medtronic’s cross-appeal.
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A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.