Court Opinion

ID: 3020746
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:23:26.645248+00
Date Added: 2024-06-11T15:03:31.052768
License: Public Domain

United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT

      ___________

      No. 95-3682
      ___________

James M. Kulinski,                      *
                                        *
            Appellant,                  *
                                        *
      v.                                *
                                        *
Medtronic Bio-Medicus, Inc.,            *
                                        *
            Appellee.                   *

      ___________
                                            Appeal from the United States
      No. 95-3803                           District Court for the District
      ___________                           of Minnesota.

James M. Kulinski,                     *
                                       *
            Appellee,                  *
                                       *
      v.                               *
                                       *
Medtronic Bio-Medicus, Inc.,           *
                                       *
            Appellant.                 *
                                  ___________

                               Submitted: April 17, 1998

                               Filed: May 8, 1998
                                   ___________
Before BRIGHT and MURPHY, Circuit Judges.*

BRIGHT, Circuit Judge.

        We return to this case following the answer by the Minnesota Supreme Court of
a certified question of law relating to Minnesota savings statute, Minn. Stat. § 541.18
(1996). Pursuant to Minn. Stat. § 480.062 (1990), this court certified the following
question of law to the Minnesota Supreme Court on May 2, 1997:

       [C]an a plaintiff in the particular circumstances of this case, whose
       favorable verdict and judgment was vacated on appeal for lack of subject
       matter jurisdiction, bring the same claim under a different legal theory and
       be saved by the operation of Minnesota's savings statute, § 541.18 (1990),
       from the bar of the statute of limitations under Minn. Stat. § 541.07(5)
       (1990)?

Kulinski v. Medtronic Bio-Medicus, Inc., 112 F.3d 368, 372 (8th Cir. 1997).

     In an opinion authored by Justice Tomljanovich dated April 16, 1998, the
Minnesota Supreme Court (en banc) in case number C5-97-942, 1998 WL 175678,
answered the certified question in the affirmative.

       We express our sincere appreciation to the Minnesota Supreme Court for its
assistance in this case. The issue certified relates to a difficult issue of construction and
interpretation of a Minnesota statute, never previously considered by a Minnesota

  *
   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.
appellate court. It concerns a matter appropriate for resolution by the state supreme
court.

I. PRIOR PROCEEDINGS

     Our prior opinion stated the background for this case and the referral to the
Minnesota Supreme Court of a certified question. We reiterate that background here.

              James M. Kulinski brought this state law breach of contract action
      against Medtronic Bio-Medicus, Inc. (Medtronic). 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 reversed the dismissal of Kulinski’s
      claim but affirmed the denial of Medtronic’s cross-appeal. Kulinski v.
      Medtronic Bio-Medicus, Inc., 108 F.3d 904 (8th Cir. 1997). Medtronic
      then filed a petition for rehearing by this panel as well as a suggestion for
      rehearing en banc. We granted the petition for rehearing by the panel and
      vacated the panel’s original opinion, thereby rendering the request for a
      rehearing en banc moot.

            On rehearing by the panel we again agree with the district court’s
      conclusions that the Minnesota statute of limitations, Minn. Stat. §
      541.07(5)(1990), applies and again affirm the dismissal of Medtronic’s
      cross-appeal. However, we certify to the Minnesota Supreme Court,
      pursuant to Minn. Stat. § 480.061 (1996), the question of the district
      court’s rejection of the application of the savings statute, Minn. Stat. §
      541.18 (1990), to the facts of this case.

                                  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 that 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.

       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., 60 F.3d 830
(8th Cir. 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. 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.

Kulinski, 112 F.3d at 368-70.

      In this litigation, Kulinski presents 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 the
      claim is saved under Minn. Stat. § 541.18 (1990). In the alternative,
      Kulinski seeks equitable relief from the statute of limitations.

Id. at 371.

       Medtronic argues as an alternative ground for affirmance that Kulinski's claim
is precluded by res judicata. Id.

       We vacated this court's earlier opinion on this case reported at 108 F.3d 904 (8th
Cir. 1997) by granting a rehearing by the panel. On the rehearing, we determined in
our opinion that (1) the employees' severance payments were "wages" for purposes of
Minnesota's two-year statute of limitations applicable for recovery of wages and that
(2) plaintiff's claim was not barred by the doctrine of res judicata. As to the latter issue,
we affirmed the denial of the cross-appeal by Medtronic Bio-Medicus, Inc. Kulinski,
112 F.3d at 373. That opinion resolved those two issues.1

       In that opinion, we certified the savings statute issue to the Supreme Court of the
State of Minnesota. In our referral we said:

              "In the absence of controlling precedent in the decisions of the
       Minnesota Supreme Court which would enable this court to reach a sound
       decision without indulging in speculation or conjecture, we believe the
       better practice is to seek a definitive resolution of th[is] state law
       question[] by the Minnesota Supreme Court." Kaiser v. Memorial Blood
       Center of Minneapolis, Inc., 938 F.2d 90, 93-94 (8th Cir. 1991).
       Accordingly, we certify the following question to the Minnesota Supreme
       Court pursuant to Minn. Stat. § 480.061: can a plaintiff in the particular
       circumstances of this case, whose favorable verdict and judgment was
       vacated on appeal for lack of subject matter jurisdiction, bring the same
       claim under a different legal theory and be saved by the operation of
       Minnesota’s savings statute, § 541.18 (1990), from the bar of the statute
       of limitations under Minn. Stat. § 541.07(5)(1990)?

Kulinski, 112 F.3d at 372.

        As we have already observed, the Minnesota Supreme Court answered the
certified question in the affirmative. Kulinski v. Medtronic Bio-Medicus, Inc., No. C5-
97-942, 1998 WL 175678 (Minn. Apr. 16, 1998). The answer to the certified question
has now resolved all issues in this case.

   1
   Kulinski also asked for equitable relief. We do not reach that issue as it is now
moot.
       The Minnesota Supreme Court addressed two issues when considering the
certified question of whether Minnesota's savings statute saves Kulinski's breach of
contract action. Minnesota's savings statute provides:

      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 appeal, the plaintiff may begin a new action within one
      year after such reversal or arrest.

Minn. Stat. § 541.18. First, the Minnesota Supreme Court held "that a judgment for
the plaintiff, vacated on appeal for lack of subject-matter jurisdiction, is 'reversed'
within the meaning of section 541.18" because an alternative construction would defeat
the legislative purpose and "a vacated judgment has the same practical effect as
reversal." 1998 WL 175678 at *3. Second, the Minnesota Supreme Court decided that
the savings statute permits a different legal theory to be raised in a subsequent action
as long as the defendant received notice. 1998 WL 175678 at *4-5. The Minnesota
Supreme Court concluded that "Bio-Medicus received notice, within the limitations
period, of Kulinski's stance--i.e., the termination agreements bound Bio-Medicus to pay
severance benefits to Kulinski in the event of a takeover and termination of his
employment." 1998 WL 175678 at *5.

      For resolution of the Minnesota savings statute issue, we are bound to follow the
ruling of the Minnesota Supreme Court on the certified question. See Kaiser v.
Memorial Blood Center of Minneapolis, Inc., 977 F.2d 1280 (8th Cir. 1992).
Accordingly, we hold that Minn. Stat. § 541.18 saves Kulinski's breach of contract
action from the statute of limitations governing wage claims.
II. CONCLUSION

      For the foregoing reasons, we reverse the dismissal of Kulinski's contract action
and remand for further proceedings consistent with this opinion and the opinion of the
Minnesota Supreme Court. We affirm the district court's ruling rejecting Medtronic's
cross-appeal.

      A true copy.

             Attest:

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