Diminico v. Lehman Bros Inc

Opinion

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

______________

No. 95-20568 Summary Calendar ______________

NICK DIMINICO, Plaintiff-Appellant,

versus

LEHMAN BROTHERS, INC., formerly known as Shearson Lehman Brothers, Inc., Defendant-Appellee.

_________________________________________________________________

Appeal from the United States District Court for the Southern District of Texas (CA-H-95-1057) _________________________________________________________________

April 12, 1996

Before SMITH, BENAVIDES and DENNIS, Circuit Judges.

PER CURIAM*:

Plaintiff-Appellant Nick Diminico ("Diminico") appeals the

district court's order of dismissal in this case entered June 28,

1995. Although the court failed to enter a judgment separate from

the dismissal order as required by FED. R. CIV. P. 58, the record

makes clear that the district court intended to end the litigation

with this order. Therefore, we may exercise jurisdiction over the

appeal. See Whitaker v. City of Houston, Tex., 963 F.2d 831, 833-

34 (5th Cir. 1992). Finding the district court's dismissal in

error, we vacate and remand.

* Pursuant to Local Rule 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in Local Rule 47.5.4. I.

On June 30, 1994, Diminico filed his original complaint in the

district court alleging claims under the Employee Retirement Income

Security Act of 1974 ("ERISA") and claims under Texas law. The

district court dismissed Diminico's complaint without prejudice for

failure to serve the summons within 120 days of the filing of the

complaint. See FED. R. CIV. P. 4(j).

On February 14, 1995, Diminico filed in Texas state court

alleging the same claims. Defendant-Appellee Lehman Brothers, Inc.

("Lehman Brothers") removed the action to federal court and moved

to dismiss based on the running of the statute of limitations

applicable to Diminico's claims. The district court granted the

motion to dismiss, finding that the case was based upon the same

set of facts as the cause of action previously dismissed. The

court did not address Lehman Brothers' limitations defense.

II.

The district court's second dismissal now on appeal appears to

be based on the doctrine of res judicata and/or collateral

estoppel. We find that res judicata cannot be properly applied in

this case. The first dismissal was without prejudice, and was not

a judgment on the merits. In addition, Lehman Brothers was not

properly served in the first action and, thus, was not a proper

party. Therefore, because the was never a final judgment on the

merits and the parties are not identical in both suits, the

district court erred in dismissing Diminico's second cause of

action based on the doctrine of res judicata. See Nagle v. Lee,

2 807 F.2d 435, 440 (5th Cir. 1987). We also find collateral

estoppel inapplicable as the facts were not "fully and fairly

litigated" in the first action and the parties were not cast as

adversaries in the first action. See Matter of Greenway, 71 F.3d

1177 (5th Cir. 1996).

Lehman Brothers argues on appeal that dismissal was proper

because Diminico's claim for conversion is barred by the applicable

two-year statute of limitations. However, Diminico did not specify

in his complaint which section under ERISA applied to his cause of

action. The determination of the nature of Diminico's cause of

action and the applicable statute of limitations is a mixed

question of law and fact. Such a determination requires a close

examination of Diminico's pleadings to evaluate their true nature

and specification as to the pertinent ERISA section that he alleges

Lehman Brothers violated. As a court of review, we decline to make

such a factual determination in the first instance and remand to

the district court for further development and evaluation.

III.

For the reasons articulated above, the district court's

dismissal is VACATED, and we REMAND to the district court for

further development consistent with this opinion.