Donald Stephens v. Leslie Jessup , 793 F.3d 941 ( 2015 )

United States Court of Appeals
For the Eighth Circuit
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No. 13-3123
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Donald Stephens,
lllllllllllllllllllll Plaintiff - Appellant,
v.
Leslie Jessup; Amtote International, Inc.,
lllllllllllllllllllll Defendants - Appellees.
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Appeal from United States District Court
for the Western District of Arkansas - Hot Springs
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Submitted: December 10, 2014
Filed: July 20, 2015
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Before WOLLMAN, COLLOTON, and BENTON, Circuit Judges.
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COLLOTON, Circuit Judge.
Donald Stephens went gambling at the Oaklawn Jockey Club in Hot Springs,
Arkansas, and wound up in a dispute with security personnel and a local police
officer, Leslie Jessup, who accused him of theft. Stephens later sued the officer and
Amtote International, Inc., alleging false imprisonment, conversion, defamation,
violation of his civil rights, and intentional infliction of emotional distress. The
district court dismissed the action against Amtote International for failure to state a
claim. We conclude that Stephens did not perfect an appeal of that order. The district
court separately dismissed the claims against Jessup, ruling that they were barred by
the doctrine of issue preclusion. We express no view on the merits of those claims,
but we conclude that they are not precluded by previous litigation, so we reverse and
remand for further proceedings.
I.
According to the complaint, Stephens visited the Oaklawn Jockey Club for a
night of gambling on February 6, 2010. After winning a sum of money playing slot
machines, Stephens cashed out his ticket and left the casino. He returned later that
evening and purchased another gaming ticket for use in the slot machines.
While playing on this ticket, he was approached by several uniformed casino
security personnel and Jessup, a uniformed Hot Springs police officer. Jessup and the
security personnel accused Stephens of stealing the cashed-out ticket from another
patron who had been playing the slot machine. They detained Stephens while casino
employees reviewed surveillance footage to determine whether the ticket was stolen.
The complaint next alleges that Jessup threatened to “arrest [Stephens] and take him
to jail immediately” if he did not return the money that he received from cashing in
the stolen ticket. Jessup recited Miranda warnings, escorted Stephens to his vehicle,
and retrieved the money won at the casino.
In November 2010, Stephens sued Oaklawn in the Circuit Court of Pulaski
County, Arkansas. That complaint alleged that Oaklawn, through its “agents,
servants, and employees . . . acting within the scope and course of their employment,”
committed false imprisonment, conversion, defamation, violation of civil rights, and
intentional infliction of emotional distress. The court granted summary judgment in
favor of Oaklawn on the civil rights claim, and the remaining claims proceeded to
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trial. A jury ultimately returned a verdict in favor of Oaklawn. Neither Jessup nor
Amtote International was a party to the state court action.
Stephens then filed suit against Jessup and Amtote International in February
2013, alleging the same five causes of action against these new defendants. Jessup
moved to dismiss the complaint, arguing that the claims were barred by the doctrine
of res judicata. Amtote International moved separately to dismiss pursuant to Federal
Rule of Civil Procedure 12(b)(6), arguing that Stephens failed to state a claim against
it. On July 29, 2013, the district court granted Amtote’s motion to dismiss for failure
to state a claim. In a separate order entered on July 30, the court granted Jessup’s
motion, holding that the doctrine of issue preclusion barred Stephens from proceeding
against Jessup. Stephens filed a notice of appeal and argues now that both orders were
flawed.
II.
Amtote International argues that we lack jurisdiction to review the July 29 order
granting its motion to dismiss, because Stephens’s notice of appeal identified only the
July 30 order dismissing the claims against Jessup. The argument is well taken. To
vest this court with jurisdiction, an appellant must comply with the requirements of
Federal Rule of Appellate Procedure 3 to “designate the judgment, order, or part
thereof being appealed.” Fed. R. App. P. 3(c)(1)(B); see Smith v. Barry, 502 U.S. 244,
248 (1992); Schell v. Bluebird Media, No. 14-1649, 2015 WL 3429443, at *3 (8th Cir.
May 29, 2015). Stephens did not designate for appeal the order dismissing his claim
against Amtote International.
Stephens’s notice states that he is appealing “from the (Order) entered in this
action on the 30th day of July, 2013.” Although we liberally construe notices of
appeal, we cannot waive the jurisdictional requirements of Rule 3, and “a notice which
manifests an appeal from a specific district court order or decision precludes an
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appellant from challenging an order or decision that he or she failed to identify in the
notice.” Parkhill v. Minn. Mut. Life Ins. Co., 286 F.3d 1051, 1058 (8th Cir. 2002).
The district court entered two separate orders on separate motions to dismiss, but the
notice of appeal states only that Stephens appeals the July 30 order dismissing claims
against Jessup. We therefore conclude that we lack jurisdiction to review the district
court’s July 29 order granting Amtote International’s motion.
III.
Stephens contends that the district court erred by concluding that his claims
against Jessup are precluded by the 2010 judgment in Arkansas state court. Under the
Full Faith and Credit Act, 28 U.S.C. § 1738, federal courts must “give the same
preclusive effect to state court judgments that those judgments would be given in the
courts of the State from which the judgments emerged.” Kremer v. Chem. Constr.
Corp., 456 U.S. 461, 466 (1982). We review the district court’s decision de novo.
Edwards v. City of Jonesboro, 645 F.3d 1014, 1019 (8th Cir. 2011).
Arkansas preclusion law “has two facets, one being issue preclusion and the
other claim preclusion.” Huffman v. Alderson, 983 S.W.2d 899, 901 (Ark. 1998). The
district court concluded that issue preclusion barred Stephens’s claims against Jessup.
In Arkansas, issue preclusion requires the presence of four elements: “(1) the issue
sought to be precluded must be the same as that involved in the prior litigation; (2) the
issue must have been actually litigated; (3) the issue must have been determined by
a final and valid judgment; and (4) the issue must have been essential to the
judgment.” Beaver v. John Q. Hammons Hotels, L.P., 138 S.W.3d 664, 666 (Ark.
2003). Issue preclusion “may be asserted by a stranger to the first judgment, but the
party against whom it is asserted . . . must have had a full and fair opportunity to
litigate the issue in that first proceeding.” Craven v. Fulton Sanitation Serv., Inc., 206
S.W.3d 842, 844 (Ark. 2005).
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The district court dismissed the claims against Jessup because it thought “the
issues regarding Jessup’s conduct have already been decided in the 2010 lawsuit in
Jessup’s favor.” We respectfully disagree, because the record does not show
conclusively that the issues raised in the present action were actually litigated and
determined in the 2010 case. The 2010 lawsuit alleged that Oaklawn was liable for
the conduct of its agents and employees, including Jessup, under a respondeat
superior theory. The claims were resolved in favor of Oaklawn, but we do not know
why. Neither the order granting summary judgment on the civil rights claim, nor the
general jury verdict on the remaining claims, explains the basis for decision.
There are at least two possibilities. One is that the court and jury found
insufficient evidence that Jessup committed a tort or civil rights violation, so that
Oaklawn was not liable under the doctrine of respondeat superior. But another is that
Jessup was acting outside the scope of his agency or employment with Oaklawn, such
that Oaklawn was not liable for any tort committed by Jessup. Under the second
possibility, the issue of Jessup’s personal liability to Stephens for the alleged torts has
not been actually litigated and determined. Because the record does not establish that
the issues raised in this action were actually litigated in 2010, the doctrine of issue
preclusion does not justify dismissal of the claims against Jessup.
Jessup argues that we should affirm on an alternative ground that claim
preclusion bars this action, but we conclude that this doctrine also fails to support
dismissal. Claim preclusion in Arkansas bars a claim in a second suit when five
elements are satisfied:
(1) the first suit resulted in a final judgment on the merits; (2) the first
suit was based upon proper jurisdiction; (3) the first suit was fully
contested in good faith; (4) both suits involve the same claim or cause of
action; and (5) both suits involve the same parties or their privies.
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Ark. Office of Child Support Enf’t v. Williams, 995 S.W.2d 338, 339 (Ark. 1999). The
fifth element is lacking here. Oaklawn and Jessup are not the same party, and they are
not “privies” under the circumstances of this case.
Claim preclusion is inapplicable for largely the same reasons that issue
preclusion does not bar the action. Under Arkansas law, “[p]rivity exists when two
parties are so identified with one another that they represent the same legal right.”
Crockett v. C.A.G. Invs., Inc., 381 S.W.3d 793, 799 (Ark. 2011). In the principal-agent
context, the Arkansas Supreme Court “has all but done away with the privity
requirement, choosing instead to focus on whether or not the plaintiff is attempting
to relitigate an issue that has already been decided.” Jayel Corp. v. Cochran, 234
S.W.3d 278, 282 (Ark. 2006).
Whether claim preclusion applies turns on what was established in the first
action about the relationship between Jessup and Oaklawn. If it had been conceded
in the 2010 action that Jessup acted within the scope of his employment or agency
with Oaklawn, then the only issue in the case would have been Jessup’s negligence,
and Stephens could not relitigate the same thing in a second action. Davis v.
Perryman, 286 S.W.2d 844, 847-48 (Ark. 1956). But if there was no such concession,
then claim preclusion does not apply, because it cannot “be known with certainty that
the earlier decision against the plaintiff was based on the issue of negligence.” Frisby
v. Hurley, 364 S.W.2d 801, 802 (Ark. 1963). The first decision might have turned on
whether Jessup acted outside the scope of his agency or employment.
On this record, we cannot say that Stephens is trying to relitigate an issue that
was previously decided or that Jessup and Oaklawn represent the same legal right.
Stephens alleged in the 2010 case that Jessup acted “within the scope and course of
[his] employment,” but Oaklawn denied this allegation in its answer, and the record
does not show that Oaklawn conceded this point. The decisions of the court and jury
do not establish that the allegation was proved. In the 2013 complaint, Stephens did
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not even allege that Jessup acted within the scope of his agency or employment with
Oaklawn. Accordingly, without a concession in both cases that Jessup was acting
within the scope of his agency or employment during the events in question, there is
not a substantial identity of parties, and the doctrine of claim preclusion does not bar
Stephens’s action against Jessup. See Frisby, 364 S.W.2d at 802.
For the foregoing reasons, district court’s order dismissing Stephens’s claims
against Jessup is reversed, and the case is remanded for further proceedings.
Stephens’s appeal of the order dismissing claims against Amtote International is
dismissed for lack of jurisdiction.
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