JIM GUNTER, Justice.
Appellants appeal the grant of summary judgment in favor of Gary Green and Law Offices of Gary Green,
On October 4, 1999, appellants filed a Title VII action in the United States District Court for the Eastern District of Arkansas, alleging that they were subjected to acts of sexual harassment by two co-workers while employed at Kroger and that Kroger delayed any action in preventing the harassment until July 17, 1999, when the co-workers were fired. On March 21, 2000, Kroger's motion for summary judgment was granted based on appellants'
On July 17, 2000, after obtaining new counsel, appellants filed a complaint in the Pulaski County Circuit Court against their previous counsel, Diane Sexton and Kelli Cashion. The complaint alleged that Sexton and Cashion had assured appellants that there was no need to first file a charge with the EEOC before filing suit in federal court; that the legal advice given by their counsel was wrong; that counsel had been negligent; that because of counsel's negligence, they had been barred from refiling their lawsuit; and that they had suffered and would continue to suffer personal and economic injuries as a result of counsel's negligence. On December 8, 2000, appellants amended their complaint to add defendant Green. The amended complaint alleged that following the filing of the complaint in federal court, but prior to the dismissal of the complaint, Sexton had become an employee of Green, and that during that time, the complaint could have been amended to include causes of action under state law, such as the tort of outrage, a claim for negligent hiring and retention, and a claim of discrimination under the Arkansas Civil Rights Act. But, once the federal court dismissed the case, these claims became barred by the doctrine of collateral estoppel. Appellants alleged that failure to raise those claims was negligent and that Green was vicariously liable for the acts and omissions of Sexton.
On January 3, 2001, Green answered and argued that any negligence and resulting damages were proximately caused by Sexton and Cashion. Green also filed a cross-claim against Sexton and Cashion seeking judgment against them for any alleged professional negligence committed by Sexton that might be imputed to Green. Between December 2004 and February 2008, Green filed three motions for summary judgment. The latest motion was filed on February 15, 2008. In that motion, Green argued that they could not be held liable for failing to timely file a complaint with the EEOC because the time in which to file such a complaint expired prior to the time Sexton began working for Green. Green also argued that they did not, as a matter of law, breach the standard of care or cause any damage to Lindsey and Ellis by not amending the federal complaint or dismissing it prior to the entry of summary judgment. Green asserted that res judicata did not bar state law claims from being filed in state court, and it was the plaintiffs' own failure to refile their action in state court before the statute of limitations expired that caused their damage.
On March 19, 2008, appellants filed a response, arguing that Green was incorrect on the law; that the dismissal of the federal action for failure to obtain a right-to-sue letter was a decision on the merits for purposes of res judicata; and that they were thus barred from pursuing any state causes of action. Green replied that appellants' response was not timely and that they had failed to meet proof with proof to demonstrate the existence of a material issue of fact. Also, on July 16, 2008, Green filed a motion for costs, asserting that it had filed offers of judgment to each plaintiff that had been rejected and that it was entitled to costs in the amount of $5,955.51 under Ark. R. Civ. P. 68. Appellants responded to this motion by arguing that the offers of judgment were not made in accordance with Rule 68; that the offers were not bona fide offers; and that the costs claimed by Green were not authorized by statute.
On January 23, 2009, the court entered an order denying Green's motion for costs because the offers of judgment were not bona fide offers. On January 30, 2009, appellants filed a motion to nonsuit their claims against Sexton and Cashion without prejudice, which was granted on February 5, 2009. And on February 3, 2009, the court entered an order dismissing Green's cross-claim against Sexton and Cashion as moot.
The law is well settled that summary judgment is to be granted by a trial court only when it is clear that there are no genuine issues of material fact to be litigated, and the party is entitled to judgment as a matter of law. Jackson v. Blytheville Civ. Serv. Comm'n, 345 Ark. 56, 43 S.W.3d 748 (2001). The evidence is viewed most favorably for the person resisting the motion, and any doubts or inferences are resolved against the moving party. Id. But in a case where the parties agree on the facts, this court simply determines whether the appellee was entitled to judgment as a matter of law. Id.
The concept of res judicata has two facets, one being issue preclusion and the other claim preclusion. Carwell Elevator Co. v. Leathers, 352 Ark. 381, 101 S.W.3d 211 (2003). Under claim preclusion, a valid and final judgment rendered on the merits by a court of competent jurisdiction bars another action by the plaintiff or his privies against the defendant or his privies on the same claim. Id. Res judicata bars not only the relitigation of claims which were actually litigated in the first suit, but also those that could have been litigated. Id. Where a case is based on the same events as the subject matter of a previous lawsuit, res judicata will apply even if the subsequent lawsuit raises new legal issues and seeks additional remedies. Id. However, res judicata is only applicable when the party against whom the earlier decision is being asserted had a fair and full opportunity to litigate the issue in question. Cater v. Cater, 311 Ark. 627, 846 S.W.2d 173 (1993).
On appeal, appellants argue that Green was incorrect in its argument that the dismissal of the federal action was not a dismissal on the merits so as to trigger res judicata. In support, appellants cite Mills v. Convalescent Home, 872 F.2d 823 (8th Cir.1989), and Francis v. Francis, 343 Ark. 104, 31 S.W.3d 841 (2000). In Mills, the plaintiff was barred from pursuing a second federal complaint after the first federal complaint had been dismissed as untimely. The court stated that "disposition of a Title VII action as untimely filed is a decision on the merits for purposes of
Coleman's Serv. Ctr., Inc. v. Fed. Deposit Ins. Corp., 55 Ark.App. 275, 295, 935 S.W.2d 289, 300 (1996). Appellants assert that, under the above case law, the federal court clearly had jurisdiction of the Title VII claim as well as state-law causes of action under pendent jurisdiction, and because there were no state-law claims asserted and the federal suit was dismissed with prejudice, res judicata now bars the assertion of the state claims in state court. Appellants argue that Green can and should be held liable for its negligence in failing to assert or preserve those state-law claims.
Appellants also distinguish a case relied on by Green, Semtek Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 121 S.Ct. 1021, 149 L.Ed.2d 32 (2001). In Semtek, a defendant removed a California state-court suit to a California federal district court based on diversity of citizenship, and then successfully moved to dismiss the case "on the merits" as barred by California's statute of limitations. The plaintiff then brought suit in a Maryland Circuit Court, alleging the same causes of action, which were not time barred under Maryland's statute of limitations. That court dismissed the case on the ground of res judicata, and the dismissal was affirmed by the Maryland Court of Special Appeals. The United States Supreme Court held that because the claim-preclusive effect of a federal court's dismissal "upon the merits" of a diversity action on state statute-of-limitations grounds is governed by a federal rule, which in turn (in diversity cases) incorporates the claim-preclusion law that would be applied by state courts in the state in which the federal court sits, the Maryland Court of Special Appeals erred in holding that the California federal court's dismissal "upon the merits" necessarily precluded the Maryland state-court action. Appellants assert that Semtek's applicability is debatable, since it was a diversity case and the case at bar involves a federal question, and further, Semtek did nothing more than establish that the preclusive effect of a federal judgment is governed by the law of the state in which the district court sits. And, under Arkansas law, res judicata would bar any claims that could have been brought in federal court.
Finally, appellants contend that the case at bar is similar to Arkansas Louisiana
In response, Green argues that the circuit court correctly determined that res judicata did not bar appellants' state claims.
Green emphasizes that the issues in appellants' federal action were not "fully and fairly litigated" and that res judicata applies "only when the party against whom the earlier decision is being asserted had a fair and full opportunity to litigate the issue in question." Cater, 311 Ark. at 632, 846 S.W.2d at 176. Green also asserts that Semtek, supra, is squarely on point because in that case a federal claim was dismissed with prejudice, but the Supreme Court still held that it was not necessarily claim-preclusive as to state-law claims. Green also cites Zhang v. Department of Labor & Immigration, 331 F.3d 1117 (9th Cir.2003), for the proposition that a dismissal on statute-of-limitations grounds does not generally bar a subsequent action in a different forum when the limitations in the second forum is longer than the first and has not yet expired. In conclusion, Green reiterates that, because the state-law claims were not barred by res judicata, appellants could have filed the state-law claims within the applicable statute of limitations after they retained new counsel, so Green is not liable for any harm to appellants.
We agree that appellants' state-law claims were not barred by res judicata at the time they discharged Green. In Costello v. United States, 365 U.S. 265, 81 S.Ct. 534, 5 L.Ed.2d 551 (1961), the Supreme Court held that a dismissal for failure to satisfy a precondition was not a decision on the merits and did not bar a subsequent action on the same claim. The prerequisites for a suit under Title VII include a timely filed administrative charge and timely institution of the suit after receipt of a right-to-sue notice. Criales v. Am. Airlines, Inc., 105 F.3d 93 (2d Cir.1997). So, it follows that the federal court dismissal for failure to file with the EEOC was not a judgment "on the merits" that would operate to bar appellants' state law claims under res judicata. Appellants are correct that, usually, a dismissal with prejudice is as conclusive of the rights of the parties as if there had been an adverse judgment as to the plaintiff after a trial, but there are limitations to the doctrine of res judicata as recognized by our court of appeals:
Cox v. Keahey, 84 Ark.App. 121, 133 S.W.3d 430 (2003) (quoting Restatement (Second) of Judgments § 20(2) (1982)). In contrast, a judgment on the merits in federal court will operate under the doctrine of res judicata to bar claims against the same defendants in state court. See Nat'l Bank of Commerce v. The Dow Chem. Co., 338 Ark. 752, 1 S.W.3d 443 (1999); Howell v. Hodap, 221 Ariz. 543, 212 P.3d 881 (2009).
We also note with approval the similar case of Andujar v. National Property & Casualty Underwriters, 659 So.2d 1214 (1995), in which the District Court of Appeal of Florida, Fourth District, reversed a summary judgment that was granted based on a finding that adjudication of an employee's Title VII claim was res judicata
Id. at 1218. Thus, under the reasoning in Andujar, even if this court considered the federal order a decision "on the merits," appellants' state claims were not necessarily barred. We therefore affirm the circuit court's grant of summary judgment to Green.
On cross-appeal, Green contends that the circuit court erred in denying its motion for costs. However, we find that Green has failed to file an effective notice of appeal from the order denying costs. Whether an appellant has filed an effective notice of appeal is always an issue before the appellate court, and absent an effective notice of appeal, this court lacks jurisdiction to consider the appeal and must dismiss it. Bilyeu v. State, 342 Ark. 271, 27 S.W.3d 400 (2000).
Green's notice of cross-appeal, filed February 24, 2009, stated that Green was appealing the "Final Order entered in this case on January 20, 2009" and that the notice was timely. However, Green asserts on appeal that he is appealing the court's order denying its motion for costs, and that ruling is not contained in the January 20, 2009 order specified in Green's notice of appeal. The denial of costs was a completely separate order filed on January 23, 2009. Rule 3(e) of the Rules of Appellate Procedure provides that a notice of appeal shall, among other things, "designate the judgment, decree, order, or part thereof appealed from." Ark. R.App. P.-Civ. 3(e) (2008). A notice of appeal must therefore designate the judgment or order appealed from, and an order not mentioned in the notice of appeal is not properly before an appellate court. See Wright v. State, 359 Ark. 418, 198 S.W.3d 537 (2004) (citing Daniel v. State, 64 Ark.App. 98, 983 S.W.2d 146 (1998)).
Affirmed on direct appeal; cross-appeal dismissed.