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Mason v. Telefunken Semiconductors Amer, 14-1962 (2015)

Court: Court of Appeals for the First Circuit Number: 14-1962 Visitors: 11
Filed: Jul. 29, 2015
Latest Update: Mar. 02, 2020
Summary:  Avery v. Hughes, 661 F.3d 690, 693 (1st Cir.TSA demurs.6 We note that Mason also relies upon the sworn statement of, the former Tejas president as evidence that Tejas terminated, Mason's employment within the meaning of the Agreement.court did not err in granting summary judgment on this claim.
          United States Court of Appeals
                      For the First Circuit

No. 14-1962

                         THOMAS R. MASON,

                       Plaintiff, Appellant,

                                v.

              TELEFUNKEN SEMICONDUCTORS AMERICA, LLC,

                       Defendant, Appellee.



          APPEAL FROM THE UNITED STATES DISTRICT COURT

                 FOR THE DISTRICT OF NEW HAMPSHIRE

         [Hon. Joseph N. Laplante, U.S. District Judge]



                              Before

                       Howard, Chief Judge,
                 Selya and Lynch, Circuit Judges.



     Kenneth J. Barnes, with whom Law Office of Kenneth J. Barnes,
Anne M. Rice, and Rice Law Office PLLC were on brief, for
appellant.
     Irvin D. Gordon, with whom Sulloway & Hollis, P.L.L.C. was on
brief, for appellee.



                           July 29, 2015
            SELYA, Circuit Judge.           This case involves a series of

shifting employment arrangements.             Plaintiff-appellant Thomas R.

Mason asserts that defendant-appellee TSI Semiconductors America,

LLC (TSA), formerly known as Telefunken Semiconductors America,

LLC, abridged his contractual rights with respect to no fewer than

three of these arrangements.          At the summary judgment stage, the

district court concluded that Mason had failed to make out a

genuine issue of material fact sufficient to sustain any of his

claims.     After careful consideration, we reverse in part, affirm

in part, and remand for further proceedings.

I.     BACKGROUND

            In    2009,    Mason   began    work   in   a    senior   engineering

position    for    Tejas   Silicon,   Inc.     (Tejas),       a   California-based

corporation with an office in New Hampshire.                 The terms of Mason's

employment were delineated in a written agreement (the Agreement)

that took effect on April 1, 2009. The Agreement contained a

section entitled "Consequences of Termination of Employment."

Part   of   this    section    permitted      Tejas     to    terminate   Mason's

employment without cause upon 60 days' written notice, in which

event Mason would be entitled to continued salary payments and

benefits for one year.        If, however, the termination was "due to




                                           - 2 -
the acquisition, merger, or buyout by another entity," then Mason's

severance pay and benefits would continue for two years.2

             The Agreement stipulated that Mason's employment was for

a fixed term (one year), which would renew automatically on each

anniversary of the Agreement's effective date unless either party

elected not to renew.         An election not to renew could be made by

providing written notice no fewer than 30 days prior to the

anniversary date.

             Mason's employment with Tejas continued uneventfully for

two years, and the Agreement renewed automatically on April 1,

2010 and April 1, 2011. The landscape changed, though, in December

of   2011     when    Mason     learned      of    an     impending   corporate

restructuring.3      As Mason understood it, Tejas would terminate his

employment     and   TSA    would    offer   him    new    employment.     Soon

thereafter, TSA wrote to Mason and offered him employment in his

then-current     position     at    his   then-current      salary,   beginning

January 1, 2012 (the Offer Letter).


     2 The Agreement entitled Mason, in certain circumstances, to
immediate vesting of stock options as part of a severance package.
Because this appeal is not concerned with the quantum of damages
(if any) to which Mason may be entitled, we make no further
reference to the stock option provisions.

     3 The parties dispute the nature of the corporate event that
ultimately transpired. TSA maintains that Tejas continues to exist
as a separate and independent entity; Mason maintains that Tejas
was merged into TSA.    Our disposition of this appeal does not
require us to resolve this dispute, and we shall refer to this
event neutrally as the "2011 reorganization."


                                          - 3 -
           Mason decided to accept employment with TSA and, in

December of 2011, signed four documents: a document entitled

"Amendment to Employment Agreement" (the Amendment); the Offer

Letter; a document entitled "Employment, Confidential Information

and Invention Assignment Agreement" (the New Agreement); and a

document   entitled    "Employee      Transfer    Agreement    and   General

Release" (the Release).       By its terms, the Amendment was to take

effect on January 1, 2012.       Mason, Tejas, and TSA all signed it,

thus memorializing their mutual intent to amend the Agreement.

           The Amendment went on to state that, "effective as of

January 1, 2012," each reference to Tejas in the Agreement would

be replaced by a reference to TSA; that Tejas would "transfer and

assign to [TSA] the Agreement and all of its rights, duties and

obligations thereunder"; and that TSA would assume those rights,

duties, and obligations.        It also provided that "the Agreement

shall   continue    under    [Mason's]   employment    relationship    with

[TSA]."

           The     Offer    Letter,   though,     provided    that   Mason's

employment with TSA would be "for no specified period of time" and

would be "an at-will employment relationship," under which either

Mason or TSA could "terminate the relationship at any time, for

any reason, with or without cause."             Apparently in response to

this language, Mason wrote (in the signature block of the Offer




                                       - 4 -
Letter) the words "As Amended (Attached)" and annexed a copy of

the Amendment.

          The New Agreement contained, in capital letters, Mason's

acknowledgment "that, except as set forth in any other written

agreement between me and the company, my employment with the

company constitutes 'at-will' employment."    Mason executed this

document without any qualification.

          To complete the picture, the Release provided that, in

exchange for $1000 and the offer of new employment by TSA, Mason

would "ABSOLUTELY AND IRREVOCABLY AND UNCONDITIONALLY" release TSA

from "any and all claims" against TSA or its "[r]elated [p]arties,"

including claims arising "as a result of [his] employment with and

separation from employment" as of December 31, 2011.   Here again,

Mason added a holographic coda, stating cryptically "EXCEPT AS

AMENDED IN 'AMENDMENT TO EMPLOYMENT AGREEMENT.'"

          In January of 2012, Mason began toiling for TSA.     Two

months later — on February 29 — TSA sent him an e-mail announcing

that the Agreement "will not be extended for an additional one-

year period and will automatically expire April 1, 2012."   The e-

mail proposed that, should the parties "agree to continue the

employment relationship on and after April 1, 2012, then the

employment relationship shall be in accordance with" the Offer

Letter and the New Agreement.




                                 - 5 -
             Mason sought to clarify whether his employment with TSA

was being terminated as of April 1.        In an e-mail sent on March

31, TSA responded that it was not terminating Mason's employment

but, rather, was simply declining to renew the Agreement.     It went

on to state that Mason's subsequent employment would be governed

by the documents signed in December of 2011 (including specifically

the Offer Letter and the New Agreement).      Mason continued to work

for TSA until May 17, 2012, when TSA furloughed him as part of a

company-wide reduction in force.

             Mason did not go quietly into this bleak night.       He

repaired to a California state court and sued TSA for breach of

contract, breach of the implied covenant of good faith and fair

dealing, and violation of section 203 of the California Labor Code.

Citing diversity of citizenship and the existence of a controversy

in the requisite amount, TSA removed the case to federal district

court. See 28 U.S.C. §§ 1332(a), 1441. It thereafter successfully

moved to transfer venue to the District of New Hampshire.     See 
id. § 1404(a).
             After the close of discovery, the parties cross-moved

for summary judgment.      Mason resisted summary judgment on his

breach of contract claims, asserting that there were genuine issues

of material fact as to whether any of three separate events — the

December 2011 reorganization, the February 2012 non-renewal, and

the May 2012 layoff — constituted a termination without cause that


                                   - 6 -
triggered the duty to pay severance.     The district court entered

summary judgment in favor of TSA upon concluding that on a plain

reading of the relevant contractual provisions, none of these

events constituted a termination under the Agreement.    See Mason

v. Telefunken Semiconductors Am., LLC, No. 12-507, 
2014 WL 3962470
,

at *8 (D.N.H. Aug. 13, 2014).   This timely appeal followed.

II.   ANALYSIS

           We review a decision to grant or deny summary judgment

de novo.   See Bisbano v. Strine Printing Co., 
737 F.3d 104
, 107

(1st Cir. 2013); Avery v. Hughes, 
661 F.3d 690
, 693 (1st Cir.

2011).   In this instance, Mason appeals only the district court's

entry of summary judgment in favor of TSA, not the court's denial

of his own motion for summary judgment.    Hence, we take the facts

and the reasonable inferences extractable therefrom in the light

most favorable to Mason.   See Torres Vargas v. Santiago Cummings,

149 F.3d 29
, 30 (1st Cir. 1998).    We will affirm only if we are

satisfied that there is no genuine issue of material fact and TSA

is entitled to judgment as a matter of law.        See Vineberg v.

Bissonnette, 
548 F.3d 50
, 55 (1st Cir. 2008).    Such an affirmance

may rest on any ground made manifest by the record.     See Houlton

Citizens' Coal. v. Town of Houlton, 
175 F.3d 178
, 184 (1st Cir.

1999).

           Since this is a diversity case, we look to federal law

for the summary judgment framework and to state law for the


                                 - 7 -
substantive rules of decision.      See Hanna v. Plumer, 
380 U.S. 460
,

473 (1965); Artuso v. Vertex Pharm., Inc., 
637 F.3d 1
, 5 (1st Cir.

2011).   The     parties   have   stipulated   that   California   is   the

wellspring of the relevant state law, and that stipulation jibes

with the choice-of-law provisions contained in the Agreement and

the Amendment.     Consequently, we accept this stipulation at face

value without performing a full-blown choice-of-law analysis.           See

Butler v. Balolia, 
736 F.3d 609
, 612 (1st Cir. 2013); 
Artuso, 637 F.3d at 5
.

             This appeal necessarily rises or falls with the breach

of contract claims.    In contract disputes, the court may construe

clear and unambiguous contract terms as a matter of law.                See

Torres 
Vargas, 149 F.3d at 33
.       If, however, ambiguity lurks, an

examination of extrinsic evidence "becomes essential."         
Id. California follows
the familiar rule that an ambiguity

arises if, when viewed in context, a contract term is equally

susceptible to more than one reasonable meaning.            See Dore v.

Arnold Worldwide, Inc., 
139 P.3d 56
, 60 (Cal. 2006); Transamerica

Ins. Co. v. Superior Court, 
35 Cal. Rptr. 2d 259
, 264 (Cal. Ct.

App. 1994).      Whether a contract term is ambiguous is itself a

question of law.    See Blackie v. Maine, 
75 F.3d 716
, 721 (1st Cir.

1996); Allen v. Adage, Inc., 
967 F.2d 695
, 698 (1st Cir. 1992).

             Against this backdrop, a series of questions must be

asked concerning each of Mason's breach of contract claims.              To


                                     - 8 -
begin, an inquiring court must ask whether the dispositive contract

language   is     susceptible    to     more   than    one    reasonable

interpretation.      See Torres 
Vargas, 149 F.3d at 33
.      If not, the

court may proceed to construe the language and dispose of the

summary judgment motion accordingly.      See Newport Plaza Assocs. v.

Durfee Attleboro Bank (In re Newport Plaza Assocs.), 
985 F.2d 640
,

644 (1st Cir. 1993).      But if there is more than one reasonable

interpretation, the court must then ask whether the extrinsic

evidence reveals a genuine issue of material fact regarding the

meaning of the ambiguous language.        See 
Allen, 967 F.2d at 698
.

If the extrinsic evidence is "so one-sided that no reasonable

person could decide the contrary," the meaning of the language

becomes evident and the erstwhile ambiguity will not preclude

summary judgment.     Bos. Five Cents Sav. Bank v. Sec'y of Dep't of

HUD, 
768 F.2d 5
, 8 (1st Cir. 1985).      But if the extrinsic evidence

bearing on the meaning of the relevant language is "contested or

contradictory," summary judgment will not lie.        
Allen, 967 F.2d at 698
n.3.

           With this framework in place, we turn to Mason's breach

of contract claims.      We address the purported termination events

sequentially.

                A.   The December 2011 Reorganization.

           Mason's flagship claim is that the district court erred

in granting summary judgment on his breach of contract claim


                                      - 9 -
arising   out      of     the   2011    reorganization        and     the    concomitant

cessation of his employment with Tejas.                        He argues that the

relevant contractual provisions are ambiguous and that a genuine

issue of material fact exists regarding the contracting parties'

understanding of the Agreement's termination clause.

             Termination is not defined in the Agreement, and the

drafters obviously used the word in more than one sense.                                At

various places, the termination clause refers to termination "of

employment"        generally,          termination       of        "[the     employee's]

employment" specifically, and termination of "employment with the

Company."    Mason insists that one reasonable interpretation of the

Agreement is that the parties intended for termination to have the

relatively narrow meaning of termination of employment with Tejas.

He   suggests      that    construing     a    termination         clause    to    require

severance payments regardless of new employment comports with the

norm for companies in Tejas's industry and with other surrounding

language in the Agreement.

             TSA    demurs.       It     argues   that       the    plain    meaning   of

"terminate" is to "discontinue" or "sever," and that Mason's

employment    was       neither   discontinued         nor    severed       but,   rather,

transferred seamlessly from Tejas to TSA. Thus, Mason's employment

could not have "terminated" because he was never without a job.4


      4There is some inherent tension in TSA's position. On the
one hand, it argues that it is not a successor entity to Tejas and


                                              - 10 -
              "[W]ords     are   like    chameleons;     they     frequently     have

different shades of meaning depending upon the circumstances."

United States v. Romain, 
393 F.3d 63
, 74 (1st Cir. 2004).                        This

adage is relevant because the termination clause in the Agreement

is    imprecise     and,    as   such,   is   susceptible    to    either   of    the

competing interpretations urged by the litigants.                  After all, the

Agreement uses the word "termination" loosely, in reference to

"termination of employment," termination of "[the employee's]

employment," and termination of employment "with the Company."

Then, too, with respect to the continuation of benefits, the

contracting parties appear to have contemplated the possibility of

new employment following termination, yet they did not make clear

how    that   new    employment     would     relate   to   severance   benefits.

Finally, the Agreement contemplates the possibility of termination

due to "acquisition, merger, or buyout" but does not expressly

preclude severance payments even in the event of employment by the

successor entity.

              In    our    estimation,      TSA's    invocation    of   dictionary

definitions does not assist its cause.                 Even if we assume that



the language of the Release (which TSA drafted) indicates that it
sought to hire Tejas employees free and clear of obligations owed
by Tejas. On the other hand, TSA argues that Mason's employment
with Tejas transferred seamlessly from Tejas to TSA without any
termination of Mason's employment. "Having one's cake and eating
it, too, is not in fashion in this circuit," United States v.
Tierney, 
760 F.2d 382
, 388 (1st Cir. 1985), and we are skeptical
that TSA can have it both ways.


                                            - 11 -
"terminate"       means   "discontinue"    or   "sever,"   as       TSA    insists,

Mason's employment with Tejas could reasonably be found to have

been discontinued or severed regardless of any "transfer" to TSA.

Moreover, our doubts about the meaning of "terminate" must be

weighed in light of a legal regime prescribing that "unemployment

is not a prerequisite to the right to separation pay."                    Chapin v.

Fairchild Camera & Instrum. Corp., 
107 Cal. Rptr. 111
, 115 (Cal.

Ct. App. 1973).        Rather, such a right "may, and frequently does,

exist where there is no interruption whatever in the continuity of

employment." 
Id. The upshot
is that the Agreement fails to make clear

whether     the    contracting   parties    intended   that     a    termination

sufficient to trigger the payment of severance benefits could occur

even in the event of immediate reemployment by another entity as

part   of   a     company-to-company   transaction.        Consequently,        the

termination clause is ambiguous as a matter of law.

             The question, then, reduces to whether the extrinsic

evidence relating to the meaning of the clause is so conclusive

that it dispels the ambiguity.         See Torres 
Vargas, 149 F.3d at 33
;

Bos. Five 
Cents, 768 F.2d at 8
.           In ascertaining the meaning of a

contract term, evidence of the contracting parties' intent at the

time of contract formation is most significant.                 See People ex

rel. Lockyer v. R.J. Reynolds Tobacco Co., 
132 Cal. Rptr. 2d 151
,

158 (Cal. Ct. App. 2003).        This principle applies even where, as


                                       - 12 -
here, one of the litigants was not a signatory to the Agreement:

under California law, a successor in interest to a contract who

has not renegotiated the terms of the contract is bound by the

meaning assigned to its terms by the original parties. See Applera

Corp. v. MP Biomeds., LLC, 
93 Cal. Rptr. 3d 178
, 196 (Cal. Ct.

App. 2009); Spector v. Nat'l Pictures Corp., 
20 Cal. Rptr. 307
,

312 (Cal. Ct. App. 1962).     TSA is therefore bound by the shared

intent of the contracting parties to the Agreement (Mason and

Tejas).5     See 
Spector, 20 Cal. Rptr. at 312
.   Of course, post-

formation, pre-dispute conduct also may bear on the meaning of a

contract's terms.    Under California law, evidence of such conduct

may be relevant in ascertaining the contracting parties' shared

understanding of a contract's original meaning.   See Oceanside 84,

Ltd. v. Fid. Fed. Bank, 
66 Cal. Rptr. 2d 487
, 492-93 (Cal. Ct.

App. 1997).

             Here the record is largely devoid of any extrinsic

evidence showing a shared understanding between Mason and Tejas

about the meaning of "termination" as that term is used in the

Agreement.    What extrinsic evidence exists is not so one-sided as

to cure the ambiguity and compel a finding against Mason.       For




     5 We note that the Amendment did not alter any of the
substantive terms of the Agreement. It merely memorialized the
parties' understanding that TSA would assume Tejas's rights and
duties under the Agreement and effectuated that assumption by
substituting TSA for Tejas in the Agreement's text.


                                  - 13 -
example, there is conflicting evidence anent the nature of the

2011 reorganization and whether the contracting parties thought at

the time of the reorganization that Mason's employment with Tejas

was being terminated without cause.

             The   post-formation    evidence    on     which   TSA    relies

(principally, Mason's failure to seek severance payments during

the first two months of his employment with TSA) is subject to

varying   interpretations.        Furthermore,    one   of   Mason's   sworn

statements avers that he and Tejas's president (who signed the

Agreement on Tejas's behalf) understood the 2011 reorganization to

constitute    a    termination   under   the   Agreement,    regardless   of

whether Mason decided to cast his lot with the successor firm.6

             As post-formation, pre-dispute evidence, the Amendment

itself (although signed by Mason, Tejas, and TSA) tells us very

little.      Its preamble states that "as part of [a] corporate

consolidation and reorganization, Tejas will be merged into and

with [TSA] or will be dissolved as a corporate entity after January

1, 2012, and [Mason] will become employed by [TSA] as of January

1, 2012."      Withal, the Amendment is totally silent as to the




     6 We note that Mason also relies upon the sworn statement of
the former Tejas president as evidence that Tejas terminated
Mason's employment within the meaning of the Agreement. As the
admissibility of this affidavit was controverted in the court
below, we give it no weight in our analysis. Similarly, we leave
open the relevance of a document composed by TSA as part of the
2011 reorganization (colloquially known as "Exhibit A").


                                     - 14 -
mechanics of how Mason would cease to work for Tejas and start to

work for TSA.   It is equally silent as to the implications of those

actions,   including    whether   Mason   was   entitled   to   severance

benefits as a result.

           The short of it is that ascertaining the meaning of the

termination clause in the context of the 2011 reorganization hinges

largely on the credibility of Mason's claims as to the contracting

parties' shared intent and the inferences to be drawn from the

circumstances surrounding the signing of the Amendment and the

parties' conduct.      Such matters are open to reasonable dispute

and, therefore, are not the stuff of summary judgment.           Rather,

they are squarely within the province of the factfinder.            See,

e.g., Anderson v. Liberty Lobby, Inc., 
477 U.S. 242
, 255 (1986);

Mandel v. Bos. Phoenix, Inc., 
456 F.3d 198
, 206 (1st Cir. 2006).

           TSA has a fallback position.         It argues that even if

Mason's employment with Tejas was terminated in December of 2011,

the Release operated to absolve TSA of any liability for severance

benefits owed to Mason.    This argument lacks force.

           By its terms, the Release discharged TSA from "any and

all claims" that Mason may have had, including any claims resulting

from his separation from employment effective December 31, 2011.

TSA posits that this instrument extinguished any claim that Mason

may have had against TSA for severance benefits as a result of the

termination of his Tejas employment.         Although this argument has


                                    - 15 -
a certain superficial appeal, it fails to take into account Mason's

handwritten coda to the Release, which stated "EXCEPT AS AMENDED

IN 'AMENDMENT TO EMPLOYMENT AGREEMENT.'"         According to one of

Mason's sworn statements, this coda was intended to exempt from

the Release any severance obligations Tejas owed to him under the

Agreement — and its wording is reasonably susceptible to that

interpretation.        And if those obligations were exempted from the

Release — a matter on which we take no view — TSA might have

assumed them by operation of the Amendment.

          To sum up, the handwritten coda, though not compelling

Mason's construction, renders the Release susceptible to more than

one reasonable interpretation.        Extrinsic evidence in the record

does not relieve this uncertainty.        It follows that the Release

does not, as a matter of law, bar Mason's claim for severance

benefits arising out of the 2011 reorganization.           See Torres

Vargas, 149 F.3d at 33
; 
Allen, 967 F.2d at 698
n.3.

          That ends this aspect of the matter.         Because genuine

issues of material fact permeate the record, the district court

should not have granted TSA's motion for summary judgment on

Mason's claim for severance benefits arising out of the 2011

reorganization.

                  B.     The February 2012 Non-Renewal.

          Mason next claims that TSA terminated his employment

without cause when it notified him in February of 2012 that it


                                     - 16 -
would not renew the Agreement but would let it expire on March 31,

2012.    The district court rejected this claim, granting summary

judgment in favor of TSA on the basis that non-renewal was not

tantamount to termination.       See Mason, 
2014 WL 3962470
, at *8.

             As said, the effective date of the Agreement was April

1, 2009.      Its non-renewal clause explains that Tejas (and by

substitution, TSA) agreed to employ Mason "for a period commencing

on the Effective Date and ending on the first anniversary of the

Effective Date (the 'Term')."          The "Term" would be extended for

additional    one-year   periods   unless     either   party   gave   written

notice of its exercise of the non-renewal option "at least thirty

(30) days prior to the applicable anniversary of the Effective

Date."

             Mason   first   asserts   that   the   non-renewal   clause   is

ambiguous as to whether the exercise of the right of non-renewal

had the effect of ending his employment with TSA or simply ending

the protections provided by the Agreement. In his view, employment

under the Agreement was not merely "labor for wage" but, rather,

"a specific relationship with a specific employer . . . for

particular and agreed upon terms and conditions."          When employment

under those terms and conditions ended, his thesis runs, the

employment itself was necessarily terminated and the duty to pay

severance benefits was kindled.




                                       - 17 -
          Words   are     not    infinitely   malleable,   see,    e.g.,

Levinsky's, Inc. v. Wal-Mart Stores, Inc., 
127 F.3d 122
, 129 (1st

Cir. 1997), and a contract term is not ambiguous simply because an

imaginative party conjures up an alternate interpretation, see

F.D.I.C. v. Singh, 
977 F.2d 18
, 22 (1st Cir. 1992); 
Lockyer, 132 Cal. Rptr. 2d at 158
.     Read naturally, the non-renewal clause is

not susceptible to Mason's proffered interpretation.        After all,

a contract term should not be construed in isolation; rather, it

should be construed in light of the contract as a whole.           See,

e.g., Powerine Oil Co. v. Superior Court, 
118 P.3d 589
, 598 (Cal.

2005).   By the same token, a court should construe a contract to

give effect to each material term and not to render any term

meaningless.   See Lueras v. BAC Home Loans Servicing, LP, 163 Cal.

Rptr. 3d 804, 823 (Cal. Ct. App. 2013).           These tenets help to

explain why Mason's claim fails.

          "Non-renewal"    and    "termination"   are   distinct   terms

having different meanings.7      Here, moreover, the structure of the




     7 "Termination" is typically defined as the "act of bringing
to an end or concluding," Webster's Third New International
Dictionary 2359 (2002), or a "conclusion or discontinuance,"
Black's Law Dictionary 1700 (10th ed. 2014).         By contrast,
"nonrenewal" means "a failure to renew," see 
id. at 1220,
where
"renew" typically means to "make or do again," Webster's Third New
International Dictionary 1922 (2002), or to "restor[e] or
reestablish[]," Black's Law Dictionary 1488 (10th ed. 2014). This
difference in meaning is all the more clear where, as here, the
words refer to different objects: as to termination, the Agreement
speaks to various kinds of termination of employment, but as to


                                    - 18 -
Agreement makes it nose-on-the-face plain that the contracting

parties never intended to use those distinct terms synonymously.

First, the non-renewal clause appears in section two of the

Agreement under the heading "Term," whereas the termination clause

appears   in   section   six   under    the     heading   "Consequences   of

Termination of Employment." See, e.g., Alameda Cnty. Flood Control

v. Dep't of Water Res., 
152 Cal. Rptr. 3d 845
, 862 (Cal. Ct. App.

2013) (applying rule that "[w]here the same word or phrase might

have been used . . . in different portions of a [contract] but a

different word or phrase having different meaning is used instead,

the construction employing that different meaning is to be favored"

(internal quotation marks omitted)).             Second, the contracting

parties' intent to define different meanings is well-illustrated

by comparing the 30-day notice requirement in the non-renewal

clause with the 60-day notice requirement in the "without cause"

portion of the termination clause.            If the parties had intended

non-renewal to constitute termination under the Agreement, there

would have been no need for disparate notice periods.              Indeed,

such disparate periods would make no sense.

           In an effort to blunt the force of this reasoning, Mason

argues that the disparate notice periods do not foreclose the

possibility that non-renewal is a form of termination. He suggests



non-renewal, the Agreement speaks to non-renewal of the term of
the contract.


                                       - 19 -
that a jury reasonably could conclude that the contracting parties

agreed to a shorter notice period for non-renewal because they

anticipated the possibility that a decision not to renew might

occur   closer      to    the     anniversary     date.      But       common    sense

defenestrates       this     suggestion.           For    one    thing,         Mason's

interpretation would hollow out the bargained-for 60-day notice

requirement for termination without cause.                   For another thing,

there is a common-sense explanation for the disparate notice

periods: that termination would end employment with TSA altogether

whereas non-renewal would only eliminate certain protections under

the Agreement.           Mason's suggested reading completely overlooks

this explanation.

              The   marketplace      rationale     for    such     a    common-sense

reading is apparent.            The severance provisions for termination

without cause are generous (but perhaps more ephemeral than Mason

would have liked), and the contracting parties may well have wanted

to   ensure    that      either    side   could    revisit      those     provisions

periodically.       The non-renewal clause offered the parties just

such a vehicle.

              To say more about this claim would be supererogatory.

We hold that the non-renewal clause is not ambiguous in the context

of the Agreement as a whole.              See 
Dore, 139 P.3d at 60
.             Giving

the contract language its plain meaning, see 
id., TSA's exercise
of the non-renewal option did not work a termination of employment


                                          - 20 -
within the meaning of the Agreement and, thus, did not trigger an

entitlement to severance payments.              Accordingly, the district

court did not err in granting summary judgment on this claim.

                         C.     The May 2012 Layoff.

            In   the    court     below,   Mason    contended     that   TSA's

termination of his employment as part of a company-wide reduction

in force on May 17, 2012 constituted termination without cause

within the purview of the Agreement and, thus, triggered an

entitlement to severance payments.          Because Mason did not renew

this contention in his opening brief on appeal, he waived it.             See

DeCaro v. Hasbro, Inc., 
580 F.3d 55
, 64 (1st Cir. 2009).            And while

Mason did attempt to resurrect this contention in his reply brief,

that was too late.           See Cipes v. Mikasa, Inc., 
439 F.3d 52
, 55

(1st Cir. 2006); Sandstrom v. ChemLawn Corp., 
904 F.2d 83
, 87 (1st

Cir. 1990).

            We add that even if this contention had been preserved

on appeal, it would fail in light of our holding that TSA's timely

exercise of its right of non-renewal terminated the Agreement

without terminating Mason's employment.            
See supra
Part II.B.    We

explain briefly.

            To begin, TSA validly exercised its right of non-renewal

effective   March      31,    2012.   Consequently,     Mason's    subsequent

employment was not covered by the Agreement but, instead, was for

"no specified term."          Cal. Lab. Code § 2922.      Under California


                                       - 21 -
law, employment without a fixed term is presumed to be at will.

See id.; Guz v. Bechtel Nat'l, Inc., 
8 P.3d 1089
, 1100 (Cal. 2000).

             Mason      attempts    to   overcome        this       presumption.            He

suggests    that     since    he   continued      to    work       for    TSA   after     the

expiration of the Agreement, performing the same tasks under the

same job title for the same salary and benefits as he previously

had received, an implied-in-fact contract arose between April 1

and May 17.         In his view, this implied contract amounted to a

continuation       of   the   Agreement,     so    that       he     enjoyed       the   same

severance protections on May 17 as he had when the Agreement was

in force.

             This    is   little    more   than        wishful       thinking.           Under

California law, a court cannot imply a contract in fact containing

terms   that   directly       contradict     terms       of     an       express    at-will

agreement.     See Tomlinson v. Qualcomm, Inc., 
118 Cal. Rptr. 2d 822
, 830 (Cal. Ct. App. 2002); Halvorsen v. Aramark Unif. Servs.,

Inc., 
77 Cal. Rptr. 2d 383
, 385 (Cal. Ct. App. 1998).                               This is

especially true where the written agreement was signed by the

employee and expressly limits the manner in which the at-will

provisions may be altered.           See, e.g., Starzynski v. Capital Pub.

Radio, Inc., 
105 Cal. Rptr. 2d 525
, 529 (Cal. Ct. App. 2001).

Here, Mason signed two documents in December of 2011 — the Offer

Letter and the New Agreement — which explicitly acknowledged that,

absent the Agreement, his employment with TSA would be at will.


                                           - 22 -
What is more, each document stipulated that the at-will provisions

could not be altered except by a writing signed both by Mason and

TSA's president.     In the face of these unmodified documents, Mason

cannot overcome the presumption that his employment on May 17 was

at will.   See 
id. Therefore, his
layoff did not entitle him to

the prophylaxis of the Agreement (which had by then expired).            See

Halvorsen, 77 Cal. Rptr. 2d at 385
.

           In an effort to change the trajectory of the debate,

Mason argued below that even if his implied contract argument

failed, the non-renewal of the Agreement did not take effect on

April 1 because the Amendment (which had an effective date of

January 1) by some mysterious alchemy caused the Agreement's

effective date to migrate from April 1 to January 1.                 By this

logic,   the   non-renewal   could   not   have   been   effective    before

December 31, 2012 — and Mason would have still been covered by the

Agreement (and its severance protections) when he was laid off in

May.

           This argument is jejune.        The Amendment makes pellucid

that the only aspect of the Agreement that it altered was to

substitute TSA for Tejas. It provided that this substitution would

take effect on January 1, 2012, but it did not provide that either

the term of the Agreement or its effective date would in any way

be revised.




                                     - 23 -
               That is game, set, and match. We hold that Mason's claim

for severance benefits stemming from his layoff on May 17, 2012

has been waived; and that, in all events, summary judgment on that

claim was appropriate.

III. CONCLUSION

               We need go no further.8         For the reasons elucidated

above, we reverse the district court's summary judgment ruling in

part,       affirm   that   ruling   in   part,    and   remand   for   further

proceedings consistent with this opinion.            No costs shall be taxed

on appeal.



So Ordered.




        8
       Our decision today does not deal with Mason's claim for
breach of the implied covenant of good faith and fair dealing.
Even though the district court did not address this claim in any
meaningful way, it granted judgment on the case as a whole, and
Mason took pains to preserve this particular claim on appeal.
Given this sequence of events, we deem it prudent to refrain from
addressing the matter here and, instead, leave it open on remand.
Cf. United States v. Ticchiarelli, 
171 F.3d 24
, 29 (1st Cir. 1999).
In contrast, Mason did not preserve on appeal his claim for a
violation of the California Labor Code. Thus, we deem that claim
foreclosed on remand. See, e.g., United States v. Connell, 
6 F.3d 27
, 30 (1st Cir. 1993).


                                          - 24 -

Source:  CourtListener

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