TILMAN E. SELF, III, District Judge.
Plaintiff James W. Bearden filed the instant action against E. I. du Pont de Nemours and Company ("DuPont") asserting a breach of contract claim after DuPont cancelled certain stock options that Mr. Bearden alleges he earned during his employment. Before the Court for consideration are the parties' cross-motions for summary judgment [Docs. 43; 44] and Plaintiff's Motion to Strike Dineen Declaration [Doc. 51]. For the reasons that follow, the Court
In March of 1980, Mr. Bearden began working for Griffin Corporation, which became Griffin LLC in 1998 through a joint venture between Griffin Corporation and DuPont. [Doc. 53-2, at ¶¶ 1-2]. As a result of the joint venture, Mr. Bearden became an employee of Griffin LLC. [Id. at ¶ 3]. Five years later, when DuPont acquired Griffin Corporation's interest in Griffin LLC, Griffin LLC became wholly owned by DuPont. [Id. at ¶ 5]. Then, in January 2005, all Griffin LLC employees, including Mr. Bearden, became employees of the Defendant company, E. I. du Pont de Nemours and Company. [Id. at ¶ 6]; see also [Doc. 50, at ¶ 1].
DuPont granted Mr. Bearden the disputed stock option awards in the years 2009-2011, subject to Award Terms (the "Award Terms") for each year. [Doc. 53-2, at ¶ 9]. The Award Terms
[Id. at ¶ 12] (emphasis added). The Award Terms for Mr. Bearden's 2009-2011 stock options contain materially identical language regarding the impact an employee's termination of employment has on the stock options. [Id. at ¶ 13]; see also [Doc 44-5, at pp. 2-7]. Additionally, the Award Terms provide that, if termination of employment is "Due to Any Other Reason (such as voluntary termination)," the options "must be exercised by the date on which you terminate employment." [Id. at ¶ 14]; see also [Doc. 44-5, at pp. 3, 5, 7]. However, if termination is "Due to Retirement (as defined in the applicable pension or retirement plan or plan company policy)," the Award Terms state that "the options will be exercisable through the "Expiration Date set forth above." [Doc. 53-2, at ¶ 15]; see also [Doc. 44-5, at pp. 2, 4, 6].
To better explain this provision, the "Expiration Date" for each granted stock option is "set" by the Award Terms of that specific grant. For example, the Award Terms for Mr. Bearden's 2009 stock options "set" an expiration date of February 3, 2016. [Doc. 44-5, at p. 2]; see also [Docs. 53-2, at ¶ 16; 54-1, at ¶ 3]. His 2010 stock options contained an expiration date of February 2, 2017, and the stock options granted to Mr. Bearden on February 2, 2011, had an expiration date of "February 1, 2018 or two years after the date of [Mr. Bearden's] death if earlier." [Doc. 44-5, at pp. 4, 6]; see also [Docs. 53-2, at ¶ 16; 54-1, at ¶¶ 5, 7].
In addition to the 2009-2011 Award Terms, there are two other documents pertinent to this case: The Pension and Retirement Plan (the "Plan")
With respect to employees like Mr. Bearden
Mr. Bearden, however, emphatically disputes these contentions and takes the position that DuPont "consider[ed]," until the filing of its summary judgment materials, "the July 2013 Pension and Retirement Plan to be the applicable pension or retirement plan or plan company policy" incorporated by reference in the Award Terms. [Doc. 53-2, at ¶¶ 17-18]; see also [Doc. 43-4, at p. 8 ("Plaintiff's termination was not a `retirement' under the definition in the applicable July 2013 Pension and Retirement Plan in place at the time of Plaintiff's termination.")]. However, this erroneous labeling proves to be the source of much confusion in resolving the disputes for this case. There is no such thing as a "July 2013 Pension and Retirement Plan." As discussed in greater detail below, what Mr. Bearden refers to as the "July 2013 Pension and Retirement Plan," despite its heading, is simply the Summary [Doc. 43-3, at pp. 2-33].
When Mr. Bearden, at the age of 67, terminated his employment with DuPont on April 30, 2015, he had fulfilled 10.33 years of service. [Doc. 54-1, at ¶¶ 9-11]; see also [Doc. 42-3, at p. 104:12-14]. Before finalizing his retirement, Mr. Bearden never held any discussions with anyone at DuPont regarding how his departure might impact his stock options. [Doc. 53-2, at ¶ 30]. Following his departure, Mr. Bearden had at least five years of service with DuPont and was over the age of 65, but because he could not (as DuPont contends) meet any definition under Section IV of the Plan, he received a vested deferred pension under Section V. [Id. at ¶ 32]. Section V of the Plan provides that if an employee is terminated "for any reason other than retirement under the provisions of Section IV" and has at least five years of service and has reached the age of 65, that employee may receive a "deferred pension."
However, in May of 2015, Mr. Bearden, after logging on to his Merrill Lynch account "discovered that his 2009-2011 and 2013 stock options had expired."
A party is entitled to summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). As to issues for which the movant would bear the burden of proof at trial, the "movant must affirmatively show the absence of a genuine issue of material fact and support its motion with credible evidence demonstrating that no reasonable jury could find for the non-moving party on all of the essential elements of its case." Landolfi v. City of Melbourne, 515 F. App'x 832, 834 (11th Cir. 2013) (citing Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993)). As to issues for which the non-movant would bear the burden of proof at trial, the movant may (1) simply point out an absence of evidence to support the non-moving party's case or (2) provide "affirmative evidence demonstrating that the [non-movant] will be unable to prove its case at trial." United States v. Four Parcels of Real Prop. in Greene & Tuscaloosa Ctys., 941 F.2d 1428, 1438 (11th Cir. 1991) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)).
Once the movant satisfies its burden, the burden shifts to the non-movant, who must "go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact exists." Porter v. Ray, 461 F.3d 1315, 1320 (11th Cir. 2006) (citing Fitzpatrick, 2 F.3d at 1115-17) (emphasis added). "A factual dispute is genuine `if the evidence is such that a reasonable jury could return a verdict for the [non-moving] party.'" Four Parcels, 941 F.2d at 1437 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, (1986)).
The standard of review for cross-motions for summary judgment does not differ from the standard applied when only one party files a motion. See Am. Banks Ins. Grp. v. United States, 408 F.3d 1328, 1331 (11th Cir. 2005). "Cross-motions for summary judgment will not, in themselves, warrant the court in granting summary judgment unless one of the parties is entitled to judgment as a matter of law on facts that are not genuinely disputed." United States v. Oakley, 744 F.2d 1553, 1555 (11th Cir. 1984) (internal quotation marks and citations omitted). The Court will consider each motion on its own merits, resolving all reasonable inferences against the party whose motion is under consideration. See Am. Bankers Ins. Grp., 408 F.3d at 1331. However, "[a] court need not permit a case to go to a jury . . . when the inferences that are drawn from the evidence, and upon which the non-movant relies, are implausible." Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 743 (11th Cir. 1996) (internal quotations omitted).
The parties' cross-motions for summary judgment present well-reasoned arguments in support of what they believe should be the outcome of this case. Even though the record before the Court is quite extensive, the legal issues are relatively straightforward.
As an initial matter, Mr. Bearden seeks to strike the Declaration of Mary Dineen ("Dineen Declaration") pursuant to Federal Rules of Civil Procedure 26(e) and 37. [Doc. 51, at p. 1]. In his Motion to Strike [Doc. 51], Mr. Bearden avers that the Dineen Declaration is nothing more than a "sham affidavit" taking an "about-face" position to prior positions taken by DuPont during the discovery period on the "most central issues" of the case: (1) the identification of the applicable plan or plan company policy; (2) where in the plan or plan company policy "retirement" is defined; and (3) the reason why Mr. Bearden was not considered retired. [Id.].
Federal Rule of Civil Procedure 26 states that "a party must, without awaiting a discovery request, provide" "the name . . . of each individual likely to have discoverable information—along with the subjects of that information—that the disclosing party may use to support its claims or defenses" as well as "all documents . . . that the disclosing party . . . may use to support its claims or defenses." Fed. R. Civ. P. 26(a)(1)(A)(i)-(ii). And, as Mr. Bearden urges, "[i]f a party fails to provide information or identify a witness as required by Rule 26(a) or (e), the party is not allowed to use that information or witness to supply evidence on a motion, at a hearing, or at trial, unless the failure was substantially justified or is harmless." Fed. R. Civ. P. 37(c)(1).
As previously mentioned, there are two other documents pertinent to this case: the Plan [Doc. 44-6, at pp. 23-65] and the Summary [Doc. 43-3, at pp. 2-33]. Perhaps the parties' repeated references to the Summary as the "actual plan" by calling it the "July 2013 Pension and Retirement Plan" is the source of confusion. To clarify, the Summary is in fact, not a "pension plan." Rather, the Summary is merely "a concise description of Plan coverage" as amended on January 20, 2011. [Doc. 43-3, at p. 4]; see also [Doc. 44-6, at p. 23]. Therefore, the Summary is not, by any means, a governing document in this case and was undoubtedly issued to DuPont employees in an attempt to "communicate" information about the Plan in "easily and understandable terms." [Doc. 43-3, at p. 4]. Most importantly, the Summary by its own terms provides, "In the event of a discrepancy between [the Summary] and the Plan [], the Plan [] will govern." [Id.]. As such, the Court, in deciding this case, will only look to the Plan. Any arguments referencing the Summary, any purported definition contained in the Summary, or ambiguities within it are therefore considered moot.
To the extent Mr. Bearden argues that he was "ambush[ed]" by Mary Dineen's declaration, such allegation is not supported by the record. [Doc. 51, at p. 5]. Even though Mr. Bearden's contentions that the inner workings of the Compensation Committee were briefly disclosed during the early stages of discovery in this case are, to some extent true, DuPont's arguments in response to the motion to strike also present valid points. For example, DuPont first identified Ms. Dineen in its initial disclosures and stated that "[she] may have knowledge or information regarding the expiration of [Mr. Bearden's] stock options, the allegations set forth in the Complaint, and Defendant's defenses." [Doc. 55, at p. 5]; see also [Doc. 51-2, at p. 4, ¶ 12]. Mr. Bearden, in reply, later admits that "Dineen was disclosed in discovery" but "only as having the same scope of knowledge that DuPont described for every witness it identified in its initial disclosures[.]" [Doc. 59, at p. 5]. Likewise, the Court concludes that Ms. Dineen was, in fact, disclosed. However, the Court does not condone such vague, "copy and paste" initial disclosure practices, especially when the party knows that the particular witness in question has such pivotal knowledge that will almost certainly impact the outcome of the case. Proper, or rather more pertinent disclosure, could have prevented unnecessary expense and unnecessary use of both parties' and the Court's time.
Nevertheless, the Dineen Declaration [Doc. 44-6, at pp. 2-6] will not be excluded from the record based on the Court's finding that it is not a sham affidavit. The Court's arduous cull of this case's extensive record in order to understand the issues before it underscores the need for the clarification provided by the Dineen Declaration. In the Court's opinion, Ms. Dineen's statements did not contradict previous interrogatory responses. Instead, her statements were mere clarifications and as such, for the reasons discussed below, a Rule 37 sanction imposed on DuPont regarding the timeliness of its disclosure of the Dineen Declaration is not warranted.
Despite Mr. Bearden's belief that he "is not required to engage in a number of expensive depositions to potentially [uncover] information which should have been disclosed in [DuPont's] initial disclosures and interrogatory responses," he never sought to take Ms. Dineen's deposition after learning what knowledge she might possess. [Doc. 59, at p. 7]; see, e.g., [Doc. 42-5, at p. 25:11-19 (". . . I have an idea that we — we probably went to the subject matter expert, the pension expert, within the COE, Ms. Mary Dineen. . . .")]. Mr. Bearden states that DuPont "failed to disclose the relevance of the Compensation Committee," however, a litigant should not rely on its opponent to identify all information that might be critical (or even relevant) to his case. [Doc. 59, at p. 7].
Regardless of whether this information should have been presented in an initial disclosure, the fact remains that DuPont disclosed it in its motion for summary judgment. If Plaintiff felt that DuPont had sandbagged him by revealing critical information at a late stage, he could have asked the Court to "pause" the proceedings or otherwise reopen discovery so that Mr. Bearden could depose Ms. Dineen in order to determine the veracity of her statements, the depth of her knowledge and the impact of that knowledge on his case. See Fed. R. Civ. P. 56(d). However, Mr. Bearden has not asked the Court to allow him the chance to test Ms. Dineen's knowledge and truthfulness through cross-examination. Rather, the Plaintiff has only asked the Court to exclude her clearly relevant and important declaration. Accordingly, the Court
Having established that the Plan is clearly the governing document in this case, the ultimate issue before the Court is now whether the Compensation Committee interpreted the Award Terms in bad faith. The Compensation Committee interpreted "Retirement" (as it is used under in the 2009-2011 Award Terms [Doc. 44-5, at pp. 2, 4, 6]) to mean "Normal Retirement" as defined in Section IV of the Plan. [Doc. 44-6, at p. 5, ¶ 12]. Section IV of the Plan defines "Normal Retirement" as retiring "after reaching age 65 with at least 15 years of service." [Id. at p. 28]. Thus, because Mr. Bearden only had 10.33 years of service, the Compensation Committee determined he did not "retire" as defined in the Plan, but rather, voluntarily terminated his employment.
In spite of the Compensation Committee's interpretation, Mr. Bearden argues in his summary judgment motion
As a preliminary matter, Mr. Bearden asserts that "[b]ecause an agreement is a manifestation of mutual assent on the part of two or more persons, one party to an agreement cannot `without the other party's consent, unilaterally modify the agreement once it has been executed.'" [Doc. 53, at p. 12 (quoting Kuhne v. Fla. Dep't of Corr., 745 F.3d 1091, 1096 (11th Cir. 2014))]. He argues that to the extent the Compensation Committee made any interpretation, that interpretation is void because it "would modify the terms of the contract" and effectively "moot[]" the Summary's "Other Retirement" definition and Mr. Bearden's favorable definitions of "Retirement" embedded within the Summary's "When You May Retire"
Mr. Bearden, by accepting the stock options, affirmatively assented to the specific provision of the Award terms that allowed DuPont the ability to unilaterally interpret its own documents.
The record reflects an absence of bad faith due to the Compensation Committee's consistent interpretation that the phrase "Due to Retirement (as defined in the applicable pension or retirement plan or plan company policy)" in the Award Terms refers to "Retirement" under Section IV of the Plan. [Doc. 44-6, at p. 5, ¶ 12]. In light of the Court's consideration of the Dineen Declaration, a review of this case (with the summary judgment standard in mind) reveals that Plaintiff did not present affirmative evidence to contradict the contents of the Dineen Declaration and thereby failed to show that a genuine issue of material fact exists.
This conclusion—that DuPont did not act in bad faith—is contingent upon two reasons. First, because DuPont has consistently applied this interpretation, and has never made any exceptions shows that the Award Terms (as interpreted in this case) can be a reasonable and lawful interpretation. This holds true, so long as all employees, in Mr. Bearden's position receive the same interpretation. Second, once Mr. Bearden raised his concerns regarding the expiration of his options, DuPont promptly
Plaintiff states that because neither the Award Terms nor the Plan indicates that "Retirement" should carry an interpretation different than its ordinary meaning—the dictionary definition should be used. [Doc. 43-1, at pp. 11-12]. Stated differently, Mr. Bearden takes the position that "because the pension plan does not indicate an intent to define retirement with a non-ordinary meaning, the dictionary definition controls." [Doc. 57, at p. 4]. To that end, Mr. Bearden seeks to define "Retirement" as "termination of one's own employment or career, esp. upon reaching a certain age or for health reasons." [Doc. 43-1, at p. 13 (citing Retirement, Black's Law Dictionary, 10th ed. 2014)]. Applying that definition, Mr. Bearden claims that he "retired in the ordinary sense of the word" because "he terminated his career upon reaching age 67" and because "DuPont's own employees agree that Mr. Bearden retired." [Doc. 43-1, at p. 13].
Plaintiff's argument is misplaced. The Award Terms clearly provide their own specific meaning of what constitutes "Retirement" other than what is included in the dictionary. Likewise, the Plan provides its own definitions of "Retirement," only one of which ("Normal Retirement") could conceivably apply to Plaintiff's situation. The Award Terms governing Mr. Bearden's relevant stock options clearly provide that if termination of employment is "Due to Retirement
As DuPont aptly states, the lack of a single, global definition of "Retirement" in the Plan itself should not permit the Court to impose a "global definition" or any reading of the word "Retirement" that is non-existent in the alleged contract or is inconsistent with the Plan's already existing terms. [Doc. 54 at p. 8 (citing In re Viking Pump, Inc., 148 A.3d 633, 648 (Del. 2016) (" . . . courts interpreting a contract will give priority to the parties' intentions as reflected in the four corners of the agreement, construing the agreement as a whole and giving effect to all its provisions.")]. Simply put, just because Section IV of the Plan lists multiple ways an employee can qualify for retirement does not equate to Mr. Bearden being able to ignore those definitions and incorporate a more convenient definition of his own.
Finally, in resolving Plaintiff's arguments that the Plan is ambiguous, contracts "[are] not rendered ambiguous simply because the parties in litigation differ concerning its meaning." City Investing Co. Liquidating Tr. v. Cont'l Cas. Co., 624 A.2d 1191, 1198 (Del. 1993). Instead, as DuPont iterates, contracts are ambiguous "only when the provisions in controversy are reasonable or fairly susceptible of different interpretations or may have two or more different meanings." Comet Sys. v. MIVA, Inc., 980 A.2d 1024, 1030 (Del. Ch. 2008). Given that the governing document, the Plan, only provides one definition of "Normal Retirement," it is axiomatic that no reasonable jury could find a different interpretation. Thus, if there is only one interpretation, that interpretation cannot be made in bad faith. Accordingly, the Court
For the reasons more fully explained above, the Court
In addition to these three main arguments, Mr. Bearden alleges that DuPont made an "admission in judicio" that was inconsistent with its previous discovery responses. [Doc. 51, at p. 3]. To support this allegation, Mr. Bearden directs the Court to DuPont's argument regarding the futility of his breach of contract claim. See [Doc. 31, at pp. 6-7 ("The July 2013 Pension and Retirement Plan (which was in place at the time Plaintiff resigned), in turn, contains a section entitled `When You May Retire.' . . . A prior version of the Pension and Retirement Plan similarly provided that "an employee will be eligible for Normal Retirement after reaching age 65 with at least 15 years of service.")]. Each of the above-mentioned arguments leads to one general objection—the contents of the Dineen Declaration and their impact on the central issues of this case. Mr. Bearden contends that because DuPont failed to disclose the relevance of the Compensation Committee, produce any of its members as witnesses, or produce any documents relating to the Compensation Committee, the Court should preclude it from raising this line of argument at summary judgment and/or trial. As explained above, the Court denies his Motion to Strike.
Mr. Bearden's own Award Terms provided information regarding his stock options if his employment did not terminate "Due to Retirement." [Doc. 44-5, at pp. 2-7]. His own failure to read the terms of the alleged contract or to ask questions prior to terminating his employment does not demonstrate that DuPont breached any duty owed to Plaintiff. He was fully apprised of the terms applicable to his stock options, and could have asked questions prior to his separation—if he needed clarification.
