17-CIV-01393 ARMANDO SOLORIO VS. XPO LOGISTICS, INC., ET AL.

ARMANDO SOLORIO XPO LOGISTICS, INC.
CARLA J. HARTLEY

MOTION FOR SUMMARY ADJUDICATION OF ISSUES TENTATIVE RULING:

Plaintiff’s motion for summary adjudication is DENIED in its entirety.

Plaintiff seeks summary adjudication of his 1st, 2nd, 4th, and 5th causes of action, as well as summary adjudication of whether Defendant XPO owed him duties to pay the claimed bonuses and commissions.

1st COA – Violation of Labor Code § 201 – Failure to Pay Wages (Bonus)

As noted by Plaintiff, the elements of a cause of action for failure to pay wages are (1) that plaintiff performed work for defendant; (2) that defendant owes plaintiff wages under the terms of the employment; and (3) the amount of unpaid wages. CACI 2700. According to Plaintiff, he has established each of these elements as a matter of law.

Plaintiff contends he was entitled to wages pursuant to the terms of the November 2013 and March 2015 Stay Bonus Agreements. He acknowledges that “he would not be entitled to any of the bonuses if his employment was terminated for ‘Cause’ as defined in clauses (i), (ii), (iii) or (iv)” of the Agreements. Plaintiff claims the undisputed facts demonstrate that he was not terminated for cause.

Defendant disputes that Plaintiff was not terminated for cause. According to Defendant, Plaintiff was terminated due to the facts that (1) Plaintiff was the subject of three DFEH complaints and one EEOC complaint during the two years preceding his termination, and (2) Defendant’s internal investigation found that Plaintiff was not forthcoming about the veracity of the allegations against him. AMF, ¶¶ 88-91. According to Defendant, these facts provided cause for termination of Plaintiff’s employment under the provisions prohibiting (1) willful violation of corporate policy relating to the honest or ethical conduct of business, (2) refusal to comply with a lawful directive of the company, and (3) gross misconduct, gross incompetence, insubordination, or deliberate disobedience of a lawful and ethical directive of the company or its officers. Defendant’s position is supported by the declaration of Max Shook, Defendant’s PMK, which states that “”XPO decided to terminate Plaintiff, because he had engaged in inappropriate practices that violated XPO’s policies and procedures. Specifically, four formal complaints had been filed with state and federal agencies against Plaintiff in the scope of two years, and Plaintiff failed to participate in the investigation into these complaints.” Shook, Decl., ¶ 3.

Ultimately, Plaintiff has not met his burden to produce evidence demonstrating, by a preponderance of the evidence, that he was not terminated for cause. Plaintiff acknowledges that Mr. Shook testified that Plaintiff’s employment was terminated “because four harassment complaints had been made against him in two years and because he had been non-cooperative when XPO tried to investigate the claims.” SSUF, ¶ 31. Plaintiff also acknowledges that, during Defendant’s investigation, he was “deemed to be less than forthcoming.” SSUF, ¶ 34. Although these facts are undisputed, they do not support Plaintiff’s claim that he was not terminated for cause. Indeed, if anything, they support the claim that Plaintiff was terminated for cause. Plaintiff also notes that “At the time Mr. Shook notified plaintiff that his employment was being terminated, Mr. Shook did not tell plaintiff that his employment was being terminated for ‘Cause’ as that term was defined in the 2013 or 2015 Stay Bonus Agreements.” SSUF, ¶ 15. This fact, however, does not establish that Plaintiff was not terminated for cause, as Plaintiff suggests.

Further, Defendant disputes a number of facts that Plaintiff has represented as material and undisputed. For example, Plaintiff contends he was not disciplined as a result of the harassment complaints against him, and that he voluntarily agreed to take an anger management course. SSUF, ¶ 41. Defendant disputes this fact based on an email from Defendant’s Human Resources Manager stating “I looked at some other options, but [anger management/counseling] seemed to be the best way to acknowledge ownership of the incident, a willingness for betterment and corrective action on your part.” Solorio Decl., Ex. 7. Plaintiff also contends he was not aware of Defendant having any policy addressing his obligation to participate in internal investigations. SSUF, ¶ 44. Defendant disputes this fact based on the existence of Defendant’s Code of Business Conduct and Ethics that was in place in 2016, which required employees to fully and promptly comply with all investigations.

Finally, Plaintiff contends that, even accepting Defendant’s proferred reasons for terminating his employment, those reasons do not constitute cause pursuant to the Stay Bonus Agreements. Plaintiff, however, has provided no discussion as to whether this issue presents a question of fact, to be decided by the trier of fact, or a question of law capable of resolution in this summary judgment motion. See Binder v. Aetna Life Ins. Co., 75 Cal. App. 4th 832, 849, 89 Cal. Rptr. 2d 540, 551 (1999) (principles of contract law suggest significant possibility of triable issues regarding the meaning of a contract because of the varying reasonable inferences that can be drawn from conduct and ambiguous phrasing). Additionally, although Plaintiff claims that “any ambiguity in [the terms of the Agreements] must be construed against Defendant,” Plaintiff has provided no further argument or authority with respect to contract interpretation, beginning with the question of whether the contractual language is ambiguous or unambiguous. Instead, Plaintiff summarily contends that Defendant’s proferred reasons for the termination do not meet the definitions of disqualifying causes.

Because there are disputed issues of material fact, and because Plaintiff has provided no argument or authority indicating that the court should determine, at this stage in the proceedings, whether Plaintiff was terminated for cause, the court declines to make this determination.

Plaintiff’s undisputed material facts do not establish that he was not terminated for cause pursuant to the Stay Bonus Agreement. Further, Defendant disputes facts that Plaintiff has represented as material, and Defendant provides admissible evidence in support of those disputed facts. As a result, Plaintiff is not entitled to summary adjudication of his First Cause of Action for Failure to Pay Wages.

2nd COA – Waiting Time Penalties

Next, Plaintiff seeks summary adjudication of his Second Cause of Action for Waiting Time Penalties. As noted by Plaintiff, in order to establish a cause of action for waiting time penalties, the plaintiff must demonstrate (1) the date on which the employee’s employment ended; (2) that the employer failed to pay the employee all wages due by the required date; (3) the employee’s daily wage rate; and (4) that the employer willfully failed to pay these wages. CACI 2704.

According to Plaintiff, Defendant failed to timely pay his bonuses earned pursuant to the Stay Bonus Agreements. For the same reasons set forth above, Plaintiff has not demonstrated that he is entitled to the claimed wages in the form of bonuses pursuant to the Stay Bonus Agreements.

Plaintiff also contends that Defendant failed to timely pay commissions earned pursuant to the March 2014 Sales Commission Program Agreement. According to Plaintiff, his gross margin for the first quarter of 2016 was $125,000, which exceeded 80% of the $150,000 threshold for receiving commissions pursuant to the Sales Commission Program Agreement. However, Defendant asserts that Plaintiff agreed to give a client a $52,000 credit in June 2015. According to Defendant, this credit made Plaintiff ineligible for commission payments. AMF ¶ 84. Plaintiff does not dispute that the credit was provided or that the credit affected his eligibility for commissions. Rather, he objects to the evidence based on the grounds that Mr. Shook lacks personal knowledge. Mr. Shook’s testimony, however, establishes that he has personal knowledge that the credit was issued in Jun 2015. Shook Depo., p.75-77. Further, Mr. Shook’s testimony establishes the existence of a good faith dispute as to whether Plaintiff is entitled to commissions. Accordingly, Defendant has established the existence of triable issues of fact with respect to (1) whether Defendant failed to pay all wages due and, if so, (2) whether the failure to pay was “willful.” Accordingly, Plaintiff is not entitled to summary adjudication on the Second Cause of Action for Waiting Time Penalties.

4th & 5th COA – Breach of Contract & Breach of Covenant of Good Faith

For the same reasons outlined above, Plaintiff has not established the elements of duty or breach necessary to his Fourth Cause of Action for Breach of Contract or his Fifth Cause of Action for Breach of the Covenant of Good Faith and Fair Dealing. As a result, Plaintiff is not entitled to summary adjudication of these causes of action.

Issues Eight through Fourteen – Duty

In the remaining issues identified in Plaintiff’s motion, Plaintiff seeks a determination that Defendant owed him duties to pay the claimed bonuses and commissions pursuant to the Stay Bonus Agreements and the Sales Commission Program Agreement. Plaintiff’s request is denied. First, Plaintiff has not presented cogent argument or authority indicating that separate resolution of the duties owed by Defendant, apart from those pertaining to causes of action addressed by Plaintiff’s motion, is necessary or appropriate. Second, Plaintiff has presented no independent argument addressing issues eight through fourteen identified in Plaintiff’s notice of motion. Third, notwithstanding these defects, the court denies the request to find duties owed to Plaintiff on substantive grounds for the same reasons set forth in the discussion ab