United States Court of Appeals

For the First Circuit

No. 06-1745

JOHN P. BOHNE,

Plaintiff, Appellee,

v.

COMPUTER ASSOCIATES INTERNATIONAL, INC.,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. William G. Young, U.S. District Judge]

Before

 Boudin, Chief Judge,

Selya and Stahl, Senior Circuit Judges.

Brigitte M. Duffy, Jennifer A. Serafyn and Seyfarth Shaw LLP

on brief for appellant.

John P. Bohne on brief pro se.

February 1, 2008
-2-

Per Curiam. On August 19, 2002, John Bohne was

terminated--allegedly for a violation of company rules--from his

job as a sales executive for Computer Associates International.

That termination formed the basis for a diversity lawsuit, filed by

Bohne in the federal district court in Massachusetts, asserting

various causes of action--state and federal, common law and

statutory--against Computer Associates.

Of these claims, only one survived summary judgment and

reached trial: Bohne's argument that he was entitled to a

commission on a sale he had arranged prior to his termination. He

contended that under Massachusetts law, his at-will employment

contract included an "implied covenant of good faith and fair

dealing" that entitled him to the commission, even though no

commission was due to him under the terms of his contract.

After a three-day trial, the jury returned a verdict for

Bohne; the special verdict form revealed that the jury had rejected

one, but accepted the other, of the two theories of liability

charged by the district judge. The former claim was that the

termination had been made in bad faith in order to deprive Bohne of

his commission; this is a theory well established under

Massachusetts law. Fortune v. Nat'l Cash Register Co., 364 N.E.2d

1251, 1257 (Mass. 1977). But the jury rejected this claim on the

merits, presumably because it thought that Bohne had not proved the

forbidden motive for his discharge. This is not surprising because
If payment was received between 90 and 180 days after coming 1

due, the employee would receive only half of the otherwise

applicable commission; after 180 days, payment of any commission

would be in the sole discretion of the management.

-3-

under the terms of the contract, discussed below, firing Bohne

would not automatically or necessarily deprive him of commissions

for sales already transacted.

The claim that the jury accepted and on which it based

the judgment for Bohne was an alternative theory submitted to it by

the district judge. This theory permitted the jury to determine

that the provision of the contract under which Bohne was denied

compensation was itself unlawful. Computer Associates now appeals,

arguing that the district judge incorrectly instructed the jury and

should have granted its post-trial motion for judgment as a matter

of law as to the theory. See Bohne v. Computer Assocs. Int'l,

Inc., 445 F. Supp. 2d 177, 184 (D. Mass. 2006). This presents a

question of Massachusetts law, which we consider de novo. Salve

Regina College v. Russell, 499 U.S. 225, 231 (1991); SEC v. Happ,

392 F.3d 12, 19, 28 (1st Cir. 2004).

Under the sales compensation plan that governed Bohne's

employment, an employee was contractually entitled to a sales

commission so long as, inter alia, payment from the sale was

received by Computer Associates within 90 days of coming due; but 1

if the employee was terminated, he would not be owed any

commissions on sales for which payment was not received within 30
-4-

days of the termination. The contested jury instruction, delivered

over defense objection, asked the jury to determine whether this

latter plan provision--pursuant to which Bohne lost the disputed

commission--was "so unfair as to violate the general covenant of

good faith and fair dealing."

We can find no basis in Massachusetts law for such an

instruction. The doctrine of good faith and fair dealing "concerns

the manner in which existing contractual duties are performed,"

Eigerman v. Putnam Invs., Inc., 877 N.E.2d 1258, 1265 (Mass. 2007),

not the lawfulness of the agreement itself. It constrains a

party's discretion so that "the objectives of the contract [are]

realized," but does not "create rights and duties not otherwise

provided for." Uno Rests., Inc. v. Boston Kenmore Realty Corp.,

805 N.E.2d 957, 964 (Mass. 2004). Ensuring that a party does not

act to undermine the goals of the contract is one thing; holding

the contract unlawful on its face is another.

Massachusetts law recognizes other doctrines that concern

the enforceability vel non of contractual terms. For example, a

judge can make a legal determination that a contract is

unconscionable--if "the sum total of the provisions of a contract

drive too hard a bargain," Waters v. Min Ltd., 587 N.E.2d 231, 234

(Mass. 1992). Or a contract or contractual provision can be held

unlawful because it is found to violate public policy. A.Z. v.

B.Z., 725 N.E.2d 1051, 1058 (Mass. 2000).
-5-

But under neither doctrine is a jury entitled to

determine that a contract is unenforceable because it is unfair.

Zapatha v. Dairy Mart, Inc., 408 N.E.2d 1370, 1375 (Mass. 1980);

Green v. Richmond, 337 N.E.2d 691, 695 (Mass. 1975). Allowing a

jury to pass on the lawfulness of contractual terms could raise

serious problems in assuring the stability and predictability of

contractual arrangements. In any event Massachusetts law does not

provide for the jury to decide that a contract provision is itself

"so unfair as to violate the general covenant of good faith and

fair dealing."

Bohne did not ask the district judge to strike down the

termination provision as unlawful under established Massachusetts

doctrines governing illegality; and it is unlikely that any such

argument could succeed on these facts. The Massachusetts Supreme

Judicial Court (SJC) has tested for "reasonableness" forfeitures

that are triggered when employees go to work for competitors, but

only by analogy to non-compete covenants, which have anticompetitive effects not implicated here. See Cheney v. Automatic

Sprinkler Corp., 385 N.E.2d 961, 966 (Mass. 1979); Struck v.

Plymouth Mortgage Co., 605 N.E.2d 296, 298 (Mass. 1993).

In all events under the contractual provisions that

applied in this case the termination of an employee for cause did

not itself forfeit commissions already earned; it was only if the

purchase price remained unpaid for 30 days after the termination
-6-

that the commission was cancelled. There were also time limits for

those who remained employed, and the difference in treatment is

plausibly explained by a desire to close the books on discharged

employees. We understand that the district judge considered the

theory on which Bohne prevailed to be a logical extension of

Fortune, but "[i]f Fortune is to be extended, this is a matter for

the Massachusetts courts and not for us." Sargent v. Tenaska,

Inc., 108 F.3d 5, 10 (1st Cir. 1997). Accordingly, the only theory

on which Bohne prevailed cannot support the judgment, which must

therefore be vacated.

To avoid confusion in future cases, we note that Bohne

did not seek an instruction based on the Massachusetts SJC's

decision in Gram v. Liberty Mut. Ins. Co., 429 N.E.2d 21 (Mass.

1981). Gram extended the Fortune doctrine to require employers who

terminate "without good cause"--even though without bad-faith

intent--to pay any compensation clearly related to employees' past

services, even if not yet contractually due. Id. at 28-29. So (in

theory) a lawsuit might fail under Fortune yet succeed under Gram--

e.g., if the employee was fired for a baseless reason--although

Massachusetts case law has interpreted "good cause" very liberally

in favor of employers, e.g., York v. Zurich Scudder Invs., Inc.,

849 N.E.2d 892, 899-900 (Mass. App. Ct. 2006).

But Bohne has waived this potential claim by failing to

raise it. That he proceeded pro se might entitle him to some
The SJC has reserved that question, Gram v. Liberty Mut. Ins. 2

Co., 461 N.E.2d 796, 798 (Mass. 1984), and has emphasized that the

good faith covenant "is only as broad as the contract that governs

the particular relationship." Ayash v. Dana-Farber Cancer

Institute, 822 N.E.2d 667, 684 (Mass. 2005); see also Moriearty et

al., 45 Mass. Practice--Employment Law § 3.3, at 166-67 (2003)

(noting that parties can arguably bargain around the Gram

extension, though presumably not around bad faith proper).

-7-

lenience in construing arguments that he did make, but we cannot

order a new trial on a potential claim that was not raised either

in the district court or even on appeal. As it happens, it is far

from clear that a claim based on Gram could succeed where (as here)

the at-will contract includes an explicit forfeiture clause, and 2

anyway Bohne made no serious attempt at trial to demonstrate that

his discharge was without good cause.

The judgment is reversed and the case remanded for entry

of judgment in favor of Computer Associates. Each side shall bear

its own costs on this appeal.

It is so ordered.