Court Opinion

ID: 9410804
Source: CourtListenerOpinion
Date Created: 2023-07-24 17:01:20.158608+00
Date Added: 2024-06-11T17:21:00.538062
License: Public Domain

USCA11 Case: 21-14428     Document: 36-1      Date Filed: 07/24/2023   Page: 1 of 19

                                                    [DO NOT PUBLISH]
                                     In the
                 United States Court of Appeals
                          For the Eleventh Circuit

                           ____________________

                                 No. 21-14428
                            Non-Argument Calendar
                           ____________________

        JAMES O’SHEA,
                                                        Plaintiﬀ-Appellant,
        versus
        OMI HOLDINGS INC.,
        HOIST PARTS INC.,
        d.b.a. Omi Crane Services,
        ROBERT M. BUNNEL,
        TOM CODIANA,

                                                    Defendants-Appellees.

                           ____________________
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        2                          Opinion of the Court                      21-14428

                    Appeal from the United States District Court
                       for the Northern District of Alabama
                        D.C. Docket No. 2:20-cv-01616-KOB
                             ____________________

        Before JORDAN, NEWSOM, and LUCK, Circuit Judges.
        PER CURIAM:
               James O’Shea appeals the district court’s order dismissing his
        breach of contract, fraud, and declaratory judgment claims. After
        careful review, we affirm.
                                                                                      1
            FACTUAL BACKGROUND AND PROCEDURAL HISTORY

               In early 2015, Robert Bunnel and Tom Codiana—the chief
        executive officer and president, respectively, of OMi Holdings,
        Inc.—approached O’Shea about a potential job. OMi and its sub-
        sidiary, Hoist Parts, Inc., engaged in “overhead crane installation,
        service, parts, inspection, repair[,] and maintenance.” O’Shea “was
        a well-known salesman in the industry.” OMi wanted to expand
        into the southeastern United States and believed O’Shea was “the

        1
         “We accept the factual allegations in the complaint as true and construe them
        in the light most favorable to the plaintiff.” Luke v. Gulley, 975 F.3d 1140,
        1143 (11th Cir. 2020) (citation omitted). And we treat the employment offer,
        employment letter, and employment agreement—which were attached to the
        motion to dismiss—as incorporated into O’Shea’s second amended complaint
        by reference because they were referred to in the complaint, central to
        O’Shea’s claims, and of undisputed authenticity. See id. at 1144 (citation omit-
        ted).
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        21-14428               Opinion of the Court                         3

        right guy to lead the effort” to open and run its new operation in
        Birmingham, Alabama.
               During a series of telephone and email negotiations in late
        March and early April, O’Shea “raised the issue of ownership” of
        the new operation; he only had about ten more working years left,
        he told OMi, and wanted to “control his own destiny.” To that
        end, O’Shea said he had money he could invest in OMi and “was
        willing to purchase stock.” O’Shea also told OMi he was “negoti-
        ating with another crane company about coming to work for
        [them] and buying stock therein.” OMi proposed phantom stock,
        which it told O’Shea would be “the same as, or better, than real
        stock because [O’Shea] would not have to put up any money.”
               On March 25, OMi formally offered O’Shea a job managing
        its “Southeast Aftermarket Operation.” According to the employ-
        ment offer, O’Shea’s compensation package would include a base
        salary plus a “[p]hantom [s]tock arrangement where [O’Shea]
        would be entitled to 25%” of the operation. The phantom stock
        arrangement had two components. First, once the operation
        achieved profitability, O’Shea would receive 25% of its earnings
        (before interest, taxes, depreciation, and amortization), distributed
        as often as quarterly. Second, “[i]n the event of an exit of the [op-
        eration] by the shareholders[, O’Shea] would be treated the same
        as the shareholders relative to [his] piece” and thus receive 25% of
        the purchase price. This initial offer identified as “advantages of [a
        p]hantom [s]tock arrangement”: (1) that “O’Shea d[id] not have to
        put any money into the deal” and so could simply walk away “[i]f
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        4                     Opinion of the Court                21-14428

        it crashe[d] and burn[ed]”; and (2) that O’Shea’s “distributions”
        would be “treated as compensation[,] avoiding double taxation.”
               Although O’Shea “had never heard of phantom stock,” he
        did not seek legal representation. Instead, over the next week,
        O’Shea and OMi continued negotiating and eventually reached an
        agreement “memorialized” in a March 31 “Employment Letter.”
        Under the finalized employment agreement, O’Shea’s “compensa-
        tion package in [his] role” as general manager included the base
        salary as well as a phantom stock arrangement under which, this
        time, O’Shea “would be entitled to 30% of the Southeast Aftermar-
        ket Operation.” The phantom stock arrangement again consisted
        of an earnings-based component, plus his “piece” (that is, 30%) of
        the purchase price “[i]n the event of an exit of the [operation] by
        shareholders.” The agreement laid out sample calculations of
        O’Shea’s share of hypothetical annual earnings and a hypothetical
        purchase. The agreement also provided that, “[i]n the event
        [O’Shea’s] employment with OMi cease[d] for any reason, this
        agreement shall terminate.”
               The March 31 letter was signed by Codiana on behalf of
        OMi, and O’Shea signed a substantively identical document labeled
        “Employment Agreement” and dated April 6, 2015. OMi and
        O’Shea then started the Southeast Aftermarket Operation, and
        O’Shea managed it for over five years. During that time, O’Shea
        was paid the 30% earnings-based distributions under the phantom
        stock arrangement. But O’Shea was terminated in May 2020, at
        which point he stopped receiving distributions.
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        21-14428                  Opinion of the Court                             5

                O’Shea sued OMi, Hoist, Bunnell, and Codiana in October
        2020. He asserted four claims: (1) breach of contract, based on
        OMi’s failure to pay the 30% earnings-based distributions after
        O’Shea’s termination as well as its “anticipatory breach” of its obli-
        gation to pay him 30% of the purchase price of a future sale of the
        operation; (2) fraudulent misrepresentation, based on OMi’s “false
        and misleading” representations that O’Shea “would be given an
        ownership interest . . . in the form of phantom stock” and that
        phantom stock was “the same as or better than actual stock”;
        (3) fraudulent suppression, based on OMi’s concealment of the fact
        that phantom stock does not vest and that OMi “never intended
        that [O’Shea] would keep his ownership interest” once terminated;
        and (4) declaratory judgment, seeking declarations that OMi was
        obligated to continue paying O’Shea the 30% earnings-based distri-
        butions as well as 30% of any future sale of the operation.
             The defendants moved to dismiss O’Shea’s complaint,
        which the district court granted. The district court dismissed
        O’Shea’s breach of contract claim against Codiana and Bunnell be-
                                                                             2
        cause the two weren’t, individually, parties to the contract. And
        it dismissed the breach of contract claim as to OMi and Hoist be-
        cause the plain language of the employment agreement unambig-
        uously granted O’Shea no ownership interest or vested rights that
        survived his termination. As for O’Shea’s fraud claims, the district

        2
          O’Shea conceded this point before the district court and so does not appeal
        the dismissal of his breach of contract claim as to Codiana and Bunnell.
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        6                        Opinion of the Court                   21-14428

        court found them time-barred by Alabama’s two-year statute of
        limitations for fraud actions. The district court also concluded, in
        the alternative, that O’Shea failed to state a claim for fraudulent
        misrepresentation—because he alleged neither false statements
        nor reasonable reliance—or for fraudulent suppression, because
        the contract clearly addressed the things O’Shea alleged were sup-
        pressed and because O’Shea failed to allege a duty to disclose. Fi-
        nally, the district court dismissed O’Shea’s declaratory judgment
        claim because his underlying breach-of-contract claim failed.
              After the district court denied his motion to alter the judg-
        ment, O’Shea timely appealed.
                             STANDARD OF REVIEW

                We review de novo a district court’s dismissal of a complaint
        for failure to state a claim. Luke, 975 F.3d at 1143. “To survive a
        motion to dismiss, a complaint must contain sufficient factual mat-
        ter, accepted as true, to state a claim to relief that is plausible on its
        face.” Id. (quoting Echols v. Lawton, 913 F.3d 1313, 1319 (11th Cir.
        2019)).
               We also review de novo a dismissal on statute of limitations
        grounds. See United States ex rel. Hunt v. Cochise Consultancy, Inc.,
        887 F.3d 1081, 1085 (11th Cir. 2018). “A dismissal for failure to state
        a claim on statute of limitations grounds is appropriate only if it is
        apparent from the face of the complaint that the claim is time-
        barred.” Id. (cleaned up).
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        21-14428                Opinion of the Court                          7

                                    DISCUSSION

               O’Shea argues the district court incorrectly interpreted the
        parties’ employment agreement as not conferring a vested owner-
        ship interest in the Southeast Aftermarket Operation and thus
        erred in dismissing his breach-of-contract and declaratory-judg-
        ment claims. He also argues that his fraud claims weren’t time-
        barred because they accrued in June 2020, “when [he] first began
        to discover” OMi’s intent not to honor O’Shea’s ownership interest
        after his firing, and that he reasonably relied on OMi’s false repre-
        sentations of fact when he signed the employment agreement.
               Breach of Contract and Declaratory Judgment Claims

               Under Alabama law, a plaintiff asserting a breach of contract
        claim must allege “(1) the existence of a valid contract binding the
        parties in the action, (2) his own performance under the contract,
        (3) the defendant’s nonperformance, and (4) damages.” S. Med.
        Health Sys. v. Vaughn, 669 So. 2d 98, 99 (Ala. 1995) (citations omit-
        ted). At issue here is whether O’Shea plausibly alleged OMi’s non-
        performance under the contract.
               In Alabama, “[t]he cardinal principle in the interpretation of
        any contract is that the intention of the parties should control.”
        U.S. Fid. & Guar. Corp. v. Elba Wood Prods., Inc., 337 So. 2d 1305,
        1307 (Ala. 1976) (citations omitted). In interpreting a contract, we
        give words “their clear and plain meaning and . . . presume that the
        parties intended what the terms of the agreement clearly state.”
        Pub. Bldg. Auth. of Huntsville v. St. Paul Fire & Marine Ins., 80 So. 3d
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        8                       Opinion of the Court                 21-14428

        171, 180–81 (Ala. 2010) (citation omitted); accord Reeves Cedarhurst
        Dev. Corp. v. First Amfed Corp., 607 So. 2d 184, 186 (Ala. 1992) (cita-
        tion omitted) (explaining that words in a contract are “given their
        ordinary meaning”). When a contract is unambiguous—that is,
        when “only one reasonable meaning clearly emerges,” Reeves Ce-
        darhurst, 607 So. 2d at 186 (citations omitted)—we must enforce
        the contract as written, Pub. Bldg. Auth., 80 So. 3d at 180 (citations
        omitted).
                We agree with the district court that the terms of O’Shea’s
        employment agreement unambiguously did not confer a vested
        ownership interest surviving his termination. The phrase “phan-
        tom stock” was not ambiguous. At the time the parties signed the
        contract, the plain meaning of “phantom stock” was “[i]maginary
        stock . . . credited to a corporate executive account as part of the
        executive’s compensation package.” Phantom stock, Black’s Law Dic-
        tionary (10th ed. 2014) (referring reader to “phantom stock plan”).
        And “phantom stock plan” meant “[a] long-term benefit plan under
        which a corporate employee is given units having the same charac-
        teristics as the employer’s stock shares,” “termed a ‘phantom’ plan
        because the employee does not actually hold any shares but instead
        holds the right to the value of those shares.” Phantom stock plan,
        Black’s Law Dictionary (10th ed. 2014).
               These definitions make clear that phantom stock isn’t actual
        stock held by an employee. Instead, it’s “imaginary” stock con-
        ferred as part of an employee’s “compensation package.” It has
        “the same characteristics as the employer’s stock shares”—
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        21-14428                Opinion of the Court                         9

        meaning it pays out in accordance with the value of the company’s
        actual stock—but without the employee “actually hold[ing] any
        shares.” In short, phantom stock isn’t stock ownership. See id.; cf.
        also Whitt v. Sherman Int’l Corp., 147 F.3d 1325, 1327 (11th Cir. 1998)
        (“Phantom [s]tock programs are designed to provide executives
        with cash payments equivalent to amounts they could receive un-
        der an actual stock option or similar program. Phantom programs
        are based on ‘phantom’ or ‘hypothetical’ shares or units.” (cleaned
        up) (quoting Coopers & Lybrand, Executive Summary of Nonqual-
        ified Long-term Incentive Plans, CV01 ALI–ABA 619, 632 (1996))).
                This definitional understanding of phantom stock—as not
        conferring actual stock ownership—is consistent with the con-
        tract’s other terms. The contract didn’t include any form of the
        word “own” (and the same is true of OMi’s initial employment of-
        fer). Rather, the contract identified the phantom stock arrange-
        ment as part of O’Shea’s “compensation package,” which also in-
        cluded a salary and commissions. The contract further indicated
        that O’Shea would receive his 30% earnings-based distributions “in
        the form of pre-corporate tax compensation.” What’s more, with
        respect to a potential future sale, the contract specified that O’Shea
        “would be treated the same as the shareholders”—indicating that
        he was distinct from “shareholders.” Differentiating O’Shea from
        shareholders, too, was the contract’s promise not to require O’Shea
        “to share in the initial losses” of the operation.
              Importantly, this reading of phantom stock is also consistent
        with the contract’s unambiguous termination provision, which
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        10                      Opinion of the Court                  21-14428

        stated simply: “In the event your employment with OMi ceases for
        any reason, this agreement shall terminate.” This provision made
        O’Shea’s rights under the contract contingent on his continued em-
        ployment with OMi, and it contained no exception for the phan-
        tom stock portion of O’Shea’s “compensation package.”
               In sum, to give effect to every part of the contract—includ-
        ing its broad termination provision—we agree with the district
        court that the phantom stock arrangement did not vest ownership
        of actual stock. Cf. Land Title Co. of Ala. v. State ex rel. Porter, 299
        So. 2d 289, 295 (Ala. 1974) (“[A] contract must be construed as a
        whole and, whenever possible, effect must be given to all its
        parts.”). Therefore, because the phantom stock arrangement
        didn’t confer on O’Shea a durable ownership interest or vested
        right, and because the contract provided that the parties’ agree-
        ment would terminate when O’Shea’s employment ended, OMi
        didn’t breach the contract when it ceased paying phantom stock
        distributions to O’Shea after he was terminated. For the same rea-
        sons, OMi also isn’t in anticipatory breach as to a payout for any
        future sale of the operation.
               O’Shea argues that the contract’s use of the words “piece”
        and “distribution” demonstrate an intent to confer an ownership
        interest. Like the district court, we disagree. As to the term
        “piece,” although the contract indeed referred to O’Shea’s “piece
        of the Southeast Aftermarket Operation”—as well as to his “piece
        of the purchase price” of a hypothetical future sale—the contract
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        21-14428               Opinion of the Court                        11

        explained that the reference to his “piece” referred to O’Shea’s “Af-
        termarket compensation piece.”
               As to the term “distribution,” the contract provided for
        O’Shea to “receive 30% of the [earnings] generated by the opera-
        tion in the form of pre-corporate tax compensation,” with “[t]his
        distribution . . . be[ing] made quarterly, bi-annually, or annually at
        [O’Shea’s option].” “Distribution” means “[t]he act or process of
        apportioning or giving out.” Distribution, Black’s Law Dictionary
        (10th ed. 2014); accord Distribute, Merriam-Webster (deﬁning “dis-
        tribute” as, in relevant part, (1) “to divide among several or many”
        or (2)(b) “to give out or deliver especially to members of a group”),
        https://www.merriam-webster.com/dictionary/distribute
        [https://perma.cc/P59X-SWFH]. Read in context, this contract
        provision—outlining payment frequency—plainly used “distribu-
        tion” in the “giving out” sense rather than in a stock dividend sense.
               Next, O’Shea argues that the phrase “phantom stock” was
        latently ambiguous, such that the district court should’ve consid-
        ered the parties’ course of dealing—including his clearly commu-
        nicated desire for an ownership interest and two emails attached to
        his motion-to-dismiss response—to interpret the phrase as confer-
        ring vested ownership. In the first email, O’Shea told Codiana:
              I don’t want to get into a lengthy legal document but
              we need a formal legal description of the terms of
              ownership . . . . I’m not sure how the [p]hantom
              stock works but we need to deﬁne ownership, distri-
              bution of [earnings], distribution at sale of business[,]
              and survivorship if something happens to me, etc.
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        12                     Opinion of the Court                 21-14428

        In reply, Codiana said, “Sounds to me like we can work out all the
        details you brought up.” This, according to O’Shea, shows that the
        parties were contemplating “actual ownership in the new [opera-
        tion], not some fleeting right.”
                “An ambiguity is latent when the language employed is clear
        and intelligible and suggests but a single meaning, but some extrin-
        sic fact or extraneous evidence creates a necessity for interpretation
        or a choice among two or more possible meanings.” Moore v. Penn.
        Castle Energy Corp., 89 F.3d 791, 796 (11th Cir. 1996) (quoting
        Thomas v. Principal Fin. Grp., 566 So. 2d 735 (Ala.1990)). Alabama
        law permits a court to consider extrinsic evidence “[i]n making the
        threshold determination of whether there is a latent ambiguity.”
        Dupree v. PeoplesSouth Bank, 308 So. 3d 484, 490 (Ala. 2020) (citation
        omitted).
                The problem for O’Shea is that “a contract is ambiguous
        only if it is susceptible of more than one reasonable meaning.” Black
        Diamond Dev., Inc. v. Thompson, 979 So. 2d 47, 50 (Ala. 2007)
        (cleaned up). And that’s not what the emails (or O’Shea’s expressed
        desire for ownership) reveal. The emails don’t suggest that “phan-
        tom stock” reasonably could’ve meant actual stock ownership;
        they reveal that O’Shea didn’t know what “phantom stock” meant.
        This distinguishes O’Shea’s situation from the cases he cites. Cf.
        Smith v. Aikin, 75 Ala. 209, 210, 213 (1883) (holding “two dollars per
        thousand feet” latently ambiguous because logging industry used
        both “log measure[ment]” and “line measure[ment]”); Med. Clinic
        Bd. of Birmingham-Crestwood v. Smelley, 408 So. 2d 1203, 1206 (Ala.
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        21-14428               Opinion of the Court                       13

        1981) (citations omitted) (holding “according to the plans and spec-
        ifications prepared by [the architect]” latently ambiguous because
        parties negotiated with understanding that architect’s plan was
        changing); Dupree, 308 So. 3d at 488, 491 (holding certificate of de-
        posit latently ambiguous because of handwritten changes reversing
        recipients’ names and updating recipient to which interest should
        be attributed, as well as conflicting accounts about donative in-
        tent); Mass Appraisal Servs. v. Carmichael, 404 So. 2d 666, 668, 672–
        73 (Ala. 1981) (finding latent ambiguity in main contract provision
        requiring company to “perform mass appraisal services” required
        by subcontracts between Carmichael and various Alabama coun-
        ties because main contract didn’t specify services subcontracts
        would involve). The district court thus correctly found the con-
        tract unambiguous.
               Finally, O’Shea argues that a contract’s termination doesn’t
        impact rights that have already vested—and so his termination
        couldn’t have taken away his 30% interest in the operation. He
        finds especially significant the fact that the contract’s example
        phantom stock payouts calculation contained “no contingency or
        vesting plan for O’Shea to meet in order to receive the money”—
        because, “[i]f O’Shea’s interest had not vested from the date of his
        acceptance of the agreement, the example calculation would make
        no sense.” But O’Shea’s argument assumes an ownership interest.
        He defines vesting as “the point in time when the rights and inter-
        ests arising from legal ownership of a property [are] acquired” and
        “vested right” as “having the character or giving the rights of abso-
        lute ownership; not contingent.” And he argues that his rights
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        14                      Opinion of the Court                 21-14428

        “vested when he became owner of 30% of the [o]peration.” But,
        as we’ve already explained, phantom stock is not stock ownership,
        so this argument fails.
                  Fraudulent Misrepresentation and Suppression

               Alabama’s statute of limitations for fraud actions is two
        years. Bryant Bank v. Talmage Kirkland & Co., 155 So. 3d 231, 235
        (Ala. 2014) (citing Ala. Code § 6-2-38(l) (2014)). The statute of lim-
        itations begins running either “when the plaintiff discovered the
        fraud or when the plaintiff should have discovered the fraud in the
        exercise of reasonable care.” Id. at 236 (quoting Auto–Owners Ins. v.
        Abston, 822 So. 2d 1187, 1194–95 (Ala. 2001)); see also Ala. Code § 6-
        2-3 (2014) (discovery rule).
               Usually, “when a person of reasonable prudence would have
        discovered the alleged fraud” is a jury question. Bryant Bank, 155
        So. 3d at 237. But “a party will be deemed to have ‘discovered’ a
        fraud as a matter of law upon the first of either the actual discovery
        of the fraud or when the party becomes privy to facts that would
        provoke inquiry in a reasonable person that, if followed up, would
        lead to the discovery of the fraud.” Dickinson v. Land Devs. Constr.
        Co., 882 So. 2d 291, 298 (Ala. 2003) (citing Abston, 822 So. 2d at
        1195); accord Jones v. Kassouf & Co., P.C., 949 So. 2d 136, 140 (Ala.
        2006); see also Miller v. City of Birmingham, 235 So. 3d 220, 235 (Ala.
        2017) (noting court may decide discovery issue as a matter of law
        when “the plaintiff actually knew of facts that would have put a rea-
        sonable person on notice of fraud”).
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        21-14428                 Opinion of the Court                           15

               O’Shea says he didn’t know until June 2020—when OMi
        stopped paying the 30% quarterly distributions after terminating
        him—that OMi misled him (through fraudulent statements and
        suppressions) into believing the phantom stock arrangement gave
        him a vested ownership interest in the operation. O’Shea argues
        that he “had no basis for ‘inquiring’ about his ownership interest”
        before then. At the very least, he says, there’s a genuine issue of
        fact about when he should have discovered the fraud—such that
        dismissal on statute of limitations grounds was inappropriate.
               We accept as true O’Shea’s allegations that he made clear to
        OMi that an ownership interest in the new operation was a “pre-
        requisite” to him considering its job offer—to the point where he
        was willing to invest in the business. But even assuming O’Shea is
        right that OMi’s statement describing phantom stock as “as good
        as or better than actual stock” (or the contract’s use of “language
        consistent with ownership”) could be construed as fraudulently
        “represent[ing] to O’Shea [that] he would own part of the new [op-
                   3
        eration]” —or that OMi fraudulently suppressed its intent not to
        treat O’Shea as a true owner—the undisputed facts show that
        O’Shea “should have discovered the fraud in the exercise of reason-
        able care” at the time he signed the contract, or at the very least,
        when he started receiving the quarterly distributions for the phan-
        tom stock. Cf. Bryant Bank, 155 So. 3d at 236.

        3
         O’Shea doesn’t argue Codiana’s “we can work out all the details” email was
        among OMi’s fraudulent misrepresentations.
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        16                     Opinion of the Court                21-14428

               First, it’s undisputed that O’Shea admitted not knowing
        what phantom stock was when he signed the contract. He alleged
        that he’d “never heard of phantom stock before this agreement.”
        And he alleged that, “[d]uring the parties’ negotiations, [he] told
        [OMi] that he did not know how phantom stock worked.” Second,
        the contract described the phantom stock arrangement as part of
        O’Shea’s “compensation package” and provided that OMi would
        distribute his quarterly 30% payouts as “pre-corporate tax compen-
        sation.” Third, as noted above, neither the final contract O’Shea
        signed—nor OMi’s employment offer letter—ever used any form
        of the word “own” in detailing the phantom stock arrangement.
        Plus, the contract’s only reference to shareholders noted that,
        should they “exit” the operation, O’Shea would be “treated the
        same as” them for purposes of a post-purchase phantom stock pay-
        out. Similarly, the contract said O’Shea wouldn’t be required to
        “share in the [operation’s] initial losses”—setting O’Shea apart, un-
        der the phantom stock arrangement, from an owner who, as
        O’Shea puts it on appeal, “would otherwise have to insert capital
        contributions . . . with other owners.”
               In sum, O’Shea knew the contract didn’t expressly say he’d
        be an owner of the Southeast Aftermarket Operation. He knew
        the contract didn’t require him to invest like an owner. He knew
        the contract said he’d be “treated the same as” a shareholder (not
        that he was a shareholder). He knew OMi referred to the phantom
        stock arrangement repeatedly—in his offer letter and final con-
        tract—as “compensation.” And, most importantly, O’Shea knew
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        21-14428               Opinion of the Court                      17

        there was a gap in his knowledge about a key contract term, “phan-
        tom stock.”
               These facts show numerous contradictions between the ac-
        tual terms of the contract (which didn’t mention ownership) and
        the way O’Shea perceived OMi’s representations to him (namely,
        that he’d be an owner). Such contradictions would’ve provoked
        inquiry in a reasonable person—particularly a reasonable person
        for whom an ownership interest was a critical negotiating point,
        and particularly in light of the contract’s broad termination provi-
        sion that, on its face, made no exception for the phantom stock ar-
        rangement. Dickinson, 882 So. 2d at 298. Rather than proceeding
        in ignorance but hoping “phantom stock” meant actual, vested
        ownership, a reasonable person would have acted to acquire more
        knowledge, either through independent investigation or advice of
        counsel. Yet O’Shea didn’t seek legal counsel or otherwise try to
        learn about phantom stock during the nearly two weeks between
        receiving OMi’s employment oﬀer and signing the contract. Even
        a cursory inquiry via internet search could have tipped oﬀ O’Shea
        that phantom stock is (like its name sounds) not actual stock and
        the employment agreement didn’t oﬀer him ownership. See, e.g.,
        Phantom stock plan, Investopedia (Mar. 28, 2015 7:22:35 PM),
        http://www.investopedia.com/terms/p/phantomstock.asp
        [https://perma.cc/ANJ9-N9YA] (A phantom stock plan is “[a]n
        employee beneﬁt plan that gives selected employees (senior man-
        agement) many of the beneﬁts of stock ownership without actually
        giving them any company stock. . . . Rather than getting physical
        stock, the employee receives ‘pretend’ stock [which, e]ven though
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        18                     Opinion of the Court                21-14428

        it’s not real, . . . follows the price movement of the company’s ac-
        tual stock, paying out any resulting proﬁts.”) [https://web.ar-
        chive.org/web/20150328072235/http://www.in-
        vestopedia.com/terms/p/phantomstock.asp]. Had O’Shea in-
        quired, he could’ve easily discovered the alleged fraud. See Dickin-
        son, 882 So. 2d at 298.
               These facts warrant but one conclusion: O’Shea should’ve
        discovered the alleged fraud at the time he and OMi entered into
        the contract, when he knew (1) the terms of the contract, (2) what
        he perceived OMi to be representing, and (3) that he lacked
        knowledge about phantom stock. Kindred v. Burlington N. R. Co.,
        742 So. 2d 155, 157 (Ala. 1999) (“When a claim accrues, for statute-
        of-limitations purposes, is a question of law if the facts are undis-
        puted and the evidence warrants but one conclusion.”). And so
        O’Shea’s fraud claims accrued no later than when he signed the
        contract knowing these facts.
               At the latest, O’Shea should have reasonably discovered the
        alleged fraud when he began receiving the quarterly distributions
        for the phantom stock. The payment should have put him on no-
        tice that he was not receiving actual shares of stock.
               Because O’Shea didn’t sue until October 2020, more than
        five years after signing the employment agreement on April 6,
        2015, and more than two years after he started receiving the quar-
        terly distributions for the phantom stock, we affirm the district
        court’s conclusion that his fraud claims were barred by Alabama’s
        two-year statute of limitations. We therefore need not reach the
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        21-14428               Opinion of the Court                       19

        district court’s alternative conclusion that O’Shea failed to plausi-
        bly allege his fraud claims.
              AFFIRMED.