Court Opinion

ID: 2963064
Source: CourtListenerOpinion
Date Created: 2015-09-21 21:06:01.085019+00
Date Added: 2024-06-11T11:42:37.851005
License: Public Domain

USCA1 Opinion

	

                                [NOT FOR PUBLICATION]                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 94-1842                                   JOHN R. HOLLAND,                                Plaintiff, Appellant,                                          v.                 HARTFORD COMPUTER EXCHANGE, INC., AND RONALD TALBOT,                                Defendants, Appellees.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                       [Hon. Rya W. Zobel, U.S. District Judge]
                                           ___________________                                 ____________________                                        Before                                Torruella, Chief Judge,
                                           ___________                            Coffin, Senior Circuit Judge,
                                    ____________________                              and Stahl, Circuit Judge.
                                         _____________                                 ____________________            Robert P.  Sherman  with whom  Leonard  G.  Learner and  David  R.
            __________________             ____________________      _________        DeVeau were on brief for appellant.
        ______            Scott  A. Faust  with whom  Gregory C.  Keating was  on brief  for
            _______________             ___________________        appellees.                                 ____________________                                 ____________________

               COFFIN,  Senior  Circuit  Judge.    Plaintiff  John  Holland
                        ______________________          asserts  that  the  district  court  erred  in  granting  summary          judgment for  defendants on  his claim of  constructive discharge          and on various other causes of action stemming from his departure          from  his  job  as  a  computer  salesman for  Hartford  Computer          Exchange (HCE).  Our  review of the record and  caselaw persuades          us  that, based on the evidence offered, no reasonable jury could          find  that Holland was discharged.  Because this determination is          fatal  to most  of his  claims, and  the remaining  allegation of          breach  of contract also fails as a  matter of law, we affirm the          district court's judgment in its entirety.               A district court's grant of summary judgment is  reviewed de
                                                                         __          novo.  Bourque v. FDIC, No. 94-1568, slip op. at 7 (1st Cir. Dec.
          ____   _______    ____          28, 1994).  We examine  the evidence in the light most  favorable          to the nonmovant, and  must affirm if the parties'  proof reveals          "`that there is no genuine issue as to any material fact and that          the moving  party is entitled  to judgment as a  matter of law.'"          Id. (citation omitted).
          ___               An  issue  is only  "genuine"  if  there is  sufficient               evidence  to permit  a reasonable  jury to  resolve the               point in the nonmoving party's favor . . . while a fact               is only "material" if it has  "`the potential to affect               the outcome of the suit under the applicable law.'"          Id. at 7-8 (citations omitted).
          ___               The  central question in  this appeal is  whether Holland is          entitled  to  jury consideration  of  his  constructive discharge          claim.  The  district court's  negative answer  had two  separate          prongs.   First, it determined  that, on the  facts presented, no                                         -2-

          reasonable   jury  could   conclude  other   than  that   Holland          voluntarily left  the defendants' employ.   Second, it  held that          the facts underlying the allegation of constructive discharge are          insufficient as a matter of law to support  such a claim.  In our          view,  it is unnecessary to dwell on Holland's intent because, as          the  district  court found  and as  we  shall explain  below, the          undisputed facts  fall far  short of establishing  a termination.          Cf. Vega  v. Kodak  Caribbean, Ltd.,  3 F.3d  476, 481  (1st Cir.
          ___ ____     ______________________          1993)  ("An  employee's  perceptions  cannot govern  a  claim  of          constructive  discharge   if,  and   to  the  extent   that,  the          perceptions were unreasonable.").1               A   constructive   discharge   occurs   when   an   employer          "deliberately   makes   an  employee's   working   conditions  so          intolerable  that  the employee  is  forced  into an  involuntary          resignation," Pena  v. Brattleboro Retreat, 702  F.2d 322, 325-26
                        ____     ___________________          (2d  Cir. 1983) (citation omitted),  cited in Radvilas  v. Stop &
                                               ________ ________     ______          Shop, Inc.,  18 Mass. App. Ct. 431, 439 n.14, 466 N.E.2d 832, 838
          __________          n.14  (1984).    See  also Vega,  3  F.3d  at  480 (to  establish
                           ___  ____ ____          constructive discharge plaintiff must show that his work was  "so          arduous or  unappealing, or  working  conditions so  intolerable,          that  a reasonable person would feel compelled to forsake his job          rather than to  submit to looming indignities"); Alicea Rosado v.
                                                           _____________                              
          ____________________               1 As a practical  matter, of course, there is  no difference          between the district court's  two holdings.  The  conclusion that          the  allegations failed  as  a  matter  of  law  to  establish  a          termination leads inexorably  to a finding that Holland  left HCE          voluntarily.                                         -3-

          Garcia Santiago, 562 F.2d  114, 119 (1st  Cir. 1977).2  A  change
          _______________          for the worse in  the quality of working conditions is not itself          enough to satisfy the standard; a constructive discharge involves          a "drastic  reduction" in the circumstances  of one's employment.          Alicea Rosado, 562 F.2d at 120.    Holland's       claim       of
          _____________          constructive discharge  rests upon  the fact that  his commission          percentage  was reduced  from 40  percent to  30 percent  in July          1993.3   Holland therefore needs  to show that  withdrawal of ten          percent   of  his   commission   made  his   employment  at   HCE          "intolerable,"  effectively  compelling him  to leave.   Although          Holland insists that a  25 percent paycut is so  substantial that          he must be entitled to a jury finding on its significance, we are          obliged to view that reduction within the full factual context in                              
          ____________________               2  Holland asserts  in  his brief  that Massachusetts  would          apply  a  "more liberal"  standard  in  evaluating his  claim  of          constructive discharge, but  the cases he  cites fail to  support          such  a contention  because they  involve employees  with written          employment  contracts.  See Miller v. Winshall, 9 Mass. App. 312,
                                  ___ ______    ________          318, 400 N.E.2d 1306,  1310 (1980); Steranko v. Inforex,  Inc., 5
                                              ________    ______________          Mass.  App. 253,  263, 362  N.E.2d 222,  230 (1977)  ("A material          change in an employee's duties or a significant reduction in rank          may  constitute a  breach of contract  entitling the  employee to          damages.").   Holland concededly  was an at-will  employee, which          logically implicates  different concerns.  Cf.  Henderson v. L.G.
                                                     ___  _________    ____          Balfour  Co., 852  F.2d 818,  822 n.1  (5th Cir.  1988) (applying
          ____________          Massachusetts law).               3  He  alleged,  in   addition,  a  "systematic  pattern  of          harassment"  that  consisted  entirely  of  questioning  on   two          occasions in the summer of 1993 by HCE's president about expenses          for  which Holland sought reimbursement.  One involved a new one-          year  subscription  to  the Wall  Street  Journal  and  the other          concerned the large number of  personal long distance phone calls          on Holland's July 1993 telephone bill for HCE,  including 15 to a          prospective new  employer.   At oral argument,  Holland's counsel          acknowledged that these incidents add nothing to the constructive          discharge claim, and simply were meant to be corroborative.                                         -4-

          evaluating whether any reasonable  jury could find a constructive          discharge.  We therefore summarize the relevant background.               In early 1992, when three key HCE employees left the company          to form their own business, Holland asked for a better commission          structure  as a  inducement for  him to  stay.   HCE's president,          Ronald Talbot, agreed to increase Holland's commissions to a flat          40  percent  on  gross  profits.    Under  the  tiered  structure          previously  in effect, Holland had earned a 30 percent commission          on profits up to  $75,000, 35 percent on profits  between $75,000          and $150,000, and 40 percent on gross profits over $150,000.               Two months  after the change in  compensation, Holland wrote          to  Talbot  expressing  concern  about  the  company's continuing          viability, advising him that "[u]nless you intend to rebuild HCE,          we need to plan a  graceful transition."  Holland stated that  he          planned to  begin seeking other opportunities,  and "hope[d] that          within the next 2-4 months I  can find another position."  During          the  following  fourteen  months,  Holland  and  Talbot  together          explored ways of keeping Holland at HCE, including his becoming a          part owner  of the business.   None  of these approaches  came to          fruition, and in  May 1993 Holland actively  began pursuing other          jobs,  including one  with a  sales training  firm in  San Diego.          Holland took  off a week  in June to attend  a course at  the San          Diego company,  Solution  Selling, and  another week  in July  to          attend an associates meeting there.               In mid-July, several  events occurred.   On July 15,  Talbot          wrote a  letter to Holland  noting that Holland  had said he  was                                         -5-

          leaving   HCE,  and   detailing   procedures   for  "a   workable          transition."  Holland, who denies that he ever told Talbot he was          leaving, responded with a memo on July 19:               As  you know,  all discussions  between us  regarding a               migration  from  HCE  to  Solution  Selling  have  been               contingent upon  us  reaching a  mutually  satisfactory               severance agreement.  If we are unable to reach such an               agreement, I intend to remain with HCE.               On  another  note,  this  will confirm  that  you  have               authorized me to attend the Solution Selling Associates               meeting to  be held in San  Diego the week of  July 26.               Of  course, I shall be available by phone that week and               will be checking my messages on a daily basis.               Finally, thank  you for coming to Boston  today to meet               with  me.   Per  our  discussion,  I  look  forward  to               receiving a  revised  severance package  proposal  from               you.          In a telephone conversation on July 22, and in a memo thereafter,          Talbot informed  Holland that  his commission  rate would  now be          calculated at 30 percent.  The memo stated that "[t]his plan will          be reviewed again on/about September 1, 1993."               On September 3, Holland faxed a letter to  Talbot announcing          his  departure from  HCE.    Holland  stated  that  he  was  "not          willingly or voluntarily terminating my employment with HCE," but          was being forced out by Talbot's "unilaterally changing the terms          of our  agreement and  thereby making it  economically impossible          for me to remain with the company."               We believe that no reasonable juror could conclude that this          sequence  of   events  adds  up  to   a  constructive  discharge.          Holland's  commission had  been  increased to  40  percent as  an          incentive for him to stay with  HCE, and it was not reduced until          after  Holland aggressively had been  pursuing other jobs and his                                         -6-

          departure seemed imminent.  The fact that Holland claimed that he          would not leave unless he got an adequate severance package in no          way diminishes the inference unequivocally drawn from his actions          -- that he was on  his way out the  door.  The rationale for  his          commission increase therefore no longer existed.               In addition, while a flat 30 percent rate was  a lower level
                                    ____          of  compensation  than  provided   even  in  the  earlier  tiered          structure,  it  was a  percentage  from  within that  three-level          scheme.  And, because  he already  had earned  40 percent  on all          profits through the first six months of 1993, the flat 30 percent          rate beginning in July could  not have meant much of a  change in          his average,  annual commission rate  from the percentage  he had          accepted  as satisfactory  before January  1992.   Certainly, any          difference cannot be termed so intolerable as to trigger a forced          termination.   This is  particularly so  because  the 30  percent          level  was  given limited  duration.   Talbot's memo  stated that          Holland's  compensation plan  would  be reviewed  again on  about          September 1.4               In short, the undisputed facts inescapably show that Holland          was  dissatisfied  with his  earning  potential  at HCE  and  was          looking  aggressively   for  other   opportunities.    In   those          circumstances,   Talbot's  decision   to   withdraw   a   premium          compensation  rate   explicitly  offered  as  an   incentive  for                              
          ____________________               4 In addition, by August 1993, HCE had an experienced broker          who  could help Holland  generate sales.   This was  not the case          when his commission  was increased  to 40 percent  in early  1992          after, in  his words, HCE  "lost one  of the top  brokers in  the          business."  See App. at 161 (March 1992 letter to Talbot).
                      ___                                         -7-

          continuity  can hardly  be characterized as  a termination.   The          district court therefore correctly held that the facts underlying          the allegation  of constructive  discharge are insufficient  as a          matter of law.   Cf. Nunez-Soto v. Alvarado, 918  F.2d 1029, 1031
                           ___ __________    ________          (1st  Cir.  1990)  (despite  "significantly  adverse"  employment          action, including demotion  from supervisory position,  the facts          do not show  circumstances "that  would likely  make her  quit");          Zabielski v. Montgomery Ward & Co., 919 F.2d 1276, 1281 (7th Cir.
          _________    _____________________          1990)  (constructive  discharge  claim viable  where  plaintiff's          salary  cut from $26,000 to  $9,600 and plaintiff  demoted out of          management).               Holland's claim  that Talbot committed a  breach of contract          when he withdrew  the 40 percent  rate is equally  insupportable.          Holland asserts that, when Talbot offered the higher compensation          "on a going forward basis," he  was committing to such a rate for          however long Holland remained  employed at HCE.   This assertion,          however, is based solely on Holland's subjective expectation.  As          noted, Holland was an at  will employee.  The combined  effect of          that status,  past experience  --  Talbot previously  had made  a          unilateral  reduction  in  the  commission schedule  --  and  the          context  of  the raise  --  to  induce Holland  to  stay --  make          unreasonable  any  inference  that  a  binding  contract  for  an          indefinite term  was  formed.   Holland's  effort to  generate  a          genuine factual dispute concerning this issue therefore fails.
          _______               As Holland concedes  in his brief,  the legal inadequacy  of          his  constructive  discharge  claim  extinguishes  his  remaining                                         -8-

          causes of action.  The district court's grant of summary judgment          to defendants is therefore AFFIRMED. 
                                     ________                                         -9-