United States District Court, D. Maryland
GARY T. PHILLIPS,
NLYTE SOFTWARE AMERICAS LIMITED
DEBORAH K. CHASANOW, District Judge.
Presently pending and ready for resolution in this employment contract case are a motion for summary judgment filed by Defendant Nlyte Software Americas Limited ("Nlyte" or "Defendant") (ECF No. 30) and motion for leave to file a surreply filed by Plaintiff Gary Phillips ("Plaintiff" or "Mr. Phillips"). The issues have been fully briefed, and the court now rules, no hearing being deemed necessary. Local Rule 105.6. For the following reasons, Defendant's motion for summary judgment will be granted. Plaintiff's motion for leave to file a surreply will be denied.
A. Factual Background
Unless otherwise noted, the following facts are undisputed. This case involves a dispute over a commission. Nlyte is a leading producer of data center infrastructure management software, which allows businesses strategically to manage their information technology assets. (ECF No. 30-4 ¶ 2). In July 2012, Nlyte hired Plaintiff to work as a Regional Sales Director, Mid-Atlatic Region, with an August 13, 2012 start date. (ECF No. 30-9, at 2, offer letter to Gary Phillips). Plaintiff negotiated his employment with Steve Tsuchiyama, Nlyte's then Vice President, Worldwide Field Operations. (ECF No. 30-8, at 21). The offer letter stated that Plaintiff's responsibilities included:
To support the general sales and professional services operations and effort of the Company. Responsibilities will include but not be limited to the sales of software and professional services, and the ongoing support and satisfaction of existing customers. Subject to change, you will be measured quarterly on sales contribution and achievement of assigned quotas. Management will determine specific duties.
( Id. ). Plaintiff's base salary was $2, 307.69 per week ($120, 000 on an annual basis). The offer letter further stated that Plaintiff would be eligible to participate in Nlyte's sales commission plan, "which will payout an additional $120, 000.00 on an annualized basis at plan." With respect to commissions, the offer letter stated:
All target commission will be based upon the achievement of specific targets referenced under the commission plan. Details of your annual commission and bonus plan will be provided to you under separate cover.
( Id. at 2-3). Plaintiff was provided with a "Fiscal Year 2013 Direct Sales Compensation Plan, " (hereinafter, "compensation plan"), which he signed on July 30, 2012. (ECF No. 30-11). The plan states, that "[i]n addition to your basic annual salary, and in order to incentivize you, you will receive additional payments in accordance with the terms of this letter, which shall be subject to tax deductions." ( Id. at 2).
Bank of America, an existing client of Nlyte's, was one of the accounts in Plaintiff's territory. Plaintiff was told to focus on the Bank of America account because there was an opportunity for an expanded relationship, and that "[i]t was a dormant account  that was not being actively worked." (ECF No. 30-8, at 26). In the Fall of 2012, Plaintiff helped develop a sales proposal for Bank of America. Nlyte held a meeting with Bank of America in October 2012, proposing two options: a license capacity expansion and a software upgrade. ( Id. at 30).
Niraj Desai is the Vice President of Field Engineering for Nlyte, in which capacity he is responsible for the technology-side of the interaction with Nlyte's customers. (ECF No. 30-7, at 3). He stated in his deposition that he prepared a PowerPoint presentation that was presented to Bank of America at a meeting in October 2012. ( Id. at 4). Included in the PowerPoint presentation was a slide showing a summary of how its software could interface with IT service delivery (also known as IT service management ("ITSM")). ( Id. at 6). Mr. Desai stated:
the reason this slide was put in here was because at the time  Bank of America was looking to acquire BMC products that are in the slide and as part of that, we wanted to show value that if they went to the BMC products, there is a value between BMC products and the NLYTE products.
( Id. at 6) (emphasis added). BMC is a business partner of Nlyte's. (ECF No. 30-5, at 6). The proposal from Nlyte in October 2012 did not involve BMC or Nlyte's ITSM connectors, however.
Bank of America passed on the software upgrade in 2012 and focused exclusively on the license capacity expansion. For the 2012 license capacity proposal, Plaintiff was negotiating pricing terms with a procurement officer at Bank of America. Ultimately, Bank of America informed Nlyte that it did not have the budget to move forward with the license capacity expansion, (ECF No. 30-5, at 7), but Plaintiff was instructed to follow up with Bank of America in early 2013.
In January 2013, John Beischer began work as the Executive Vice President of Worldwide Sales and Support for Nlyte. (ECF No. 30-5, at 3). Mr. Beischer served as Plaintiff's supervisor at that point. (ECF No. 30-8, at 8). In late January 2013, John Beischer, Sandra Denton,  and Niraj Desai were meeting with representatives of BMC at BMC's New York offices. (ECF No. 30-5, at 6). Defendant contends that coincidentally, representatives from Bank of America also were meeting with BMC that same day. ( Id. ). Nlyte representatives and Bank of America representatives met together at BMC's offices, to begin to explore the possibility of including Nlyte software in a larger software purchase that Bank of America was exploring with BMC. Through a business partner agreement, BMC sells a version of Nlyte software called BMC Nlyte Enterprise. ( Id. at 8).
In February 2013, BMC and Nlyte presented a proposal to Bank of America. ( Id. at 12). Mr. Beischer and Ms. Denton were the primary employees at Nlyte who were responsible for driving a potential deal with Bank of America. On February 28, 2013, Plaintiff received an email from Ms. Denton, asking him to forward certain documents to Nlyte's contacts at BMC, a description of Nlyte's Predict and Dashboard modules, as well as a solutions brief. (See ECF No. 30-12, at 3). Plaintiff forwarded the email to Brad Pomerantz, an employee in Nlyte's customer satisfaction department, and then to Matt Bushell, Senior Product & Corporate Marketing Manager with Nlyte. ( Id. at 2-3). Matt Bushell then sent certain documents to BMC, despite Ms. Denton's instruction that the documents be sent by Plaintiff. The email to BMC included an "analytics data sheet, " instead of the "solution brief." (ECF No. 30-6, at 7). Ms. Denton testified during her deposition that this oversight elongated the sales cycle by a couple of days. ( Id. at 8).
Later that day, Mr. Beischer sent the following email to Plaintiff:
Unless otherwise instructed, only Sandra and myself are to communicate with BMC or BoA. Only those two people, that is it. Matt is NEVER to send a customer ANYTHING. Gary, you have the potential to cash a huge check, do not blow it, go to the movies, watch TV, but do not do anything else on BoA unless asked. Sandy or I communicate, you take instructions from Sandra or I.
(ECF No. 30-13, at 2) (emphasis in original). Plaintiff responded with: "[u]nderstood, my error. I apologize for the mistake." (ECF No. 30-14, at 2).
The Bank of America/BMC Deal closed in March 2013 for approximately $2.4 million. (ECF No. 30-4 ¶ 3 & ECF No. 30-10, at 6). The parties disagree over Plaintiff's level of involvement with the Bank of America/BMC Deal and his influence on the deal. Mr. Beischer believed that Plaintiff's behavior with respect to the Bank of America/BMC Deal "was not very professional." (ECF No. 30-5, at 16). When asked during his deposition what Plaintiff should have been doing, Mr. Beischer responded:
Well, he should have been preparing the proposals. He should have been preparing the Power Points. He should have [received] this information from Matt Bushell and put it in his own Bank of America specific type document to send it to BMC, not just pass along a generic document. That is lazy. So he was not taking the initiative. He was not putting in the necessary effort into a deal of this magnitude.
( Id. at 17). According to Mr. Beischer, Plaintiff also was "not aware of every step because he was not listening when we were on the conference calls, in particular the ones with BMC. He was not auditing the proposals. He was not making the proposals look nice.... He was not keeping in touch with the customer to ensure everything was on track. Getting their feedback, what I would call the behind the scenes feedback from the customer." ( Id. at 18).
Plaintiff tells a different story. Although he concedes that Sandra Denton and John Beischer drove the Bank of America/BMC Deal, he states that he did not negotiate the terms of that deal because he was expressly told to "stand down" by his supervisor, Mr. Beischer. (ECF No. 30-8, at 68). He states, however, that "there was some input that [he] had that was part of the terms that were ultimately negotiated." ( Id. ). Owen Nisbett, the Chief Financial Officer of Nlyte, declares that "[t]he deal that closed in March 2013 between BMC, Nlyte[, ] and Bank of America was more than twice the revenue to Nlyte than a prior software upgrade and license capacity proposal that Nlyte had made to Bank of America directly in the Fall of 2012 (which did not involve BMC)." (ECF No. 30-4 ¶ 4).
After the Bank of America/BMC Deal closed, Plaintiff sent an email to Mr. Beischer on March 30, 2013:
I did get the word late yesterday from Niraj. He said that our contract was signed with BMC and sent to Owen for our signature, but that we were waiting for BMC to finalize their deal with BoA.... Also John, I had been standing down on your instructions, but I wanted to thank you now that it is official. I know you have your "process and strategy" of closing out deals and also I was advised by Niraj to lay low. So I just wanted to, again say, thank you for all the work, time and business savvy that you put into this deal to bring it across the goal line.
(ECF No. 30-15, at 2). Plaintiff ultimately received a commission of approximately $57, 606.13 for the Bank of America/BMC Deal. (ECF No. 33-2 ¶ 59). When Mr. Beischer informed Plaintiff about his commission, Plaintiff stated that he did not think it was a fair amount. (ECF No. 30-8, at 60-61). Plaintiff believes that he should have received commission on the full value of any deal that closed within his territory, regardless of the work he put into the deal. He believes that he should ...