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Allegis Group, Inc. v. Jordan

United States District Court, D. Maryland

March 18, 2016

ALLEGIS GROUP, INC., et al., Plaintiffs,
v.
JUSTIN JORDAN, et al., Defendants.

MEMORANDUM OPINION

GEORGE L. RUSSELL, III UNITED STATES DISTRICT JUDGE.

THIS MATTER is before the Court on Plaintiffs’, Allegis Group, Inc. (“Allegis”), Aerotek, Inc. (“Aerotek”), and Teksystems, Inc., Second Motion for Summary Judgment (ECF No. 102). Having considered the Motion and supporting documents, the Court finds no hearing necessary. See Local Rule 105.6 (D.Md. 2014). For the reasons stated below, the Court will deny the Motion without prejudice.

I. BACKGROUND

This matter involves six former Aerotek employees, including Defendants Justin Jordan, Daniel Curran, and Michael Nicholas, [1] and their activities before and after resigning.[2]Jordan served as a Regional Vice President and Curran and Nicholas served as National Account Managers and Directors of Strategic Sales. Allegis selected Jordan, Curran, and Nicholas to participate in its Incentive Investment Plan (“IIP”), which awards participants “incentive investment units” (“Units”), equivalent to a common share of Allegis stock. While employed at Aerotek, participants receive cash dividends twice a year based on the value of their Units. Allegis awards Units through Award Agreements, which employees must sign each time they earn Units. Each Defendant signed Award Agreements.

Once an IIP participant’s employment has ended, Allegis pays the participant the principle balance of the value of his Units, known as “IIP payments, ” as follows: five-percent of their balance is paid every quarter for ten quarters, and then the remaining fifty-percent of their balance is paid after thirty months. The Award Agreements state “the terms and conditions set forth in Section 9 [of the IIP] are material and essential terms of your award of Units and your eligibility to receive payment for any Units.” (ECF No.75-8). Section 9 includes non-solicitation provisions and is effective for thirty months after termination of employment. (Pls.’ Opp’n to Defs.’ Mot. for Partial Summ. J., Ex. 4 [“IIP”], at 5-6, ECF No. 75-6). After termination and before receiving IIP payments, participants were required to sign Acknowledgment Letters stating, inter alia, a breach of Section 9 terminates their ability to receive IIP payments and requires them to refund any IIP payments made. (ECF Nos. 75-7, -25, -35).

Jordan resigned on February 21, 2009, and his IIP obligations expired on August 21, 2011; Curran resigned on September 16, 2011, and his IIP obligations expired on March 16, 2014; and Nicholas resigned on January 3, 2012, and his IIP obligations expired on July 3, 2014. Jordan received all of his IIP payments, totaling over $1.45 million. At the time of their resignations, Curran was scheduled to receive $196, 470 in IIP payments and Nicholas was scheduled to receive $138, 268. Curran, however, only received two payments of $8, 851, and Nicholas only received one payment of $6, 195. Allegis discontinued the IIP payments, contending that Curran and Nicholas breached their IIP Agreements.

Plaintiffs brought claims for breach of contract, rescission, and unjust enrichment against Defendants. (ECF No. 26). On December 23, 2013, Plaintiffs filed a Motion for Partial Summary Judgment on their breach of contract claim regarding the IIP Agreements. (ECF No. 75). On June 10, 2014, the Court granted Plaintiff’s Motion, finding that Defendants breached their IIP Agreements.[3] (ECF No. 85). On June 29, 2015, Plaintiffs filed a Second Motion for Summary Judgment on the issue of damages related to Defendants’ breach.[4] (ECF No. 102). Specifically, Plaintiffs seek the return of all IIP payments made to Defendants. On July 16, 2015, Defendants filed a Response to the Motion. (ECF No. 103). On July 27, 2015, Plaintiffs filed a Reply. (ECF No. 104).

II. DISCUSSION

A. Standard of Review

Under Federal Rule of Civil Procedure 56, the Court must grant summary judgment if the moving party demonstrates there is no genuine issue as to any material fact, and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). In reviewing a motion for summary judgment, the Court views the facts in a light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) (citing Adickes v. S. H. Kress & Co., 398 U.S. 144, 157 (1970)). Once a motion for summary judgment is properly made and supported, the opposing party has the burden of showing that a genuine dispute exists. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986).

“[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson, 477 U.S. at 247-48. A “material fact” is one that might affect the outcome of a party’s case. Id. at 248; see also JKC Holding Co. v. Wash. Sports Ventures, Inc., 264 F.3d 459, 465 (4th Cir. 2001) (citing Hooven-Lewis v. Caldera, 249 F.3d 259, 265 (4th Cir. 2001)). Whether a fact is considered to be “material” is determined by the substantive law, and “[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Anderson, 477 U.S. at 248; accord Hooven-Lewis, 249 F.3d at 265.

B. Analysis[5]

1. Restitution/Rescission

Plaintiffs argue they are entitled to restitution and rescission due to Defendants’ material breach of their IIP Agreements. “Restitution . . . is referred to as an action for unjust enrichment.” Alts. Unlimited, Inc. v. New Balt. City Bd. of Sch. Comm’rs, 843 A.2d 252, 275 (Md.Ct.Spec.App. 2004) (quoting Mogavero v. Silverstein, 790 A.2d 43 (Md.Ct.Spec.App. 2002)). In Maryland, it is well settled that a claim for unjust enrichment may not be brought when an express contract exists between the parties governing the subject matter of the claim. Cty. Comm’rs of Caroline Cty. v. J. Roland Dashiell & Sons, Inc., 747 A.2d 600, 607 (Md. 2000) (quoting FLF, Inc. v. World Publ’ns, Inc., 999 F.Supp. 640, 642 ...


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