Neibert v. Computer Sciences Corp., 073115 FED11, 14-12679

Docket Nº:14-12679
Opinion Judge:PER CURIAM
Party Name:JOSEPH KYLE NEIBERT, Plaintiff - Counter Defendant-Appellant, v. COMPUTER SCIENCES CORPORATION, Defendant -Counter Claimant -Appellee.
Judge Panel:Before MARCUS and ROSENBAUM, Circuit Judges, and FRIEDMAN, District Judge. FRIEDMAN, District Judge, concurs in the judgment only.
Case Date:July 31, 2015
Court:United States Courts of Appeals, Court of Appeals for the Eleventh Circuit

JOSEPH KYLE NEIBERT, Plaintiff - Counter Defendant-Appellant,


COMPUTER SCIENCES CORPORATION, Defendant -Counter Claimant -Appellee.

No. 14-12679

United States Court of Appeals, Eleventh Circuit

July 31, 2015


Appeal from the United States District Court for the Northern District of Georgia D.C. Docket No. 1:12-cv-02277-SCJ

Before MARCUS and ROSENBAUM, Circuit Judges, and FRIEDMAN, [*] District Judge.


Joseph Kyle Neibert appeals from the district court's grant of final summary judgment to Computer Sciences Corporation ("CSC") on his breach of contract claim. Neibert, a former CSC salesperson, alleges that CSC breached the terms of his compensation plan when it gave him a smaller incentive payment than he allegedly deserved for his role in securing a deal to provide mainframe hosting services to the Federal Home Loan Mortage Corporation, otherwise known as Freddie Mac. This case comes down to a question of contractual interpretation: does Neibert's compensation plan, which encompasses "[a]ll cloud and hosting services, " necessarily include a mainframe hosting transaction? After thorough review, we conclude that the answer is no. The contract expressly gives CSC discretion to interpret its terms. Neibert has failed to present any evidence that CSC did not act in good faith when CSC interpreted this ambiguous phrase to exclude mainframe transactions. We, therefore, affirm the district court's grant of summary judgment to CSC.


The essential facts, viewed in the light most favorable to Neibert, are these. CSC is a "global information technology services company" which offers data hosting services to businesses worldwide. CSC provides "mainframe" hosting services, which involve dedicated physical servers stored in a data center. These data centers can range in size from a small room to many floors of an office building, and are managed by on-site information technology personnel. CSC also provides "cloud" hosting services, which involve storing data over networks that can be accessed anywhere.

Mainframe and cloud hosting services differ in several crucial respects. Mainframe services are generally perceived as more secure and reliable, and companies dealing with sensitive information often prefer a mainframe solution. In contrast, cloud services are cheaper, based on newer technology, and allow easier access to information. In recognition of these differences, CSC divides its sales personnel into two units. The Cloud Computing and Software Services unit ("Cloud Services") is tasked with selling cloud products. Cloud Services employs only "some folks" with experience in mainframe transactions, and does not typically sell mainframe services. Mainframe services are instead sold by the Infrastructure Services business unit, which contains personnel with expertise in that field. Cloud Services employees and Infrastructure Services employees are governed by distinct incentive plans because the two kinds of transactions involve different amounts of revenue and expenses and varying employee time commitments.

In spring 2011, the appellant, Neibert, was offered a position as a Specialist Sales Executive in CSC's Cloud Services division. "In recognition" of his "sales role, " Neibert was offered a compensation plan: the CSC Sales Incentive Compensation Agreement ("Compensation Plan"). The Compensation Plan provides that Neibert could earn an incentive payment by securing contracts for certain "Offerings and Services, " defined as "[a]ll cloud and hosting services, " within his geographic territory. However, Section 5.1 of the Compensation Plan stipulates that "CSC has complete discretion and final authority to administer and interpret this Plan and to resolve any disputes concerning its administration or interpretation." The Compensation Plan also contains two other relevant provisions: a choice of law clause which instructs that the Compensation Plan shall be governed by Virginia law, and a severability clause in the event any provision of the Compensation Plan is found to be unenforceable.

Throughout the course of his employment, Neibert managed several active cloud services accounts involving Freddie Mac. In May or June of 2011, a Freddie Mac representative approached Neibert about the possibility of CSC hosting Freddie Mac's mainframe. This opportunity involved CSC taking over Freddie Mac's existing data center, including mainframe hardware, the people charged with running it, and even the facility itself. A transaction of this kind would not normally be handled by the Cloud Services division, and, during his deposition, Neibert could remember only one other occasion when Cloud Services personnel managed a mainframe outsourcing deal. Indeed, Neibert admitted that such a transaction was "not a [c]loud deal." Neibert presented the Freddie Mac mainframe transaction to CSC management, and was allegedly told that he would be compensated for pursuing it. CSC and Freddie Mac eventually reached an agreement regarding the hosting of Freddie Mac's mainframe on November 18, 2011, to the tune of over $30 million.

After the Freddie Mac deal closed, CSC conducted its sales credit review process, which determines how much credit each particular sales professional should receive for a given deal. CSC management concluded that the Freddie Mac mainframe transaction fell outside of Neibert's Compensation Plan, but that he nonetheless deserved special recognition for his contributions to the deal. Neibert was ultimately awarded $25, 000, based on the payment he would have received under the incentive plan in place for the Infrastructure Services unit. He was, obviously, unhappy with that figure, and contends that he was instead entitled to $609, 632.63 under his Compensation Plan. Neibert resigned, and eventually, filed this lawsuit.


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