Foley v. Morgan Stanley Smith Barney, LLC
| Decision Date | 04 March 2013 |
| Docket Number | CASE NO. 0:11-cv-62476-WILLIAMS |
| Parties | RYAN H. FOLEY, Plaintiff, v. MORGAN STANLEY SMITH BARNEY, LLC, a Delaware limited Liability company, Defendant. MORGAN STANLEY SMITH BARNEY, LLC, and MORGAN STANLEY SMITH BARNEY FA NOTES HOLDINGS, LLC, Counter Plaintiffs, v. RYAN H. FOLEY, Counter Defendant. |
| Court | U.S. District Court — Southern District of Florida |
THIS MATTER is before the Court on Defendants Morgan Stanley Smith Barney, LLC and Morgan Stanley Smith Barney FA Notes Holdings, LLC's (together, "Morgan Stanley") Motion for Summary Judgment [D.E. 118], Plaintiff Ryan Foley's ("Foley") Response in opposition [D.E. 123] and Morgan Stanley's Reply [D.E. 126]. Having reviewed the pleadings and the record, the Motion is GRANTED. Morgan Stanley shall submit a proposed final judgment to Chambers by March 11, 2013.
Morgan Stanley removed this action from state court on November 18, 2011. [D.E. 1]. On February 24, 2012, Foley filed his Second Amended Complaint. [D.E. 23]. On September 25, 2012, Foley filed his Third Amended Complaint (the "Complaint") and dismissed Counts III-VI of his Second Amended Complaint with prejudice. [D.E. 99, 100]. The operative Complaint alleges discrimination under the Americans with Disabilities Act ("ADA") (Count I) and discrimination under the Florida Civil Rights Act of 1992 ("FCRA") (Count 2). [D.E. 99]. Morgan Stanley filed an Answer and Counterclaim, which alleges breach of a promissory note and unjust enrichment. [D.E. 104].
The Employment Agreement specified that Foley "would have access to information that has been acquired by expenditures of time, effort and money by Morgan Stanley, and which is valuable and proprietary information to Morgan Stanley" Id. ¶ 2.1. Such information specifically included "computer software or hardware for use in computer orword processing equipment," which were classified as "Trade Secrets." Id. Foley explicitly acknowledged that Morgan Stanley "takes all reasonable measures to maintain [the Trade Secret's] confidentiality and secrecy." [D.E. 118 ¶ 5]. Accordingly, Foley had access to confidential records and information during the course of his employment, (id. ¶ 6), and agreed that he would not "remove Trade Secrets or other Company Records from the premises of Morgan Stanley in either original or copied form, except in the ordinary course of conducting business for, and subject to approval by, Morgan Stanley." Id. ¶ 7.
Furthermore, Foley received and read Morgan Stanley's Employment Handbook and Code of Conduct. Id. ¶¶ 9-11. The Handbook required that each employee "protect the assets of the Firm," including its technology, software and business equipment. Id. ¶ 10. As Foley knew, the Code of Conduct allowed for his termination for any violation of the Handbook. Id. ¶ 11. He admitted that the Code required him to tell Morgan Stanley if: "(a) [Foley] believed he had violated any law, regulation or MSSB policy or if (b) [Foley] became aware of any client information being lost or stolen, including loss or theft of any portable devices." Id. Foley also concedes that removing a computer without permission was a violation of Morgan Stanley's policies and procedures. Id. ¶ 13.
On November 4, 2010, Foley removed the central processing unit (including the hard drive) of his office computer and took it from the premises. Id. ¶ 17; [D.E. 122 ¶ 17]. He took the computer to the home of a friend, who was not a Morgan Stanley employee, and left it there for six days. [D.E. 118 ¶ 22]. He does not deny that heremoved the unit, that he did not have permission to remove the computer,3 that the computer was Morgan Stanley's property and was considered to be a Trade Secret, and that such removal constituted a violation of Morgan Stanley's policies. Id. ¶¶ 18-21.
On November 5, 2010, Foley returned to Morgan Stanley and took a colleague's computer from that colleague's cubicle, which he placed in his office. Id. ¶ 22. Michelle Queen, Morgan Stanley's Complex Risk Officer, found out that Foley had taken his colleague's computer and tried to speak to him about it. Id. ¶ 24. Foley would not speak with her and left the office (he testified that, other than recalling that Queen asked him questions about the computer, he does not remember any other details about the conversation). Id. ¶ 24; [D.E. 122 ¶ 24].
Upon further investigation, Morgan Stanley realized that Foley's computer was not on premises; security camera footage showed him leaving the building on November 4, 2010, with his hard drive. [D.E. 118 ¶ 25, 27]. The situation was reported to Kevin McCarty, who was responsible for the hiring and firing of all personnel in the four Miami area Morgan Stanley offices. Id. ¶ 28. Thereafter, various Morgan Stanley employees attempted to contact Foley on November 5, 2010, to ascertain the location of the computer. Id. ¶ 29. At least one employee spoke to Foley that day and testified that Foley stated he did not have the computer and did not know where it was. Id. ¶ 31. Foley does not recall the conversations but disputes that he was intentionally untruthful during the conversation. [D.E. 122 ¶ 31]. Moreover, he does not dispute that the missing computer presented serious security concerns for Morgan Stanley because of Morgan Stanley's access to confidential and proprietary information. [D.E. 118 ¶ 26].
McCarty testified that the decision to terminate Foley was made on November 5, 2010. Id. ¶ 34. He stated that Morgan Stanley wanted to recover the computer from Foley before informing Foley of his termination because he believed the firm was more likely to retrieve the computer before Foley knew he was being fired. Id. ¶ 35. Consequently, Foley was put on paid administrative leave beginning November 5, 2010, while the investigation into the computer's whereabouts continued. Id. ¶ 37.
On the morning of November 10, 2010, Foley spoke again with Morgan Stanley representatives and told them that he did not take the computer. Id. ¶ 38. He testified during his deposition that he did not tell firm representatives where the computer was during that conversation because he did not remember taking it. [D.E. 122 ¶ 38]. Foley stated that later that same day, once he remembered where the computer was, he informed Morgan Stanley and went to his friend's home to pick up the computer. Id. ¶ 39. Morgan Stanley recovered the computer from Foley's home that afternoon. [D.E. 118 ¶ 40]. He was terminated later that same day. Id. ¶ 41. Foley admits that the reason he was terminated was because of the computer incident. Id. ¶ 43.
Foley alleges that he took the computer when he was in the midst of a psychotic episode (a manifestation of his bipolar disorder) and thought Morgan Stanley was spying on him through his computer. See [D.E. 122 ¶¶ 65-66]. He acknowledges that he never disclosed his disorder to Morgan Stanley before this incident and never requested an accommodation pursuant to the ADA prior to November 9, 2010, despite being given the opportunity to "self-identify" as disabled pursuant to Morgan Stanley's Non-Discrimination Policy. [D.E. 118 ¶¶ 16, 49-50]. The first time Morgan Stanley purportedly learned of Plaintiff's condition was on November 7, 2010, when Foley's wife,Kati, spoke with Rafael Alvarez, another Morgan Stanley Financial Advisor. Id. ¶ 47. Alvarez then emailed McCarty to tell him Plaintiff had been seen at South Miami Hospital and was being transferred to Hialeah Psychiatric Hospital for further evaluation. Id. ¶ 47. The email does not specifically mention bipolar disorder, and Morgan Stanley's position is that Kati Foley did not disclose the existence of that specific condition during her phone call. However, Ms. Foley asserts that she told Alvarez that Foley suffered from the disorder during the conversation. Id. ¶ 48. In any event, Foley's treating physician, Dr. Emilio Mantero-Atienza, testified that while it was possible Foley would have another manic phase, his bipolar disorder is in "full remission." [D.E. 122 ¶ 54].
Foley alleges that the decision to terminate him was not made until after McCarty received the email from Alvarez about his condition on November 7, 2010. Id. ¶ 67. The only documentary evidence on the subject is in the form of three emails between Morgan Stanley human resources personnel. The first, at 4:49 PM on Friday, November 5, 2010, placed Foley on paid administrative leave. [D.E. 122-7]. The second, at 3:37 PM on November 10, 2010, stated "FYI-we are planning to terminate Ryan Foley this afternoon." [D.E. 122-8]. The final email said Id. Foley testified that Alvarez told him if he returned the computer, Morgan Stanley would reinstate him to his position. Id. ¶ 72.
As part of his employment package, Foley and Morgan Stanley executed a Promissory Note, under which Morgan Stanley loaned Foley $2.2 million dollars at ayearly interest rate of 3.25%. [D.E. 118 ¶ 56]. The Note allowed that "Morgan Stanley shall declare this Note immediately due and payable, without notice...
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