Hendricks v. Smartvideo Technologies, Inc.

• Decision Date: 26 January 2007
• Docket Number: Case No. 3:06-cv-224-J-33MMH.
• Parties: Wilson W. HENDRICKS, III, Plaintiff, v. SMARTVIDEO TECHNOLOGIES, INC., a Delaware corporation, Defendant.
• Court: U.S. District Court — Middle District of Florida

Page 1219

511 F.Supp.2d 1219

Wilson W. HENDRICKS, III, Plaintiff, v. SMARTVIDEO TECHNOLOGIES, INC., a Delaware corporation, Defendant.

Case No. 3:06-cv-224-J-33MMH.

United States District Court, M.D. Florida, Jacksonville Division.

January 26, 2007.

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Charles David Hood, Jr., Jonathan R. Williams, Smith, Hood, Perkins, Loucks, Stout Bigman, Lane & Brock, P.A., Daytona Beach, FL, for Plaintiff.

Jeffrey D. Mokotoff, Yoon J. Kim, Ford & Harrison LLP, Atlanta, GA, John Edmund Duvall, Ford & Harrison LLP, Jacksonville, FL, for Defendant.

ORDER

VIRGINIA M. HERNANDEZCOVINGTON, District Judge.

This cause comes before the Court pursuant to Smartvideo's Motion for Summary Judgment (Doc. # 44), filed on November 1, 2006; Hendricks' Cross-motion for Summary Judgment (Doc. # 53), filed on November 17, 2006; Smartvideo's Motion for Sanctions (Doc. # 58), filed on November 29, 2006; and Hendricks' Cross Motion for Sanctions (Doc. # 67), filed on December 18, 2006. Responses were filed as to each motion, Doc. ## 52, 60, 65, 68, respectively. For the reasons stated below, the Court denies both motions for sanctions, denies in part and grants in part Smartvideo's motion for summary judgment, and denies Hendricks' cross-motion for summary judgment

I. Facts

Smartvideo, a Georgia-based corporation, is in the business of cellular-based video distribution. (Doc. # 44 at 3.) Smartvideo was founded by Richard Bennet and Robert Walters in January 2000.(Id.) Smartvideo employed Hendricks as Smartvideo's Vice President of Operations between April 1, 2005, and October 28, 2005. (Id. at 2.)

Though Hendricks did not begin working for Smartvideo until 2005, the relationship between Smartvideo and Hendricks began much earlier. The relationship began when Rick Turbin, an outside representative of Smartvideo, introduced Hendricks to Roger Dunavant, Smartvideo's Director of New Business Development. (Id. at 4.) At the time, Hendricks worked for a company called BearingPoint. (Id.) Smartvideo believed that Bearing-Point wanted to jointly develop products to sell to BearingPoint's clients. (Id.) In furtherance of this venture, Hendricks visited Smartvideo. (Id.) Smartvideo contends that during this visit Hendricks provided Smartvideo a resume, printed on Bearing-Point letterhead, indicating that Hendricks held a Bachelor's degree from the University of Florida. (Id.) Smartvideo also contends that Hendricks orally represented that he graduated from the University of Florida. (Id.) BearingPoint and Smartvideo did not ultimately enter into a business partnership. (Doc. # 44 at 4.)

Subsequently, Smartvideo decided to hire a Vice President of Operations. Smartvideo represents that, to fill this position, Smartvideo desired an individual with a minimum of fifteen years experience in the telecommunications industry, a bachelor's degree or higher, and professional contacts within the telecommunications industry. (Id. at 5.) Dunavant informed Turbin of the opening. (Id.) In turn, Turbin informed Hendricks. (Id.) Hendricks contacted Dunavant regarding the position. (Id.)

Dunavant recommended to Bennet that Smartvideo hire Hendricks. (Doc. # 44 at 7.) In February 2005, Bennet interviewed Hendricks. (Id.) Subsequent to the interview, Bennet offered Hendricks the Vice President of Operations position. (Id. at 8.) On March 8, 2005, Bennet emailed Hendricks an employment proposal and an employment agreement. The employment proposal provided, in part:

As an inducement to join [Smartvideo], [Smartvideo] will grant you 1,000,000 non-qualified Incentive Stock Options of Smartvideo Technologies, Inc. Common Stock in accordance with its plan. The options shall vest over a two year period, with 500, 000 vesting upon your reporting for duty, 250,000 vesting on your first anniversary, and 250,000 vesting on you [sic] second anniversary. The options will have a strike price of $2.25 and may be exercised on a cashless basis.

(Id.)(citing Doc. # 43-2 at 18-19, Ex. 4-6). The employment proposal also included provisions providing that the employment was at-will and that Hendricks could indicate that the conditions were acceptable by signing and dating the proposal.

On April 1, 2005, Hendricks assumed the position of Vice President of Operations for Smartvideo. (Id. at 9.) In the course of Hendricks' employment, Smartvideo became engaged in a proxy fight with Forte Capital, an investment group with members owning Smartvideo stock. (Id. at 11.) Smartvideo suspected Hendricks and another Smartvideo employee, Gene Carter, of leaking information to Forte. (Id.) Based on this suspicion, Smartvideo terminated Hendricks, by letter dated October 28, 2005. (Id. at 13.) Smartvideo also terminated Carter. (Id.)

Hendricks' complaint alleges multiple counts, including (1) Promissory Estoppel; (2) Fraudulent Inducement; (3) Specific Performance;¹ (4) Breach of Oral Contract. (Doc. # 2.) Smartvideo filed a counterclaim, claiming fraudulent inducement. (Doc. # 50.) Smartvideo requests Summary Judgment as to each count of Hendricks' complaint and Smartvideo's counterclaim. Hendricks requests summary judgment on Smartvideo's counterclaim.

II. STANDARD OF REVIEW

Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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." Fed.R.Civ.P. 56(c). A factual dispute alone is not enough to defeat a properly pled motion for summary judgment; only the existence of a genuine issue of material fact will preclude a grant of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

An issue is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir.1996)(citing Hairston v. Gainesville Sun Publ'g Co., 9 F.3d 913, 918 (11th Cir.1993)). A fact is material if it may affect the outcome of the suit under the governing law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir.1997). The moving party bears the initial burden of showing the court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial. Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260 (11th Cir.2004)(citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). "When a moving party has discharged its burden, the nonmoving party must then `go beyond the pleadings,' and by its own affidavits, or by `depositions, answers to interrogatories, and admissions on file,' designate specific facts showing that there is a genuine issue for trial." Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593-94 (11th Cir.1995)(citing Celotex, 477 U.S. at 324, 106 S.Ct. 2548).

If there is a conflict between the parties' allegations or evidence, the nonmoving party's evidence is presumed to be true and all reasonable inferences must be drawn in the non-moving party's favor. Shotz v. City of Plantation, Fla., 344 F.3d 1161, 1164 (11th Cir.2003). If a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, the court should not grant summary judgment. Samples ex rel. Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir.1988)(citing Augusta Iron & Steel Works, Inc. v. Employers Ins. of Wausau, 835 F.2d 855, 856 (11th Cir.1988)). However, if the nonmovant's response consists of nothing "more than a repetition of his conclusional allegations," summary judgment is not only proper, but required. Morris v. Ross, 663 F.2d 1032, 1034 (11th Cir.1981), cert. denied, 456 U.S. 1010, 102 S.Ct. 2303, 73 L.Ed.2d 1306 (1982).

III. Analysis

A. Choice of Law

Smartvideo contends that, as to each count, Georgia law governs. In its response, "[Hendricks] concedes that it is a close question as to whether Georgia or Florida law applies." (Doc. # 52 at 2.) For the reasons stated below, the Court finds that Georgia law governs each claim.

This is a diversity action. In diversity cases, the Court applies the substantive law of the forum, Florida, including Florida's choice of law rules. Erie R.R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938); Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487; 61 S.Ct. 1020, 85 L.Ed. 1477 (1941).

In Acme Circus Operating Co. v. Kuperstock, 711 F.2d 1538 (11th Cir.1983), the Eleventh Circuit provided the following three step approach to a choice of law analysis:

The first step in choice of law analysis is to ascertain the nature of the problem involved, i.e. is the specific issue at hand a problem of the law of contracts, torts, property, etc. The second step is to determine what choice of law rule the state of [Florida] applies to that type of legal issue. The third step is to apply the proper choice of law rule to the instant facts and thereby conclude which state's substantive law applies.

Id. at 1540.

As noted, Hendricks has filed a fourcount complaint and Smartvideo has filed a counterclaim. Among the four counts and counterclaim, there are both contract and tort claims. Thus, the nature of the problem is both tort and contract.

With the nature of the problem established, the Court next determines the choice of law rule that Florida applies. In the contract context, for purposes of determining whether a valid contract was formed, Florida adheres to the lex loci contractus doctrine. Trumpet Vine Invs., N.V. v. Union Capital Partners I, 92 F.3d 1110, 1119 (11th Cir.1996). As to torts, "Florida applies the significant relationship test of the Restatement (Second) of Conflicts of Laws." Nelson v. Freightliner, LLC, 154 Fed.Appx. 98 (11th...