LaScola v. U.S. Sprint Communications
| Decision Date | 24 October 1991 |
| Docket Number | No. 90-2505,90-2505 |
| Citation | 946 F.2d 559 |
| Parties | 120 Lab.Cas. P 56,756 Frank LaSCOLA, Plaintiff-Appellant, v. US SPRINT COMMUNICATIONS, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Lawrence M. Cohen (argued), Jeffrey S. Goldman, Allison Blakley, Paul A. Olsen, Paul R. Gary, Fox & Grove, Chicago, Ill., for plaintiff-appellant.
Gregory J. Schroedter (argued), Jeffrey A. Blevins, Charles G. Albert, Bell, Boyd & Lloyd, Chicago, Ill., Bernard A. Bianchino, Kansas City, Mo., for defendant-appellee.
Before WOOD, Jr., CUDAHY and EASTERBROOK, Circuit Judges.
Plaintiff-appellant Frank LaScola brought this diversity action against defendant-appellee US Sprint Communications Company ("US Sprint"), alleging breach of contract, fraud, and violation of the duty of good faith and fair dealing by US Sprint. US Sprint moved for summary judgment, and the district court granted US Sprint's motion. LaScola appeals the district court's decision, and we now consider the propriety of that decision.
US Sprint is a partnership engaged in the business of selling long distance telephone services, data transmission services, video teleconferencing services, and other telecommunications services. US Sprint emerged in 1986 as the successor in interest to a company called ISACOMM and its corporate parent US Telecom.
In 1984, LaScola worked for American Satellite as a telecommunications sales executive. That year, he entered into discussions with ISACOMM employees about working for ISACOMM. Executives of ISACOMM told LaScola that ISACOMM was an excellent company comprised of "a bunch of straight shooters"; that the company offered a lucrative compensation plan; and that LaScola would receive the commissions due upon sale of an account. ISACOMM offered LaScola the position of sales executive, which he accepted. He began work on June 1, 1984, and worked for ISACOMM for over two years. 1 After ISACOMM and its parent corporation, US Telecom, created a national fiberoptic network--US Sprint 2--LaScola became an employee of US Sprint. He remained in the same job position, with the same salary and responsibilities.
During his employment, LaScola received a salary, as well as commissions pursuant to written compensation plans. The compensation plans for Senior National Account Managers, which LaScola signed, provided for payment of commissions in two installments: part of the sales commission would be paid when the sale was made and the purchase order received by US Sprint, and part would be paid when the service was installed. 3
Beginning in late 1984 and early 1985, ISACOMM established contact with Sears, Roebuck & Company ("Sears") to discuss the possibility of making a telecommunications services deal. A division of Sears, the Sears Communications Network ("SCN"), was responsible for the handling In July 1986, SCN executed an agreement to purchase telecommunications services from US Telecom/US Sprint in a Bulk Services Agreement ("BSA"). The BSA provided for purchase of US Sprint telecommunications services by Sears over a specified period of time (or pilot period) at a total contract value of $78 million. 4 SCN requested that this business relationship be kept highly confidential, and US Telecom/US Sprint agreed. After the execution of the BSA, in early August 1986, Nelson assigned LaScola to the Sears account exclusively and removed him from his other accounts. LaScola received standard commissions for his sales of telecommunications products and services to Sears.
of Sears's communications services. LaScola served as account manager for Sears's accounts in the Chicago area, and therefore played a significant role in negotiations with SCN.
In September 1986, US Sprint began efforts to design and sell services to Electronic Data Services ("EDS"), the telecommunications section of General Motors ("GM"). Because of the significance of this potential transaction, US Sprint and GM/EDS decided to maintain strict confidentiality regarding the negotiations.
On September 30, 1986, LaScola traveled to Atlanta, Georgia, for a meeting with representatives of US Sprint and SCN. LaScola and two US Sprint employees from the West Coast marketing region met for dinner at Chequers Bar & Grill, a public restaurant near the hotel in which LaScola was staying. During the dinner in the crowded restaurant, LaScola and his dinner companions mentioned both the GM/EDS account and the Sears account. US Sprint executives also dining at Chequers testified that they overheard LaScola mention the GM/EDS and Sears accounts.
Two of the executives reported to Richard Smith, president of US Sprint's National Accounts division, how they had overheard LaScola in this breach of confidentiality. David Dorman, vice president of that division, also was informed about the incident and Smith instructed Dorman to explore the situation. Eventually it was determined that LaScola should be discharged from his position at US Sprint. On October 8, 1986, Mary Elzy, director of US Sprint's Human Resources, and Nelson met with LaScola in Chicago. They discussed with him how the US Sprint executives had heard him discussing confidential company information. Elzy and Nelson then told LaScola that he was being terminated from US Sprint.
Before the October 31, 1986, effective date of the termination, LaScola appealed the termination decision internally. On November 5, 1986, US Sprint rescinded the discharge decision and offered to reinstate LaScola to the position he held when discharged. US Sprint informed LaScola that in the reinstated position he would not retain the Sears account. 5
LaScola denies disclosure of confidential information. Instead, he contends that US Sprint terminated his employment because it did not want to pay him the considerable commissions to which he claims he would have been entitled from the Sears account ($600,000).
ANALYSIS
SUMMARY JUDGMENT
It is well-established that "we review de novo a district court's decision to grant a motion for summary judgment and apply the same standard as that employed by the district court." DeBruyne v. Equitable Life Assurance Soc., 920 F.2d 457, 463 (7th Cir.1990). The burden is on the movant to show "that there is no genuine issue of material fact and that he is entitled to judgment as a matter of law," and "[a]ny doubt as to the existence of a genuine issue for trial is resolved against the moving party." New Burnham Prairie Homes, Inc. v. Village of Burnham, 910 F.2d 1474, 1477 (7th Cir.1990).
As we noted recently, "although we view the evidence and all reasonable inferences that can be drawn from it in the nonmovant's favor, it is not enough for the nonmovant merely to raise factual arguments that cast 'some metaphysical doubt as to the material facts.' " Baker v. Elmwood Distributing, Inc., 940 F.2d 1013, 1017 (7th Cir.1991) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1355-56, 89 L.Ed.2d 538 (1986)). The nonmovant "has the burden of presenting specific facts to show that there is a genuine issue of material fact." New Burnham, 910 F.2d at 1477. That is, "that the record contains a bona fide, bipolar dispute as to some dispositive factual issue 'that properly can be resolved only by a finder of fact.' " Baker, at 1017 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986)). With these factors in mind, we review LaScola's claims.
Breach of Employment Contract
In Count V of the first amended complaint, LaScola contended that US Sprint breached its employment contract with him by firing him without the "just cause" LaScola claims was necessary. The district court granted summary judgment for US Sprint on this count because it determined that LaScola, who was admittedly employed for an indefinite period, was an employee-at-will and could be terminated at will, without cause.
A general rule in the employment relationship context is "that an employment relationship without a fixed duration is terminable at will by either party." Duldulao v. St. Mary of Nazareth Hosp. Ctr., 115 Ill.2d 482, 489, 106 Ill.Dec. 8, 15, 505 N.E.2d 314, 317 (1987). 6 Duldulao does point out, however, that most courts, including the Illinois Supreme Court, "interpret the general 'employment-at-will rule' as a rule of construction, mandating only a presumption that a hiring without a fixed term is at will, a presumption which can be overcome by demonstrating that the parties contracted otherwise." Id. at 489, 106 Ill.Dec. at 16, 505 N.E.2d at 318. In an employment contract with no definite duration, there are three exceptions to the rule LaScola argues that his situation falls within the third exception. 7 He maintains that the statements made in soliciting him to work for US Sprint established a policy and practice of treating...
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