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First Circuit Affirms Dismissal of Wrongful Termination Claims

The First Circuit has affirmed the district court's grant of summary judgment on a variety of wrongful termination claims brought by a sales representative against the printing company that fired him and the company's principal. The various claims include unjust enrichment, intentional interference with prospective contractual relations, oral contract, and intentional or negligent misrepresentation.

Plaintiff was a "veteran" sales representative specializing in the sale of commercial printing services. He worked on commission. One particular company was a substantial customer ("Customer") for decades while he represented different printing companies. While he represented a prior printer, plaintiff helped pay the car lease of an employee in the Customer's printing department. Customer subsequently learned of the apparent kickback while plaintiff was representing defendant. Customer decided it could no longer do business with plaintiff and reportedly told this to defendant. Defendant fired plaintiff.

Plaintiff sued in state court and defendants removed to federal court based on diversity. At the close of discovery, defendants moved for summary judgment. The district court granted the motion, Brisbano v. Strine Printing Co., No. 10-358, 2013 WL 1907455 (D.R.I. May 8, 2013). Plaintiff appealed.

The First Circuit discussed plaintiff's individual claims in an opinion authored by Judge Selya. (Thesaurus alert!). To recover for unjust enrichment, plaintiff must show he conferred a benefit on the defendant, the defendant knew of the benefit and appreciated it, and it would be unfair for the defendant to retain the benefit without paying for it. Plaintiff identified three benefits he allegedly conferred on the defendants, (1) he brought the Customer's print business to them, (2) he secured additional printing work from the Customer during his employment, and (3) he obtained preferred vendor status for defendant with Customer. The Court said that since plaintiff worked on commission, he was fully compensated for the first two benefits. Obtaining preferred vendor status was a prerequisite for bidding on the Customer's service. Thus, it was a normal part of a salesman's job while obtaining business on commission, not an additional benefit conferred on defendants.

To recover for intentional interference with prospective contractual relations, plaintiff must show (1) the existence of a business relationship or expectancy, (2) knowledge by the interferor of the relationship or expectancy, (3) an intentional act of interference, (4) the act of interference must be improper, (5) proof that the interference caused the harm sustained, and (6) damage to the plaintiff. Here, the existing contract was between the Customer and defendant, not plaintiff and Customer. Moreover, Customer terminated that contract before defendant terminated plaintiff.

The First Circuit also rejected plaintiff's claim that he had an oral employment contract with defendant that defendant breached by terminating him. When defendant hired plaintiff it gave him an employee handbook that he acknowledged in writing. The handbook said his "employment was at-will for an indefinite period." An "at-will" employment is terminable at the will of either party at any time for any reason or for no reason at all. None of the communications between plaintiff and defendant during his employment indicate any change in that status. At best, they provide "general expressions of job longevity." Given the notice set forth in the employee handbook, any reliance on these communications as changing plaintiff's employment status was neither reasonable nor actionable.

To recover for intentional misrepresentation, i.e., deceit, plaintiff must prove that defendant knowingly made a false statement, intending to deceive and induced plaintiff to rely upon it to his detriment. Negligent misrepresentation requires plaintiff prove defendant made an untrue statement of material fact that he knew or should have known was false, the defendant intended plaintiff to rely upon the untrue statement, plaintiff relied upon it and was harmed.

The First Circuit said none of defendant's emails were false. They simply said that so long as defendant kept getting the Customer's business, plaintiff would remain employed at defendant. It was not until Customer terminated its business with defendant that defendant terminated plaintiff. Also, plaintiff has not shown he would have done anything differently so he cannot establish he relied on these statements. Given that plaintiff was an "at-will" employee any such reliance would have been unreasonable. Finally, plaintiff has not shown how his purported reliance was detrimental to him.

Brisbano v Strine Printing Co., No. 13-1722, 2013 WL 6184067 (1st Cir. Nov. 27, 2013)

For information about our business and commercial litigation practice: http://www.sfandllaw.com/Practice-Areas/Business-Commercial-Litigation.shtml

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