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RAKOS v. SKYTEL CORP.

December 23, 1996

ALLAN W. RAKOS, Plaintiff,
v.
SKYTEL CORP., a Delaware corporation, Defendant.



The opinion of the court was delivered by: HOLDERMAN

 JAMES F. HOLDERMAN, District Judge:

 Plaintiff, Allan W. Rakos, filed a three count complaint against defendant, SkyTel Corp., alleging a breach of employment contract (Count I); a violation of the Illinois Wage Payment and Collection Act (Count II); and recovery of attorneys' fees under the Illinois Attorneys Fees In Wage Actions Act (Count III). Defendant has filed a motion for summary judgment on all three counts pursuant to Rule 56 of the Federal Rules of Civil Procedure. Plaintiff has also filed a motion for summary judgment on Count I pursuant to Rule 56 of the Federal Rules of Civil Procedure. For the following reasons, plaintiff's motion for summary judgment on Count I is DENIED and defendant's motion for summary judgment on all three counts is GRANTED.

 STATEMENT OF FACTS1

 Defendant, SkyTel Corp., is a corporation incorporated under the laws of the State of Delaware, with its principal place of business in Washington, D.C. Defendant sells various products and services related to wireless communications, including pagers and paging services. Plaintiff, Allan W. Rakos, is a former employee of defendant who formerly resided in Chicago, Illinois and now resides in Oregon. Defendant hired plaintiff on October 29, 1993 as a Major Account Executive (MAE) with a base annual salary of $ 40,000.00. Plaintiff was eligible for incentive compensation pursuant to an incentive compensation plan, the Major Account Executive Compensation Plan (Plan).

 Defendant does not negotiate the terms of its incentive plans with its employees. On January 10, 1994, plaintiff received a copy of the 1994 Plan and signed the Plan. Employees of defendant are not eligible to receive incentive compensation unless they acknowledge receiving the Plan. Plaintiff's manager met and discussed the Plan in great detail with plaintiff and other MAE's, followed by a question and answer period. Under the Plan, sales were credited to MAE's based on the net amount of new sales arising from the specific accounts to which the MAE's were assigned. In the Plan, however, management of defendant reserved the rights to change, modify, suspend, or discontinue the incentive plan at any time during the year without prior notice. It also stated that the Vice President of Sales could review unique large orders to determine, at his or her discretion, whether the order presented excessive credit in relation to the effort of the participant and that defendant could withhold part or all of the credit if such a determination was made. The Plan contained a provision that nothing in the Plan should be construed as a guarantee of employment for anyone for any fixed time. Plaintiff also signed a Confidentiality Agreement and a Non-Competition Agreement before he was hired.

 Sharon Smiley was hired by defendant as a national account manager on October 1, 1993. Two accounts specifically assigned to Smiley were Sears, Roebuck & Co. and Advantis. Advantis is a New York general partnership that acts as an agent for certain purposes on behalf of International Business Machines Corporation and Sears. Plaintiff was also assigned to the Advantis account in November 1993.

 Smiley had first solicited Advantis in October 1993, before plaintiff was hired by defendant. She previously had worked at a company where Advantis was a client and thus had prior dealings with people from Advantis. Plaintiff claims that he and Smiley began working on the Advantis account together in November 1993. Defendant disputes this and states that plaintiff is unable to identify one person at Advantis whom he contacted before attending an April 1994 meeting with Smiley. After several calls, Smiley arranged a meeting with Advantis representatives in April 1994 which plaintiff and Smiley attended to make a presentation on defendant's services. This was plaintiff's only face-to-face meeting with representatives of Advantis, although he claims to have spoken with representatives of Advantis on numerous other occasions. Plaintiff claims that Smiley did not keep him apprised of further meetings with Advantis or direct him to participate in responding to negotiations with Advantis, which unfairly excluded him from working on the sale. Defendant contends that plaintiff's only involvement with the Advantis sale was attending the one sales presentation with Smiley and objects to any implication that it had an obligation to keep plaintiff apprised of further meetings with Advantis, since plaintiff was merely one of several employees initially assigned to the account by defendant and it was not plaintiff's exclusive account.

 On April 20, 1994, George Taylor of Advantis sent Smiley a Request for Information (RFI) letter requesting information about defendant's pricing and stating that Advantis would need approximately 25,000 pagers. Advantis rejected defendant's first response to the RFI because the price offered was too high. Shortly thereafter, Raymond O'Brien, the Senior Vice President of Sales and Marketing for defendant, met with George Taylor at Advantis' Schaumburg, Illinois offices where he was told that defendant's pricing would have to be deeply discounted to get the Advantis contract. Defendant claims that following his meeting with Taylor, O'Brien believed that a sale to Advantis would be the result of competitive bidding since the RFI was sent to numerous paging companies, there was no longstanding relationship between anyone at Advantis and defendant, the price necessary to make a sale would have to be deeply discounted to an extent unprecedented at defendant, and the sale would be unlike normal sales in that it would have to involve defendant's top executives resulting in a truly company-wide effort and not the effort of just a few individual salespeople. Therefore, as they were leaving the meeting with Taylor, O'Brien informed Smiley and Bob Sabo, defendant's regional director of national accounts, that the Advantis sale, if it happened, would be taken off the compensation plans.

 Upon returning to Washington, D.C., O'Brien sent a memo to Bernard Puckett, president of MTel, defendant's parent company, and John Palmer, chairman of MTel, indicating the price needed to contend for the Advantis contract. Puckett approved the price and on June 2, 1994 O'Brien authorized Sabo and Smiley to convey the price to Advantis. O'Brien also reiterated in an e-mail message that the Advantis sale would be taken off the 1994 incentive compensation plans. He believed that the deep discount price given to Advantis would lead to employees receiving excessive bonuses in relation to the sale as calculated under the Plan. O'Brien did not inquire about the work performed specifically by plaintiff before determining that employees would not be paid according to the Plan for the Advantis sale. Defendant, however, disputes the implication that O'Brien did not know what work had been done to solicit the Advantis sale prior to his determination to take it off the Plan.

 An agreement was reached between defendant and Advantis on August 31, 1994 for the use of 20,859 pagers at $ 4.00 per month. Plaintiff participated in placing units with end users under the contract. Plaintiff was paid $ 83,436.00 for the Advantis sale. This payment was not calculated according to the Plan. In March 1995, plaintiff voluntarily resigned from defendant. At that time he was paid for all unused sick and vacation time.

 STANDARD OF REVIEW

 Under Rule 56(c), summary judgment is proper "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 a judgment as a matter of law." Fed. R. Civ. P. 56(c). In ruling on a motion for summary judgment, the evidence of the nonmovant must be believed and all justifiable inferences must be drawn in the nonmovant's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S. Ct. 2505, 2513, 91 L. Ed. 2d 202 (1986). This court's function is not to weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial.

 A party who bears the burden of proof on a particular issue, however, may not rest on its pleadings, but must affirmatively demonstrate, by specific factual allegations, that there is a genuine issue of material fact that requires trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986). There is no issue for trial "unless there is sufficient evidence favoring the ...


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