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Petronzi v. Computer Sciences Corp.

United States District Court, D. New Jersey

April 2, 2018

JOHN PETRONZI, Plaintiff,
v.
COMPUTER SCIENCES CORPORATION and SCOTT WARKENTIN Defendants.

          MEMORANDUM AND ORDER

          PETER G. SHERIDAN, U.S.D.J.

         This matter comes before the Court on Defendants Computer Sciences Corporation and Scott Warkentin's Motion for Summary Judgment (ECF No. 34). In his Complaint, Plaintiff John Petronzi alleges that Defendants wrongfully terminated him due to his age, disability, and filing a grievance, in violation of the New Jersey Law Against Discrimination (LAD), N.J.S.A. § 10:5-1. He also claims that Warkentin violated the LAD by aiding and abetting this unlawful conduct. Lastly, Plaintiffs Complaint alleges claims of breach of contract and breach of the covenant of good faith and fair dealing, based on an incentive program initiated by Computer Sciences. For the reasons discussed herein, Defendants' Motion for Summary Judgment is granted in part and denied in part.

         Background

         Computer Sciences is a global provider of information technology and offers professional services and solutions to corporate clients. (Defs' Statement of Material Facts [DSOMF] at ¶ 2). In July 2007, Plaintiff, who is now 68 years old, was hired as an at-will employee by Computer Sciences. (Id. at ¶¶ 9-10). For the bulk of his tenure at Computer Sciences, Plaintiff served as a Client Relationship Executive (hereinafter, "CRE") in the Financial Services Group, which later became the Banking & Capital Markets Industry Group. (Id. at ¶ 11). As a CRE, Plaintiff was responsible for managing and growing the revenue and profits of various client accounts. Essentially, Plaintiff was a sales person. (Id. at ¶¶ 12-13). In order to generate revenue, Computer Sciences assigned Plaintiff, as well as other CREs, a certain quota for account revenue and new contract signings, which the company referred to as Total Contract Value (hereinafter, "Sales Quota"). (Id. at ¶ 13).

         As a sales professional, Plaintiff was eligible to participate in Computer Science's "Sales Incentive Compensation Plan" (hereinafter, "Incentive Plan"), which awarded bonuses to sales employees who exceeded certain goals. (Id. at ¶ 103). Under the Incentive Plan, each participant had an individual Plan Assignment Agreement which described the participant's "territory" and "services", and the credit that each participant would receive towards his or her bonus. (Id. at ¶ 107). If an account was not identified in the participant's Plan Assignment Agreement, he or she would not receive credit for work performed on it. (Id. at ¶ 109). Under Sections 7.1 and 7.2 of the Incentive Plan, Computer Sciences reserved itself with discretion on how to interpret and execute the incentive plan:

7.1 [Computer Sciences] has complete discretion and final authority to administer and interpret this Plan and to resolve any disputes concerning its administration or interpretation.
7.2 [Computer Sciences] reserves the right to assign or reassign Opportunities at any time among [Incentive Plan] Participants as business conditions warrant. In the event the [Incentive Plan] Participant is reassigned from an Opportunity prior to a Contract Award, [Computer Sciences] may, in its discretion, grant partial or total quota credit to the [Incentive Plan] Participants to reflect his/her contribution to such Contract Award.

(ECF No. 34-19, "Incentive Plan" at 6).

         In August 2013, Computer Sciences rolled out a new incentive program, the Million Dollar Challenge, that offered bonuses for employees that surpassed certain goals on accounts listed in the Plan Assignment Agreement. (Id. at ¶ 114). Later that month, Computer Sciences emailed all eligible participants about this new incentive, which stated that eligible employees who "achieve $1M (million) in [fiscal year 2014] revenue above the full-year forecast" are eligible for $15, 000 for the first $1 million in revenue and an additional 1.5% bonus for every additional dollar above the initial million. (ECF No. 34-24, "Million Dollar Challenge Email").

         During this period, UBS, one of Plaintiff s accounts, exceeded forecasted revenues for that Fiscal Year, which would have entitled participants in the account, such as Plaintiff, to a potential bonus. (Id. at ¶ 115). However, because the UBS account was "seriously underperforming, " no CRE received the Million Dollar Challenge incentive on the UBS account. (Id. at ¶ 116). According to Computer Sciences, executive leadership cited the UBS account team's history of underperforming, the account's substantial net negative revenue, and major customer satisfaction issues, as reasons for declining to award the incentive. (Id. at ¶¶ 116-18).

         On January 19, 2014, Plaintiff suffered a heart attack and did not attend work for about seven business days. (Id. at ¶¶ 85-86). However, Plaintiff did not experience any lingering health issues or restrictions as a result, nor did he apply for disability benefits thereafter. (Id. at ¶¶ 86, 88). This being said, at 65 years old, Plaintiff claims that Computer Sciences made a series of employment decisions and account reassignments to Plaintiffs detriment, to ultimately justify his termination the following year.

         In April 2014, Plaintiff was removed from the UBS account and reassigned four "New Logo" accounts, which are new accounts with companies that had not previously conducted business with Computer Sciences. (Pi's Statement of Material Facts [PSOMF] at ¶¶ 39, 47-48). According to Computer Sciences, Plaintiff was removed from the UBS account due to a "lack of results, " despite the fact that the account had surpassed revenue projections the year before. (Id. at ¶ 40). Rather than appoint another CRE to the UBS account, Computer Sciences eliminated the CRE role altogether and, instead, assigned Tamara Kostova to serve as the global manager of the account. (DSMOF at ¶ 33). At the time, Kostova was 38 years old, 27 years younger than Plaintiff. (PSMOF at ¶45).

         That same month, Defendant Scott Warkentin was hired by Computer Sciences to oversee operation the Banking & Capital Markets Group. (Id. at ¶¶ 44-45). As part of his hiring, Warkentin was responsible for reorganizing the group, improving the overall performance of the firm, and increasing sales and revenue. (Id. at ¶ 46). Specifically, Warkentin assessed the performances of Computer Sciences' sales employees, including Plaintiff. (Id. at ¶¶ 47-48).

         The parties disagree about Plaintiffs performance. According to Defendants, Plaintiff was not performing up to expectations; with the exception of UBS, Plaintiff failed to generate revenue on any of his other accounts. (Id. at ¶ 25). As such, John Wallace, Plaintiffs former supervisor, noted in his assessment of Plaintiff that "[he] needed to prove himself within 90 days." (Id. at ¶ 49). Plaintiff, however, relies on Wallace's Fiscal Year 2014 Performance Appraisal of Plaintiff, which purportedly expressed positive views of Plaintiff s performance. (ECF No. 45-5 at 36-43, "FY 2014 Appraisal"). In this appraisal, Wallace noted that, "[Plaintiff] worked diligently and effectively to sustain the relationship with UBS despite significant headwinds caused by [Computer Science's] delivery performance issues and with underlying contract issues." (Id. at 3). However, in his overall appraisal comments, Wallace also acknowledged that Plaintiff did not generate much revenue besides his UBS account; as such, Wallace concluded:

[Plaintiffs] #1 objective in FY2015 is to leverage the foundation of executive relationships he built and strengthened in FY2014. He must executive [sic] against a series of well thought out account plans and opportunity development and close plans to deliver substantial new business results to meet or exceed his targets and make material contributions to the Banking and Capital Markets Industry business.

(Id. at 8).

         Nevertheless, as part of the Banking & Capital Markets Groups' reorganization, Warkentin began reassigning CRE employees to new account teams. (DSOMF at ¶¶ 51-52). In August 2014, Plaintiff was placed on Warkentin's team, where he was seven years older than the next oldest CRE. (PSOMF at ¶ 52). As a member of Warkentin's team, Plaintiff was assigned 70 new logo accounts; the remaining CREs, however, were assigned significantly fewer accounts, the next closest being 38 new logo accounts. (Id. at ¶¶ 52, 57). In an August 6, 2014 email, Warkentin addressed his new team and explained that the new account assignments had a retroactive start of the second quarter, July 1, 2014. (Id. at¶ 51; ECFNo 34-33, "August 6, 2014 Email"). The email also noted that Plaintiff and Tim Tolls, another CRE, would be assigned the majority of new logo clients. (Id.). According to Computer Sciences, Plaintiff was assigned these new logo accounts since he was removed from UBS and, therefore, "had the bandwidth to take on the new assignment." (Id. at ¶¶ 57-58). In deposition, Wallace explained why he believed Plaintiff would be suited for new logo accounts:

The new logo accounts, many of the new logo accounts [Plaintiff] was assigned have businesses that are very similar and in some cases almost the same, as the businesses that UBS is in or the business that RBS Citizens is in or the business that Credit Suisse is in. So, he has the requisite domain expertise and experience.
In addition, the quote/unquote Wall Street client is one whereby, for example, a CTO that he knew well from UBS moved and became the infrastructure CIO at Morgan Stanley and he had other relationships, for example, at Morgan Stanley which is why we made the decision to assign Morgan Stanley to him. That's the logic and decision-making Scott and I went through.

(ECF No. 34-31, "Wallace Deposition" at 99-100). Computer Sciences also viewed this reassignment as an opportunity for Plaintiff to generate greater sales revenue, since these new accounts each had "potential." (Id. at ¶ 61).

         Plaintiff, however, viewed the new assignment as a demotion. (PSOMF at ¶¶ 55-56). From his perspective, "despite his track record of success handling established accounts, he was now being assigned the time-consuming task of developing 70 different [n]ew [l]ogo accounts." (Id. at ¶ 55). Moreover, according to Plaintiff, he was the only CRE on Warkentin's team to be assigned exclusively new logo accounts. (Id. at ¶ 56).

         Despite this reassignment, Computer Sciences claims Plaintiffs work performance continued to decline. (DSOMF at ¶¶ 64-65). By late November 2014, Plaintiff had only achieved $2.57 million, or 9%, of his annual Sales Quota for the 2015 Fiscal Year; as such, Warkentin scheduled a meeting with Plaintiff, to discuss his mid-year review and performance concerns. (Id. at ¶¶ 64-67). Dissatisfied with his performance, Warkentin explained to Plaintiff that he would need to reach a Sales Quota of at least $ 10 million by the end of the third quarter or risk termination. (Id. at ¶¶ 68-69). Put another way, Warkentin expected Plaintiff to realize earnings of $7.5 million in less than one month. According to Plaintiff, to develop a new logo account takes anywhere from twelve to eighteen months; so for Warkentin to impose a quota that quadrupled his revenue in a single quarter was simply impossible. (PSOMF at ¶¶ 57, 61, 67). In addition, Plaintiff was told that his FY 2015 Sales Quota had increased from $12 million to $36 million. (Id. at ¶ 74). No other CRE's Sales Quota tripled during that time. (Id. at ¶ 76).

         Two weeks, later, on December 4, 2014, Plaintiff emailed Warkentin, regarding his midyear review. (Id. at ¶ 70). In this email, Plaintiff expressed to Warkentin that he felt the negative review was unfair and that "[t]he only explanation that makes any sense is that [Computer Sciences] is trying to force me out of the Company because of my age (65) and recent health condition to make room for younger employees." (Id.). In response, Warkentin directed Plaintiff to bring these allegations to the Employee Relations (ER) Department's attention. (Id. at ¶ 71). The following day, December 5, 2014, Plaintiff forwarded his email communications with Warkentin to the ER Department, which initiated an internal investigation of the complaint. (Id. at ¶¶ 72-73). Following the investigation, an ER Specialist concluded that Plaintiffs claims were unsubstantiated. (Id. at ¶ 74). After speaking with management and other witnesses, the Specialist prepared a Summary Report of Investigation (hereinafter, "SRI"), which concluded:

Regarding Age Discrimination: [the Specialist] has found that the actions taken by Mr. Warkentin as well as other members of management ... to be fair and consistent regarding the ages, the gender, and the documented production of each member of their sales team....
Mr. Petronzi claimed he was being replaced by a "38 year old woman with no experience." [The Specialist] found that an account Mr. Petronzi was previously on was given to a female employee, 38 years old, but with substantial experience. [The Specialist] has concluded that the hiring of this employee was o[f] merit and not related to her age or gender.
Regarding Health Discrimination: At no point during any of the conversations with Mr. Warkintin [sic] or any other management was Mr. Petronzi's health mentioned as being a factor in their decision-making. The focus of the decisions were strictly numbers (past production and sales that were in the pipeline.) When [the Specialist] mentioned the idea of Mr. Petronzi's heart condition playing a role in their decisionmaking process, the reactions by Mr. Warkentin and other management were of confusion and shock. [The Specialist] felt their reactions were genuine.
Additionally, Mr. Petronzi did not produce any documentation to back up this claim.

(ECF No. 45-6 at 28, "SRI"). A week after submitting this grievance, Warkentin requested permission from ER to terminate Plaintiffs employment. ...


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