Kerstien v. McGraw-Hill Companies, Inc. , 7 F. App'x 868 ( 2001 )


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  •                                                                           F I L E D
    United States Court of Appeals
    Tenth Circuit
    UNITED STATES COURT OF APPEALS
    APR 4 2001
    FOR THE TENTH CIRCUIT
    PATRICK FISHER
    Clerk
    THOMAS L. KERSTIEN,
    Plaintiff-Appellant,
    v.                                                    No. 99-1095
    (D.C. No. 96-Z-1087)
    MCGRAW-HILL COMPANIES, INC.,                            (D. Colo.)
    a New York corporation; PAUL E.
    CLECKNER; HOWARD W. SMITH,
    Defendants-Appellees.
    ORDER AND JUDGMENT          *
    Before BRISCOE , ANDERSON , and MURPHY , Circuit Judges.
    After examining the briefs and appellate record, this panel has determined
    unanimously that oral argument would not materially assist the determination
    of this appeal.    See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
    therefore ordered submitted without oral argument.
    *
    This order and judgment is not binding precedent, except under the
    doctrines of law of the case, res judicata, and collateral estoppel. The court
    generally disfavors the citation of orders and judgments; nevertheless, an order
    and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
    Plaintiff initiated this action against the defendant corporation and two of
    its management employees following his termination as a vice president of
    North American sales for Compustat, a division of defendant McGraw-Hill.
    In his amended complaint, he alleged that his discharge constituted a breach of
    contract based on language in the employee handbook; that the discharge was
    wrongful based on the doctrine of promissory estoppel, also based on the
    handbook; that defendants breached an express covenant of good faith and fair
    dealing; that defendants breached certain assurances made to him,       violated the
    Colorado Wage Claim Act, and      intentionally interfered with contractual relations;
    that the individual defendants conspired to terminate plaintiff’s employment;      that
    all defendants caused plaintiff emotional distress by action constituting extreme
    and outrageous conduct; and that defendants violated both state and federal age
    discrimination statutes.
    The majority of the state law claims (wrongful discharge, intentional
    interference with contractual relations, civil conspiracy, and outrageous conduct),
    were dismissed on defendants’ motion for summary judgment.          The Colorado
    Wage Claims Act claim was resolved by the parties and subsequently dismissed
    with prejudice. Plaintiff voluntarily dismissed his state age discrimination claim,
    and, following a jury trial on the federal age discrimination claim, a verdict was
    entered in favor of defendants.
    -2-
    In this appeal, plaintiff contends there were genuine issues of material fact
    with respect to his claims of breach of contract and promissory estoppel, tortious
    interference with contractual relations, civil conspiracy, and outrageous conduct.
    See Appellant’s Br. at 1-2. He does not challenge the jury verdict on the federal
    age discrimination claim.
    Briefly, the underlying facts are as follows. Plaintiff was the vice president
    of North American sales with McGraw-Hill’s Compustat Division, a high-level
    executive position. Defendant Cleckner was the head of Compustat and defendant
    Smith was the vice president of sales and marketing. Smith was plaintiff’s
    immediate superior. In mid-1995, a Compustat sales employee, who reported to
    plaintiff, booked a sale to a sister company, an arrangement subsequently undone
    by either Cleckner or Smith, apparently because it violated company policies.
    The employee later contacted plaintiff asking why he was not receiving his
    anticipated sales commission and plaintiff made inquiry of Smith. Smith returned
    an explanation by voice mail.
    Plaintiff prepared a voice mail response to the sales employee, which also
    forwarded Smith’s voice mail to the employee. The comments plaintiff added to
    Smith’s voice mail (which plaintiff admitted were intemperate and defendants
    claimed were insubordinate and divisive) were also forwarded (no doubt
    inadvertently) to Smith.
    -3-
    Smith and Cleckner decided the comments made by plaintiff to the sales
    employee were insubordinate, undermined Smith’s authority, and had
    misrepresented the events in question. They met with Diane Gunter of the
    human resources department and a representative of the legal department.
    Smith, Cleckner, and Gunter discussed the matter with corporate headquarters.
    Termination was discussed as an option.
    Plaintiff was called into Smith’s office at 9 a.m., Monday, August 21, 1995,
    at which time the voice mail message was played for plaintiff. Gunter was
    present at the time. Plaintiff apologized and admitted he had made a mistake.
    According to plaintiff, he was given the choice of resigning immediately or being
    placed on “final warning,” which stated in part that any further action “such as
    attempting to undermine management, displaying a condescending attitude,
    making negative statements or behaving in a manner detrimental to McGraw-Hill
    as determined by [Smith ]” would result in immediate dismissal. Appellees’ Supp.
    App. at 23 (emphasis added). Plaintiff was told to leave the office and to stay
    home to consider his decision.
    Plaintiff admits to being told by both Gunter and Cleckner that he could not
    take a previously scheduled trip to Chicago. Although he had decided by the
    following day that he would accept the final warning, he knew he needed Smith’s
    and Cleckner’s permission to be reinstated and left a message telling Smith and
    -4-
    Cleckner of his decision. Cleckner later responded, accepting plaintiff’s decision
    to remain on the job under the final warning and stating he wished to meet with
    plaintiff the following Monday, August 28. Plaintiff subsequently admitted that
    the only reference to the Chicago trip he had ever heard from Cleckner was on
    August 21 and that the communication was not to go.
    Nevertheless, plaintiff went to Chicago on Wednesday, August 23, and
    returned August 24. While there he “met with a Compustat salesperson and made
    several calls on Compustat business.” Appellant’s Opening Br. at 12. Plaintiff
    subsequently informed Smith and Cleckner he had been in Chicago, although
    Gunter apparently already knew. Cleckner sent plaintiff a voice mail expressing
    incredulity at plaintiff’s decision to make the trip and calling the action “blatant
    insubordination.” Appellant’s App. at 210. The message further advised plaintiff
    that he had disobeyed a direct order of his boss (Smith), the general manager
    (Cleckner), and human resources (Gunter).            Id. Following a meeting on
    Monday, August 28, prior to which Cleckner, Smith, and Gunter had again
    discussed the situation with corporate headquarters, plaintiff was terminated
    for insubordination.
    We review the district court’s grant of summary judgment de novo, using
    the same standard as did the district court.         See Scull v. New Mexico , 
    236 F.3d 588
    , 595 (10th Cir. 2000). Summary judgment is appropriate if the movant
    -5-
    establishes 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).
    Under this standard, “we examine the factual record and reasonable inferences
    therefrom in the light most favorable to the party opposing summary judgment.”
    Kaul v. Stephan , 
    83 F.3d 1208
    , 1212 (10th Cir. 1996) (further quotation omitted).
    A fact is material if, under the substantive law, it could affect the outcome of the
    action, and an issue is genuine if a rational juror could, on the evidence presented,
    find in favor of the nonmoving party.   See Adams v. Am. Guarantee & Liab. Ins.
    Co. , 
    233 F.3d 1242
    , 1246 (10th Cir. 2000) (citation omitted).
    The district court held as a matter of law that McGraw-Hill’s procedures
    manual contained a clear disclaimer barring claims based on the manual.    1
    The third paragraph of the second page of the manual reads as follows:
    This manual is given to you for your information and guidance.
    It does not represent a contract with employees, and it is not meant
    to impose any legal obligation upon them or McGraw-Hill.
    McGraw-Hill may amend or terminate at any time the policies, plans,
    and benefits described in this manual as our business needs and
    experience dictate. Any changes will supersede the contents of this
    manual. Updates to this manual will be issued when necessary to
    describe any changes in the policies or plans.
    Appellant’s App. at 213.
    1
    These claims included the wrongful discharge issues of breach of contract
    and promissory estoppel.
    -6-
    The district court was correct in its ruling that “[w]hether a contract
    disclaimer in a handbook is conspicuous is a matter of law.”       Durtsche v. Am.
    Colloid Co. , 
    958 F.2d 1007
    , 1010 (10th Cir. 1992). In addition, “[s]ummary
    judgment denying claims based on a handbook is appropriate if the employer
    has clearly and conspicuously disclaimed intent to enter a contract limiting
    the right to discharge employees.”      Ferrera v. Nielsen , 
    799 P.2d 458
    , 461
    (Colo. App. 1990).
    The cases relied on by plaintiff for his contract and promissory estoppel
    claims are inapposite. In   Cronk v. Intermountain Rural Electric Ass’n     , 
    765 P.2d 619
    , 623 (Colo. App. 1988), although the employment manual had a disclaimer,
    it not only set forth express events which might be cause for termination, but also
    listed other reasons as grounds for termination “‘as long as such legitimate
    reasons constitute just cause.’”     Moreover, the disclaimer itself was added after
    the plaintiff had commenced employment.        2
    See 
    id.
     In Allabashi v. Lincoln
    National Sales Corp. of Colorado-Wyoming           , 
    824 P.2d 1
    , 2-3 (Colo. App. 1991),
    notwithstanding a handbook disclaimer providing that employees were hired
    “‘for no fixed period of time’ and that employment ‘may by terminated by the
    2
    We further note that a subsequent unpublished opinion recited that the
    disclaimer conflicted with the just cause provisions, see Cronk v. Intermountain
    Rural Elec. Ass’n , No. 90CA0666, 
    1992 WL 161811
    , at *2 (Colo. App. Apr. 2,
    1992), and that the Cronk disclaimer was “inconspicuously placed in appendix to
    the handbook.” Ferrera , 
    799 P. 2d at 461
    .
    -7-
    employee or the Company at will,’” the other documents given to employees
    contained procedures and policies requiring just cause for termination and
    providing for specific procedures to be followed in the event of a dismissal.
    Finally, in Evenson v. Colorado Farm Bureau Mutual Insurance Co.         ,
    
    879 P.2d 402
    , 409 (Colo. App. 1993), the court found that a question of fact
    existed as to whether the company’s disciplinary procedures were treated as
    mandatory and binding, thus supporting plaintiff’s claim of breach of an implied
    employment contract. The court also held that the disclaimer provisions, which
    stated that the employee handbook was not intended to create or be construed as
    a contract, were not conspicuous.     
    Id.
     However, unlike Evenson , in which the
    court held that “an employer may nevertheless be found to have manifested an
    intent to be bound by its terms if the manual contains mandatory termination
    procedures or requires ‘just cause’ for termination,”   
    id.
     , the manual in question
    here states only that the company’s basic policy is to resort to dismissal only
    where there is reasonable cause. Appellant’s App. at 187. Nonetheless,
    a statement that is merely a description of policy does not constitute a promise
    or commitment by an employer.       See George v. Ute Water Conservancy Dist.       ,
    
    950 P.2d 1195
    , 1199 (Colo. App. 1997). Thus as noted by the district court,
    these cases are all factually distinguishable.
    -8-
    Plaintiff’s theory of promissory estoppel based on the manual must also
    fail. To establish such a theory, he must show
    that (1) the employer should reasonably have expected the employee
    to consider the employee manual as a commitment from the employer
    to follow policies contained in the manual, (2) the employee
    reasonably relied on the termination procedures to his detriment,
    and (3) that injustice can be avoided only by enforcement of the
    termination procedures.
    Vasey v. Martin Marietta Corp.   , 
    29 F.3d 1460
    , 1466 (10th Cir. 1994) (citing
    Continental Air Lines, Inc. v. Keenan   , 
    731 P.2d 708
    , 712 (Colo. 1987)).
    The manual provisions covering termination provided that McGraw-Hill’s
    basic policy is to dismiss or demote an employee “    only where there is reasonable
    cause , as determined in the judgment of management and Human Resources.”
    Appellant’s App. at 187 (emphasis in original). This language, however, clearly
    establishes the right of management to terminate an employee under the
    circumstances presented here, particularly in view of the express provision in the
    final warning that any further action as determined by defendant Smith to be
    detrimental to McGraw-Hill, as determined by defendant Smith, would result
    in plaintiff’s immediate dismissal. Plaintiff has failed to demonstrate that
    McGraw-Hill should have reasonably expected him to consider the policy as
    a commitment, that he relied on the manual’s statement to his detriment or that
    injustice can be avoided only by enforcement of the policy.    See Bullington v.
    United Air Lines, Inc. , 
    186 F.3d 1301
    , 1322 (10th Cir. 1999).
    -9-
    Plaintiff also relies on the “assurances” he claims he received on August 21
    that he was suspended pending the resolution of whether he would resign or
    accept the final warning as a condition of continued employment. He further
    states that he relied on Gunter’s alleged statement--that if he accepted the final
    warning he would be back on the job--for his decision to travel to Chicago.
    Assuming for purposes of the summary judgment motion that these statements
    were made, they do not alter the at-will nature of plaintiff’s employment.
    Plaintiff admitted he knew he needed permission to go to Chicago and that
    permission had been expressly denied on three different occasions. Nothing in
    the alleged assurances altered that denial or his ultimate termination for traveling
    to Chicago in contravention of the final warning.
    Also as part of his breach of contract claim, plaintiff claims defendants
    breached an express covenant of good faith and fair dealing, relying on      Decker v.
    Browning-Ferris Industries of Colorado, Inc.      , 
    931 P.2d 436
     (Colo. 1997).
    In Decker , the Colorado Supreme Court recognized that such a covenant could
    become a term of an employment agreement.         Id. at 443. Insofar as plaintiff
    alleges that such a covenant is stated in the company’s policy manual, we have
    previously determined that the manual did not create a contractual obligation.
    Where “the evidence discloses only a ‘vague assurance,’ rather than
    a legally enforceable promise, then the court must determine the issue as a matter
    -10-
    of law.” Soderlun v. Public Serv. Co. of Colo.      , 
    944 P.2d 616
    , 621 (Colo. App.
    1997) (quoting Vasey , 
    29 F.3d at 1465
    ). Moreover, a covenant of good faith and
    fair dealing does not “inject new substantive terms into a contract or change its
    existing terms.”   Id. at 623. “Such a covenant, therefore, cannot limit an
    employer’s right to discharge without cause, unless there is an express or implied
    promise, independent of the covenant of good faith itself, restricting that right.”
    Id. The oral assurances made by Gunter (that if he accepted the final warning he
    would be “back on the job”) and the deposition testimony of Smith (that he had
    told those who reported to him it was his policy to treat people fairly) and
    Cleckner (“we say we want to treat people fairly”) are not sufficiently definite as
    a matter of law to support the breach of contract claims.      See Vasey , 
    29 F.3d at 1465
    ; Dupree v. United Parcel Serv., Inc.      , 
    956 F.2d 219
    , 222-23 (10th Cir.
    1992) (statement that “‘We Treat our People Fairly and Without Favoritism’”
    not specific enough to create implied contract; likewise oral assurances too
    vague to create implied contract);   see also Valdez v. Cantor , 
    994 P.2d 483
    , 487
    (Colo. App. 1999) (questioning whether general statement by employer that
    employee will be treated fairly would be sufficient to support judicially
    enforceable obligation);   Hoyt v. Target Stores , 
    981 P.2d 188
    , 194 (Colo. App.
    1998) (trial court erred in denying motion for directed verdict on good faith and
    -11-
    fair dealing claim where basis was vague assurance of fair and consistent
    treatment). The district court correctly determined that this claim must fail.
    Next, plaintiff contends genuine issues of material fact exist as to his claim
    against Smith and Cleckner for tortious interference with his contract with
    McGraw-Hill. We disagree. Under Colorado law
    One who intentionally and improperly interferes with the
    performance of a contract (except a contract to marry) between
    another and a third person by inducing or otherwise causing the third
    person not to perform the contract, is subject to liability to the other
    for the pecuniary loss resulting to the other from the failure of the
    third person to perform the contract.
    Trimble v. City & County of Denver   , 
    697 P.2d 716
    , 726 (Colo. 1985) (citations
    omitted).
    As we have earlier stated, plaintiff did not have a contract with
    McGraw-Hill. “To defeat the presumption of ‘at will’ employment in Colorado,
    [a plaintiff] must demonstrate an express stipulation as to the duration of
    employment in exchange for consideration over and above [his] existing
    performance.” Davies v. Philip Morris, USA , 
    863 F. Supp. 1430
    , 1440 (D. Colo.
    1994) (further quotation omitted). Because the employment manual did not create
    a contract, plaintiff remained at all times an at will employee. “In Colorado,
    employment is generally at-will and an employer may terminate an employee
    without cause and without notice.”   Decker v. Browning-Ferris Indus. of Colo.,
    Inc. , 
    947 P.2d 937
    , 939 (Colo. 1997) (further quotation omitted).
    -12-
    Moreover, this claim required employer interference with a contractual
    relationship. There is simply no showing that Smith and Cleckner were motivated
    solely by a desire to induce McGraw-Hill to breach any contract with plaintiff or
    to interfere in any contractual relationship between McGraw-Hill and plaintiff.
    See Meehan v. Amax Oil & Gas, Inc. , 
    796 F. Supp. 461
    , 465 (D. Colo. 1992).
    Plaintiff concedes he was told that the basis for his termination was his
    insubordination. Appellant’s Br. at 23. His argument that the termination
    “was so unreasonable that the only possible motivation was personal malice,”
    see id. at 24, is pure speculation.
    Plaintiff’s claim for civil conspiracy is also without a legal basis. In order
    to establish a case of civil conspiracy, Colorado law requires “(1) action of two or
    more persons; (2) common object to be accomplished; (3) meeting of the minds
    on the object or course of action; (4) one or more unlawful acts; and (5) damages
    as a proximate result thereof.”      White v. Lincoln Plating Co. , 
    955 F. Supp. 98
    ,
    101 (D. Colo. 1997) (citing       Pittman v. Larson Distrib. Co.   , 
    724 P.2d 1379
    ,
    1389-90 (Colo. App. 1986)). However, a corporation and its employees do
    not constitute the requisite two or more persons if the employees are acting
    “on behalf of the corporation and not as individuals for their individual
    advantage.” Pittman , 
    724 P.2d at 1390
    . Plaintiff has failed to establish that
    Smith and Cleckner acted for their individual advantage as alleged in his amended
    -13-
    complaint. The district court correctly entered summary judgment for defendants
    on this claim.
    Finally, the district court granted summary judgment on plaintiff’s claim of
    outrageous conduct. Plaintiff has failed to demonstrate any facts showing that
    defendants’ conduct was outrageous. To be liable for the intentional infliction of
    emotional distress (outrageous conduct under Colorado common law), defendants’
    conduct “must be more than unreasonable, unkind or unfair; it must truly offend
    community notions of acceptable conduct.”          Grandchamp v. United Air Lines,
    Inc. , 
    854 F.2d 381
    , 383 (10th Cir. 1988). There is simply no evidence that the
    actions taken by defendants rose to the level of “‘atrocious and utterly intolerable’
    conduct required for an outrageous conduct claim.”        Wilcott v. Matlack, Inc. , 
    64 F.3d 1458
    , 1465 (10th Cir. 1995) (quoting      Rugg v. McCarty , 
    476 P.2d 753
    , 756
    (Colo. 1970)).
    AFFIRMED.
    Entered for the Court
    Mary Beck Briscoe
    Circuit Judge
    -14-
    

Document Info

Docket Number: 99-1095

Citation Numbers: 7 F. App'x 868

Judges: Anderson, Briscoe, Murphy

Filed Date: 4/4/2001

Precedential Status: Non-Precedential

Modified Date: 8/3/2023

Authorities (19)

Adams v. America Guarantee & Liability Insurance , 233 F.3d 1242 ( 2000 )

Patrick Vasey v. Martin Marietta Corporation, a Maryland ... , 29 F.3d 1460 ( 1994 )

Myron Durtsche, Jr. v. American Colloid Company , 958 F.2d 1007 ( 1992 )

Reed v. State of New Mexico , 236 F.3d 588 ( 2000 )

Terry Thomas Dupree Jerry Dupree v. United Parcel Service, ... , 956 F.2d 219 ( 1992 )

Harold W. GRANDCHAMP and Peter J. Seewald, Plaintiffs-... , 854 F.2d 381 ( 1988 )

White v. Lincoln Plating Co. , 955 F. Supp. 98 ( 1997 )

Cronk v. Intermountain Rural Electric Ass'n , 765 P.2d 619 ( 1988 )

Allabashi v. Lincoln National Sales Corp. of Colorado-... , 824 P.2d 1 ( 1991 )

Kathy L. Kaul v. Robert T. Stephan, Attorney General , 83 F.3d 1208 ( 1996 )

Bullington v. United Air Lines, Inc. , 186 F.3d 1301 ( 1999 )

willis-h-wilcott-and-v-matlack-inc-doing-business-as-matlack-systems , 64 F.3d 1458 ( 1995 )

Davies v. Philip Morris, USA , 863 F. Supp. 1430 ( 1994 )

Meehan v. Amax Oil & Gas, Inc. , 796 F. Supp. 461 ( 1992 )

Pittman v. Larson Distributing Co. , 724 P.2d 1379 ( 1986 )

Valdez v. Cantor , 994 P.2d 483 ( 1999 )

Soderlun v. Public Service Company , 944 P.2d 616 ( 1997 )

George v. Ute Water Conservancy Dist. , 950 P.2d 1195 ( 1997 )

Ferrera v. Nielsen , 799 P.2d 458 ( 1990 )

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