111 F. Supp. 3d 494
S.D.N.Y.2015Background
- O’Grady sues Blue-Crest for bonus and severance under his 2013 employment agreement.
- Agreement states bonus awards are discretionary and that no bonus is paid if employment has been terminated before payment.
- BlueCrest terminated O’Grady without cause on June 4, 2014; O’Grady seeks $1,305,485 (bonus plus severance).
- O’Grady also asserts quasi-contract claims and a NY Labor Law §193 wage claim.
- BlueCrest moves to dismiss under Rule 12(b)(6), arguing contract unambiguous disclaims bonus/severance and wage claim fails.
- Court applies NY law and concludes the contract plain terms bar claims and quasi-contract theories are duplicative.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the bonus claim is barred by discretionary language | O’Grady argues Guidelines modify the contract to mandate a bonus. | BlueCrest contends §3 makes bonuses discretionary and not guaranteed. | Yes; bonus claim barred by plain discretionary language. |
| Whether severance is payable absent a signed release | O’Grady alleges BlueCrest prevented him from signing a release to obtain severance. | Severance requires a signed release; no release alleged or produced. | No severance; condition precedent not satisfied. |
| Whether the quasi-contract claims survive given the express contract | Quasi-contract theories independently recoverable. | Express contract governs; quasi-contract claims duplicative and precluded. | Duplicative; dismissed. |
| Whether NY Labor Law §193 wage claim survives | Bonus may be wages if earned. | Discretionary bonus not a wage; §193 does not apply. | Dismissed; discretionary bonus not wage under §193. |
Key Cases Cited
- Namad v. Salomon Inc., 74 N.Y.2d 751 (N.Y. 1989) (discretion in bonus provision defeats breach claim)
- Truelove v. Northeast Capital & Advisory, Inc., 95 N.Y.2d 220 (N.Y. 2000) (bonuses discretionary under contract bar contract claim)
- Clark-Fitzpatrick, Inc. v. Long Island R.R. Co., 70 N.Y.2d 382 (N.Y. 1987) (written contract precludes quasi-contract relief)
- City of Yonkers v. Otis Elevator Co., 844 F.2d 42 (2d Cir. 1988) (quasi-contract relief unavailable when express contract covers matter)
- Hall v. United Parcel Service, 76 N.Y.2d 27 (N.Y. 1990) (bonus eligibility determined by terms of the plan; discretion applies)
- Hunter v. Deutsche Bank AG, 56 A.D.3d 274 (1st Dep't 2008) (bonuses explicitly discretionary; not enforceable as wages)