Beard v. International Business Machines Corporation
- William Alsup
- 3:18-cv-06783
- U.S. District Court · Northern District of California
- 2
In Beard v. International Business Machines, Judge Alsup denied Beard’s motion because a factual dispute remained over whether IBM’s plan letter was a contract.
Jerome Beard and International Business Machines Corporation; the ruling left unresolved whether IBM’s incentive plan letter was a contract and therefore did not grant Beard judgment on his Unfair Competition Law claim.
What happened
Beard v. International Business Machines Corporation concerns compensation for Jerome Beard, an IBM software sales representative. Beard alleged that IBM did not pay him all the commissions he earned under his 2017 compensation plan after two large sales.
Beard asked the court to rule for him on the pleadings on his claim under California’s Unfair Competition Law. IBM had previously obtained an order granting in part and denying in part its motion to dismiss Beard’s claims.
The court denied Beard’s motion for judgment on the pleadings because a material factual dispute remained about whether IBM’s incentive plan letter was a contract. Judge William Alsup issued the order.
The detailed version
- Beard v. International Business Machines Corporation · No. 3:18-cv-06783
- William Alsup
- Dec. 20, 2019
Background
Jerome Beard had worked as a software sales representative at International Business Machines Corporation since 1983. IBM paid him a salary and uncapped commissions. IBM assigned him a revenue target and connected his commission compensation to the percentage of that target he reached.
In July 2017, IBM gave Beard an incentive plan letter describing his commission plan for the remainder of 2017 and setting a $934,736 sales quota. Beard also reviewed a presentation that repeatedly said payments under the compensation plan would be uncapped. The presentation described the incentive plan letter as the primary 2017 educational material for IBM sales employees and said it contained the information employees needed to understand the plan.
Beard alleged that two large 2017 deals produced $25.2 million in revenue subject to commission. He claimed he earned $2,901,806 in commissions, but IBM refused to pay the full amount because it was too much money to pay.
Beard’s complaint asserted claims under California Labor Code Sections 2751 and 221, California’s Unfair Competition Law, race discrimination, unjust enrichment, fraudulent misrepresentation, and negligent misrepresentation. An earlier order granted in part and denied in part IBM’s motion to dismiss. Beard then moved for judgment on the pleadings on his Unfair Competition Law claim.
Legal standard and analysis
Judgment on the pleadings is appropriate when no material fact is disputed and the moving party is entitled to judgment as a matter of law. The court stated that California Labor Code Section 2751 applied even though Beard began working for IBM before the statute took effect. The court nevertheless found a material factual dispute about whether the incentive plan letter was a contract.
Disposition
The court denied Beard’s motion for judgment on the pleadings. The order did not resolve the factual dispute about the legal status of the incentive plan letter.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.