Dreni v. PrinterOn America Corporation

Background

Denis Dreni sued his former employer, PrinterOn America Corporation, seeking unpaid commissions under an employment agreement and related commission plans. The agreement was governed by New York law. Dreni alleged that PrinterOn failed to pay commissions on various accounts, including commissions connected to maintenance-related revenue. He also asserted claims under New York Labor Law §§ 193 and 198 and for breach of the implied covenant of good faith and fair dealing.

PrinterOn asserted counterclaims based mainly on Dreni’s retention of two company laptops after his termination and his failure to sign a release that PrinterOn sent after paying him severance. The parties each moved for summary judgment, which is a decision without a trial when the court finds no genuine dispute over facts that could affect the result.

PrinterOn’s Motion

Release and severance-payment issues. PrinterOn argued that Dreni released all of his claims by accepting a severance payment, even though he did not sign the release. PrinterOn alternatively argued that Dreni breached the employment agreement by failing to sign the release.

The court denied summary judgment on both issues. It found factual disputes about whether the severance payment exceeded what Dreni was owed, an issue that depended in part on the unresolved commission claims. The court also found that the employment agreement did not clearly state that merely keeping the severance payment would release Dreni’s claims. Whether the parties intended acceptance of the payment to have that effect therefore could not be resolved on summary judgment.

Docomo commissions. PrinterOn sought summary judgment on Dreni’s claim for commissions related to a $1 million Docomo pre-payment. The court denied PrinterOn’s statute-of-limitations defense because the contracts were unclear about whether commission entitlement arose when PrinterOn invoiced a customer or when PrinterOn received payment. That dispute affected whether the claim was timely.

On the merits, however, the court granted summary judgment to PrinterOn on Dreni’s Docomo commission claim. Although the 2013 commission plan listed Docomo among Dreni’s responsibilities, the court found that the relevant contract language and the evidence of the parties’ understanding showed no genuine factual dispute: the parties intended to exclude the $1 million Docomo pre-payment from Dreni’s commission calculations.

New York Labor Law claims. The court granted PrinterOn summary judgment on Dreni’s claims under New York Labor Law §§ 193 and 198. Section 193 addresses unlawful deductions from wages, while section 198 provides remedies for certain violations. The court held that Dreni alleged only a failure to pay commissions, not a targeted deduction or docking of wages. Because Dreni did not establish a violation under section 193, section 198 could not independently support his claim. Count Two of the complaint was dismissed.

Implied covenant of good faith and fair dealing. The court denied summary judgment on this claim. Dreni alleged that PrinterOn reassigned accounts or revenue, delayed invoices, and terminated him to avoid paying commissions. The court held that these allegations were distinct from the express breach-of-contract claim and that the record supported a factual inference that PrinterOn might have acted to deprive Dreni of the benefits of his bargain. Whether PrinterOn acted in bad faith was therefore left for the factfinder.

Dreni’s Motion

Maintenance-renewal commissions. Dreni sought summary judgment on his claim for commissions on maintenance-related revenue. PrinterOn argued that the commission plans covered new maintenance contracts but not renewals of existing maintenance contracts.

The court denied Dreni’s motion because the contract language was ambiguous. Some language could include maintenance renewals, while the reference to “net new revenue” could exclude them. The parties also offered conflicting evidence about whether maintenance renewals had previously generated commissions. Whether Dreni was entitled to maintenance-renewal commissions therefore remained a factual issue.

Computer Fraud and Abuse Act counterclaim. Dreni sought summary judgment on PrinterOn’s counterclaim under the Computer Fraud and Abuse Act, a federal statute that can provide a civil claim for certain unauthorized computer access causing qualifying damage or loss. The statute required PrinterOn to show at least $5,000 in qualifying loss.

The court assumed that $3,131.52 in professional services and some storage costs could qualify as losses related to forensic examination of the laptops. But it excluded storage costs incurred after the forensic indexing because PrinterOn said those costs were needed to preserve the laptops’ litigation chain of custody. After subtracting $500 in later storage costs, the claimed loss was $4,881.51, below the statutory threshold. The court therefore granted summary judgment to Dreni on the counterclaim and dismissed PrinterOn’s First Counterclaim.

Disposition

PrinterOn’s motion for summary judgment was granted in part and denied in part. It was denied as to Dreni’s alleged release of claims, PrinterOn’s severance-payment breach-of-contract counterclaim, the statute-of-limitations defense to the Docomo claim, and Dreni’s good-faith and fair-dealing claim. It was granted as to Dreni’s Docomo commission claim and his New York Labor Law claims.

Dreni’s motion for partial summary judgment was denied as to maintenance-renewal commissions and granted as to PrinterOn’s computer-fraud counterclaim. The court scheduled a final pretrial conference, and the opinion states that the unresolved issues would proceed further.