Atkinson v. International Technegroup, Inc.

666 N.E.2d 257, 106 Ohio App. 3d 349, 1995 Ohio App. LEXIS 3933, 68 Fair Empl. Prac. Cas. (BNA) 1562
CourtOhio Court of Appeals
DecidedSeptember 13, 1995
DocketNo. C-930694.
StatusPublished
Cited by73 cases

This text of 666 N.E.2d 257 (Atkinson v. International Technegroup, Inc.) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Atkinson v. International Technegroup, Inc., 666 N.E.2d 257, 106 Ohio App. 3d 349, 1995 Ohio App. LEXIS 3933, 68 Fair Empl. Prac. Cas. (BNA) 1562 (Ohio Ct. App. 1995).

Opinion

Hildebrandt, Judge.

Defendant-appellant, International Technegroup, Inc. (“ITI”), appeals from a judgment of the Hamilton County Court of Common Pleas in favor of plaintiffappellee, Andrews Atkinson, in the amount of $447,844.55 on appellee’s claims for age discrimination and breach of an express or implied employment agreement. We affirm the trial court’s judgment.

ITI is a consulting and service group which develops and supplies computer software to business clients for manufacturing applications. In February 1989, appellee, who was then fifty-five years of age, began working at ITI as an independent contractor. Pursuant to a written consulting agreement, appellee’s duties were to sell ITI’s products and services on commission. The agreement provided that appellee would receive six percent of the amount of ITI products he sold and fifty percent of the consulting revenue he produced. Additionally, he would receive a ten thousand dollar bonus plus eight percent of revenue upon obtaining the first five hundred thousand dollars of sales of ITI’s products and services.

ITI is divided into several separate entrepreneurial divisions, each of which is responsible for marketing individual ITI products and services. Appellee was first assigned to the IGES group, ITI’s largest and most profitable division. *355 Within two months, appellee had sold $240,000 of IGES software. On March 6, 1989, Edward Carl, ITI’s vice president of sales, notified appellee in writing that he was amending the consulting agreement to reflect that appellee would receive six percent of all new account revenue. However, Carl made no mention of the $10,000 bonus and appellee claimed that he retained the right to earn the bonus when he generated $500,000 of sales in a fiscal year.

Effective July 1, 1989, appellee was transferred to ITI’s Integrated Manufacturing Engineering Group (“IME”), which was managed by thirty-six-year-old Scott Leckie. Because at that time IME had no products, appellee sold consulting services concerning automation of manufacturing processes. ITI was compensated on an hourly basis for these consulting services.

According to appellee, Carl agreed to allow appellee to become an employee of ITI to compensate for appellee’s lost revenue due to not selling IGES products. Although appellee became eligible for employee benefits such as health insurance, he continued to be compensated solely on a commission basis.

During appellee’s tenure with IME, the division began a search of the industry for a product it could sell. Through this search, ITI discovered that the Fanuc division of the General Electric Company (“GE”) possessed a computer software program, GE-CAPP, which allowed a computer to assist in the manufacturing of a product. This software was attractive because it already had an established user base. Appellee testified that he and Leckie worked together to acquire this program from GE. In mid-1990, ITI purchased GE-CAPP from GE for $2,000,-000 and renamed it CAPP/MD.

Appellee began to demonstrate CAPP/MD to potential customers. Additionally, appellee continued to service the existing customers of the program. In the first year after ITI’s purchase of CAPP-MD, appellee sold projects at a price of $100,000 each to several companies.

However, CAPP-MD was not without competition. One of ITI’s competitors, Prime Computer Division, owned a similar, although more flexible, computer software program called MULTICAPP. In June 1991, ITI acquired MULTI-CAPP from Prime Computer Division at no cost because Prime Computer chose to divest itself of the product. In February 1991, ITI hired Richard Franzosa to sell MULTICAPP for the IME division. Franzosa, who was in his late thirties, had previously sold MULTICAPP for Prime Computer. Unlike appellee, Franzosa received a salary of approximately $80,000 per year. Franzosa was also entitled to participate in various ITI stock plans.

While Franzosa and Leckie devoted all of their efforts to marketing MULTI-CAPP, appellee continued to market CAPP/MD. Appellee testified that it was his philosophy to form a partnership with his sales clients so that they would *356 remain prospects for continued sales. This philosophy was consistent with the marketing strategy of ITI’s chairman of the board, Jack Lemon. Lemon testified that “consultative selling,” continually servicing the client so as to garner consulting work and additional sales over the long run, was very important to ITI and that he had instructed Leckie to pursue this sales philosophy.

The IME division under Leckie’s management was not showing a profit. For the fiscal year ending June 30, 1991, IME lost $123,742, in contrast to ITI as a whole, which showed a profit. Had it not been for the losses generated by MULTICAPP, IME would have shown a profit of $6,000 for that period. In the meantime, appellee sold his clients $544,000 in CAPP/MD services for the fiscal year ending June 30, 1991. By October 31, 1991, appellee had generated more than $800,000 in revenues.

Because he had achieved more than $500,000 in sales for the fiscal year 1991, appellee asked Leckie about payment of the $10,000 bonus that appellee believed he had earned pursuant to the consulting agreement. Leckie responded that he wpuld have to check with his superiors. Leckie later informed appellee that ITI was not going to pay him the bonus because of Carl’s unilateral decision to alter the terms of the consulting agreement.

On the morning of October 31, 1991, appellee negotiated a $300,000 project with GE. Upon his return to ITI, Leckie asked to speak to him after lunch. At 2:00 that afternoon, Leckie handed appellee a letter of termination. The letter provided that ITI would continue to pay appellee commissions due on existing purchase orders through the duration of the project and that commissions on maintenance contract revenue would be paid through December 31, 1991. Leckie explained that appellee’s termination would reduce costs.

Leckie testified below that he decided, at the time of appellee’s termination, to put less emphasis on CAPP/MD while increasing the effort to market MULTI-CAPP. Further, Leckie stated that he had assumed appellee’s duties concerning CAPP/MD since the termination.

Jack Lemon testified that Leckie discussed with him terminating appellee as a cost-saving measure but did not mention that Leckie planned to eliminate the CAPP/MD product line. Lemon further stated that CAPP/MD continued to make a profit for ITI and that he would not continue marketing the program if it were not a growth product.

Lemon also testified that he had taken on appellee in 1989 as a favor and that he had expected appellee to find other employment. Contrary to Leckie’s testimony that appellee was terminated for cost-saving reasons, Lemon opined that appellee was discharged for poor performance. Lemon took this position even though appellee had earned substantial commissions while in ITI’s employ. *357 Lemon claimed that appellee had been provided with the opportunity to make those sales because ITI was trying to help him.

Kay Lemon, ITI’s director of human resources and corporate secretary, testified that after appellee’s discharge, she had concerns about age discrimination.

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Bluebook (online)
666 N.E.2d 257, 106 Ohio App. 3d 349, 1995 Ohio App. LEXIS 3933, 68 Fair Empl. Prac. Cas. (BNA) 1562, Counsel Stack Legal Research, https://law.counselstack.com/opinion/atkinson-v-international-technegroup-inc-ohioctapp-1995.