Brown Jordan International, Inc. v. Christopher Carmicle

846 F.3d 1167, 2017 WL 359651
CourtCourt of Appeals for the Eleventh Circuit
DecidedJanuary 25, 2017
Docket16-11350
StatusPublished
Cited by29 cases

This text of 846 F.3d 1167 (Brown Jordan International, Inc. v. Christopher Carmicle) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brown Jordan International, Inc. v. Christopher Carmicle, 846 F.3d 1167, 2017 WL 359651 (11th Cir. 2017).

Opinion

BLACK, Circuit Judge:

This case arises out of Christopher Car-micle’s termination from Brown Jordan 1 in early 2014. The parties filed cross-complaints, and the two cases were consolidated. After granting summary judgment in favor of Brown Jordan on some of Carmi-cle’s claims, the district court conducted an 11-day bench trial and entered judgment on behalf of Brown Jordan. Carmicle appeals, raising issues regarding the Computer Fraud and Abuse Act (CFAA), 18 U.S.C. § 1030, the Stored Communications Act (SCA), 18 U.S.C. § 2701, wrongful discharge, and breach of an employment agreement.

We affirm the district court. Carmicle’s CFAA arguments fail because Brown Jordan suffered “loss” as defined in the CFAA. As to his SCA issues, Carmicle waived his unopened-versus-opened-email argument because he did not fairly present it to the district court, and Brown Jordan showed Carmicle exceeded his authorization in accessing the emails of other Brown Jordan employees. Lastly, the district court did not err in granting summary judgment on Carmicle’s wrongful discharge claim or in concluding that Carmi-cle was terminated for cause as defined by the Employment Agreement.

I. BACKGROUND

A. Factual Background

Carmicle began working for Brown Jordan in 2002. Carmicle rose swiftly through the ranks at Brown Jordan, the parent company of a number of entities engaged in the manufacture and sale of furniture for residential and commercial use. By 2005, Carmicle was responsible for the national accounts of Brown Jordan, which soon after led to his responsibility for a Brown Jordan subsidiary, Brown Jordan Services. According to Brown Jordan, Car-micle was never formally appointed as president of Brown Jordan Services, but was permitted to use the title as a “customer facing accommodation.”

When Gene Moriarty became CEO of Brown Jordan, Moriarty requested Carmi-cle enter into an Executive Employment Agreement with Brown Jordan. The November 1, 2005 agreement solidified the terms of Carmicle’s employment and is the only written employment agreement between Carmicle and Brown Jordan. Carmi-cle subsequently entered into Profits Interest Agreements with Brown Jordan, pursuant to which Carmicle acquired a profits interest in BJI Holdings, LLC, subject to the Agreements’ vesting and forfeiture provisions.

Moriarty testified that he and others began to have doubts about Carmicle around 2011. Indication that Carmicle had been incurring excessive entertainment expenses began to appear. It was also discovered that Carmicle’s wife was on Brown *1171 Jordan’s payroll and Carmicle himself approved her salary. After a stern warning about these actions, Moriarty gave Carmi-cle a second chance. Moriarty also gave Carmicle greater responsibility making him responsible for Brown Jordan Company, another Brown Jordan subsidiary, in addition to Brown Jordan Services.

In 2013, Moriarty learned that Carmicle had breached his trust again by incurring more unauthorized expenses. As far as Moriarty was concerned, Carmicle had blown his second chance. Moriarty was ready to terminate Carmicle’s employment for cause.

However, Moriarty was persuaded not to pursue termination at that time. In the spring of 2013, Brown Jordan’s Board of Directors decided to hire an investment bank and offer Brown Jordan for sale. Brown Jordan would be sold as a whole to a single buyer, or alternatively, the commercial and consumer businesses would be divided and offered to separate purchasers. In the event Brown Jordan were sold separately, Moriarty would likely remain with the commercial business and Carmi-cle would remain with the consumer business, so Moriarty would no longer have to work with Carmicle and the buyer of the consumer business would have the benefit of continuity. Moriarty ultimately agreed that it was best not to terminate Carmi-cle’s employment while Brown Jordan was offered for sale.

In the meantime, Moriarty, Brown Jordan’s CFO, and Brown Jordan’s General Counsel decided to pursue a management buyout (MBO) of the commercial business. In connection with seeking lending to finance the MBQ, they prepared a financial model that differed from that prepared by Brown Jordan’s investment bank for potential outside buyers.

In the summer of 2013, Brown Jordan began a transition from one email service to another. To assist in that transition, Brown Jordan’s Chief Information Officer provided a generic password—Pass-wordi—to Brown Jordan employees and instructed each to. test his or her new email account with that password.

Carmicle testified that he was suspicious that a subordinate employee he considered difficult to manage was communicating directly with Moriarty, and that both were lying to Carmicle about a personnel issue. This prompted Carmicle to use the generic password to access their accounts and read their emails. From there, Carmicle’s behavior began to snowball. Carmicle repeatedly accessed the email accounts of other employees, including his superiors, with the generic password and used his personal iPad to take screenshots of hundreds of emails over the next six months. Along the way, Carmicle learned about the MBO and the second financial model. Car-micle also learned that Brown Jordan’s CFO was scrutinizing his expenses.

As 2014 began, it became clear that Brown Jordan Services and Brown Jordan Company had not performed well. Brown Jordan’s Board of Directors was scheduled to meet in early 2014, and the. poor performance of Brown Jordan Services and Brown Jordan Company were on the agenda. In an attempt to save his job, Carmicle wrote a letter to Brown Jordan’s Board of Directors in January of 2014, accusing Moriarty and others of various illegal and fraudulent activities, including their preparation of a second financial model to the detriment of shareholder value in an attempt to secure the consumer business through an MBO.

Concerned about Carmicle’s accusations, and because Carmicle had expressed a fear of retaliation, the Board of Directors hired an independent investigator. During the investigation - into Carmicle’s allegations, *1172 Carmicle revealed to the investigator that he had learned much of the information contained in his letter by accessing others’ email accounts. The investigator ultimately concluded Carmicle’s allegations were entirely without merit, and reported that fact to the Board of Directors. The investigator also reported Carmicle’s email access and the fact Carmicle had used in excess of $100,000.00 in Brown Jordan funds for unauthorized entertainment expenses. When the Board of Directors met in February 2014, they decided that Carmicle’s employment should be terminated for cause.

On February 17, 2014, Moriarty met with Carmicle and informed him of the decision to terminate his employment for cause. Carmicle demanded that he be permitted to take his personal laptop with him when he left, but was told it would not be returned to him until Carmicle proved he had used his own funds to purchase the laptop.

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846 F.3d 1167, 2017 WL 359651, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brown-jordan-international-inc-v-christopher-carmicle-ca11-2017.