Martin v. SCOTT & STRINGFELLOW, INC.

643 F. Supp. 2d 770, 2009 U.S. Dist. LEXIS 50811, 2009 WL 1706650
CourtDistrict Court, E.D. Virginia
DecidedJune 17, 2009
DocketCivil Action 3:08cv417
StatusPublished
Cited by5 cases

This text of 643 F. Supp. 2d 770 (Martin v. SCOTT & STRINGFELLOW, INC.) is published on Counsel Stack Legal Research, covering District Court, E.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Martin v. SCOTT & STRINGFELLOW, INC., 643 F. Supp. 2d 770, 2009 U.S. Dist. LEXIS 50811, 2009 WL 1706650 (E.D. Va. 2009).

Opinion

MEMORANDUM OPINION

ROBERT E. PAYNE, Senior District Judge.

This matter is before the Court on the Motion for Summary Judgment (Docket No. 97) filed by the plaintiff, Timothy Martin, 1 and the Motion for Summary Judgment (Docket Number 126) of the Defendant, Scott & Stringfellow, Inc. (S & S). For the reasons set forth below, Martin’s motion for summary judgment will be denied, and the motion for summary judgment of S & S will be granted.

BACKGROUND

The following facts are undisputed by the parties unless otherwise noted. On September 7, 2004, S & S hired Martin, who was fifty-one-years-old at the time, to “head up” a Distressed Commercial Mortgage Backed Securities Group (“CMBS”) at its Charlotte, North Carolina office. (PI. Dep. at 48) Martin was interviewed by Ted Luse, head of the S & S Fixed Income Department, and William B. Cameron, head of the CMBS group at the Charlotte office. 2 (Id. at 42-44.) Cameron made the *776 decision to hire Martin based on his familiarity with Martin and his high regard for Martin’s abilities in the sale of CMBSs. (Def. Mem. at Ex. 5, ¶¶ 5-6.) Cameron was aware that Martin was 51 years old at the time that he was hired. (Def. Mem. at Ex. 5 at ¶ 7.)

Martin, by his own admission, was hired as a salesman for distressed CMBS products. 3 (See Def. Mem. at Exs. 5, 7, 8.) Therefore, Martin was permitted to undertake only “riskless” sales of CMBS products, ie., sales in which no capital of S & S was at risk. (Def. Mem. at Ex. 5, ¶8; Def. Rep. at Ex. G, pp. 86-87.) Martin was paid a commission of 40% (in some cases, 45%) on each sale of a CMBS. (Def. Mem. at Ex. 2.) Martin generated approximately $610^000 in sales of CMBS products in the first four months of 2005, thus generating personal commissions of approximately $274,000. (Def. Mem. at Ex. 9; Def. Rep. at Ex. G, pp. 89-90.) Based on these sales, Martin was awarded a “Sterling Performer Award” for the first quarter of 2005 in June, 2005. (Def. Mem. at Ex. 10.)

In early 2005, S & S decided to allow Martin to put its capital at risk in sales of CMBS products. (Id. at Ex. 3, p. 27; Ex. 5, ¶ 9, 11.) As a consequence, Cameron and Luse decided that Martin’s compensation structure needed to be revised in order to account for the financial risk to S & S. (Id. at Ex. 5, ¶ 11.) This arrangement created a “reserve fund” from the profits of the risk transactions, intended to protect the financial integrity of S & S, and thereby made Martin responsible for losses suffered by S & S on Martin’s “risk” transactions. (Id. at ¶ 11.) Martin eventually contributed to this reserve fund, but Martin denies that he ever explicitly agreed to this compensation arrangement. (Id. at Ex. 7; PI. Resp. at 19.) In any event, Martin was not happy with this payment structure and complained to Cameron, Luse, and other employees about it throughout 2005. (Def. Mem. at Ex. 3, pp. 100-101; Ex. 12, ¶ 6.)

Martin, evidently, was also unhappy with Cameron’s management technique. (Def. Mem. at Ex. 13, pp. 37-38.) In May, 2005, Martin sent an email to Luse, Cameron’s manager, complaining of his rocky relationship with Cameron. (PI. Dep. at 148; Def. Mem. at Ex. 14.) Martin also sent an email to Daniel Cardani, the National Sales Manager, alleging that Cameron had lied to Martin and stating that Martin had no respect for Cameron and wished to cease working for him. (PL Dep. at 442; Def. Mem. at Ex. 15.) Throughout middle and late 2005, Martin’s stream of disparaging comments about Cameron continued. (See Def. Mem. at Exs. 16, 19.) Martin communicated his distaste for Cameron to a number of S & S employees, including Luse; referring to Cameron as the “emperor ... [with] no clothes” and a “real bad hire.” (Id. at Ex. 16.) Martin simultaneously expressed his dissatisfaction with Cardani. (See id.) This unhappiness led Martin to the pursuit of other employment opportunities with competing brokerage firms. (Def. Mem. at Ex. 3, p. 102.)

Martin also began to question Cameron’s relationship with Martin’s assistant, Kate Mosser. (Def. Mem. at Ex. 16.) Martin alleged that Cameron’s objectivity has been compromised by the relationship and that he was taking an inappropriate interest in Mosser. (See id. at Exs. 16, 17.) Martin also stated that rumors were *777 circulating among S & S employees that Cameron and Mosser were having an affair. (Id. at 17.) Additionally, Martin, in an email to a coworker, referred to Mosser as Cameron’s “little bitch. 4 (Id. at Ex. 18.)

Cameron became aware of Martin’s comments in October, 2005, while on a business trip to New York. (Def. Mem. at Ex. 5, ¶ 12.) Cameron says that Mosser accompanied him on the trip to further her training and experience. (Id.) John Sherwood, an S & S employee, informed Cameron that Martin was commenting to other employees about the alleged affair between Cameron and Mosser. (Id.) Upon his return to the office, Cameron informed Martin that such statements were unacceptable. (Id.; see also Def. Mem. at Ex. 3. p. 51.) In November 2005, Martin drafted a “Business Plan” in which he stated that Cameron and Mosser had an inappropriate relationship and that Cameron had lost his objectivity toward Mosser. (Def. Mem. at Ex. 20.)

It was also in November, 2005 that Martin “mooned” the trading floor at the Charlotte office. (Def. Mem. at Ex. 13, pp. 74-76.) While Martin now simultaneously denies this event entirely and offers an alternative explanation for it, his deposition testimony taken during the arbitration proceeding makes clear that he intentionally mooned the trading floor at least once, after having been “egg[ed] on,” and that he regretted the event and regarded it as sophomoric. (Id.)

In late November 2005, Martin suffered a loss of $545,000 on a risk transaction involving bonds the value of which had been significantly reduced by the impact of hurricane Katrina (the “Katrina bonds”). (PI. Dep. at 239.) Shortly thereafter, Martin sold a number of Goldman Sachs bonds at a profit. (Def. Mem. at Ex. 5, ¶ 13.) Cameron, in accord with his earlier conversations with Luse about Martin’s compensation structure on risk transactions, offset Martin’s commission on the Goldman Sachs transaction to reflect the loss on the Katrina bonds. (Id.; see also Def. Mem. at Ex. 12, ¶ 8.)

Martin was informed of this decision in December 2005 and strongly disagreed with it. (PI. Dep. at 247-49, 255 — 56. 5 ) Evidently, Cameron’s decision to withhold the commission on the Goldman Sachs bonds would compromise Martin’s ability to complete his planned purchase of a house. (Id. at 255.) Martin immediately drafted a memorandum expressing his disagreement and sent it to Luse on December 24, 2005. (Def. Mem. at Ex.

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Bluebook (online)
643 F. Supp. 2d 770, 2009 U.S. Dist. LEXIS 50811, 2009 WL 1706650, Counsel Stack Legal Research, https://law.counselstack.com/opinion/martin-v-scott-stringfellow-inc-vaed-2009.