McKissick v. Yuen

618 F.3d 1177, 31 I.E.R. Cas. (BNA) 285, 2010 U.S. App. LEXIS 18753, 2010 WL 3489748
CourtCourt of Appeals for the Tenth Circuit
DecidedSeptember 8, 2010
Docket08-5151, 09-5078
StatusPublished
Cited by106 cases

This text of 618 F.3d 1177 (McKissick v. Yuen) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McKissick v. Yuen, 618 F.3d 1177, 31 I.E.R. Cas. (BNA) 285, 2010 U.S. App. LEXIS 18753, 2010 WL 3489748 (10th Cir. 2010).

Opinion

GORSUCH, Circuit Judge.

Pamela McKissick, a former Gemstar executive, sued the company and two of its former officers, accusing them of perpetrating a fraud that rendered her stock options in the company worthless. The district court granted summary judgment to the defendants, holding that Ms. McKissick released her claims long ago when she signed a separation agreement at the end of her employment. Based on another provision in that same agreement, the district court also awarded attorney fees to both Gemstar and its former officers. Ms. McKissick now appeals all these determinations.

We agree with the district court that the separation agreement unambiguously bars Ms. McKissick’s claims and affirm summary judgment for the defendants on that score. Although we also agree with the district court that the separation agreement entitles Gemstar to recoup the attorney fees it incurred in defending Ms. McKissick’s suit, the agreement doesn’t permit the company to recover the fees it incurred in prosecuting a counterclaim against Ms. McKissick. We thus vacate the district court’s fee award to Gemstar, and remand the matter for recalculation of an appropriate award. As for the former officers, we conclude the separation agreement doesn’t entitle them to attorney fees at all. Accordingly, we reverse their fee award.

I

A

This case began on the eve of a merger between Gemstar and TV Guide in July 2000. In the deal, Gemstar, a technology company, was slated to take control of TV Guide, the longtime publisher of television programming guides. At the time, Ms. McKissick served as President and Chief Operating Officer of a TV Guide subsidiary. Ms. McKissick apparently worried about the merger and what it might mean for her options to purchase 200,000 shares of TV Guide common stock. If she exercised those options before the merger, and many were slated to vest by that point, Ms. McKissick was confident that their value would allow her to fulfill her longtime dream of owning a horse ranch in Oklahoma. In the end, however, she didn’t exercise the options, and this lawsuit is all about why.

According to Ms. McKissick, Henry Yuen and Elsie Leung, executives for Gemstar, lobbied her to stick with the new company and hold on to her options. They told her it would be bad for the merger if senior TV Guide executives were seen selling, a signal to investors that they lacked faith in TV Guide’s new parent company. Better, they said, to wait, convert the TV Guide options into Gemstar options, and exercise them later. The merger, they said, would be nothing but good for Ms. McKissick and her stock options. The op *1181 tions’ value was sure to rise. If only she would wait three years, she could “retire on the beach.”

Ms. McKissick waited. The merger occurred in July 2000 and Ms. McKissick retained both her position within the newly merged company and most of her stock options. Even so, she went ahead with her ranch plans, purchasing a number of Icelandic horses and eighty acres near Tulsa. Ms. McKissick depended on her salary to stay current with the financing for the ranch, and she shared this fact with Gemstar higher-ups. They, in turn, assured her that her job was safe.

Things turned out differently. Gems-tar’s share price fell significantly by early 2003, to the point where Ms. McKissick believed her stock options virtually worthless. According to Ms. McKissick, the responsible parties for all this were Mr. Yuen and Ms. Leung, who fraudulently reported Gemstar’s finances in connection with and following the merger. Once discovered, Ms. McKissick alleges, this misconduct caused the company’s value to tumble, and eventually contributed to the company’s decision to terminate Mr. Yuen’s and Ms. Leung’s employment in April 2003.

As it happened, Ms. McKissick, too, was soon to leave Gemstar. An at-will employee, she learned of Gemstar’s plans to fire her in July 2003, and soon afterward met with a human resources representative to discuss a severance agreement. Ms. McKissick sought eighteen months’ salary and health coverage, a temporary consulting position, and a guarantee she would be reimbursed for any expenses she might incur should her cooperation be needed in litigation against the company. The Separation Agreement and Release (“Agreement”) Gemstar ultimately offered, and which Ms. McKissick ultimately accepted, included some but not all of these requests. The Agreement afforded Ms. McKissick $345,000 severance (equivalent to a year’s salary), an $80,000 “bonus” for her “cooperation in the transition of her duties,” reimbursement for expenses incurred in cooperating with the company in litigation, and eighteen months’ health insurance, but the Agreement did not include the consulting arrangement she sought.

The Agreement also included two provisions concerning claims Ms. McKissick might seek to bring against Gemstar or other parties. Though lengthy, these provisions are the focus of the dispute before us and so we offer them here, in full. The first, the “Release,” said:

6. Released Actions/General Release. Employee (on behalf of herself and all her heirs, assigns, legal representatives, successors in interest, or any person claiming through her) hereby irrevocably and unconditionally releases and forever discharges the Company, its divisions, units, subsidiaries, parents, and all other affiliated entities, and each of their current and former employees, officers, directors, representatives, agents, shareholders, attorneys, accountants, partners, insurers, advisors, partnerships, assigns, successors, heirs, predecessors in interest, joint ventures, and affiliated persons (collectively “Released Parties”) from any and all liabilities, causes of action, charges, complaints, suits, claims, obligations, costs, losses, damages, injuries, rights, judgments, attorney’s fees, expenses, bonds, bills, penalties, fines, liens, and all other legal responsibilities of any form or nature whatsoever, whether known or unknown, suspected or unsuspected, fixed or contingent, which she has or had or may claim to have by reason of any and all matters from the beginning of time through the Effective Date (hereinafter collectively “Released Actions”) including, but not limited to, those arising from or in con *1182 nection with Employee’s employment with the Company or the termination of such employment relationship or under any federal, state or local employment laws, regulations, orders or other requirements, including, without limitation, any and all claims related to race, color, ancestry, national origin, sex, disability, medical condition, religion, age, sexual orientation or marital status discrimination in employment under Title VII of the 1964 Civil Rights Act, the Age Discrimination in Employment Act, the Fair Employment and Housing Act, the Workers Adjustment and Retraining Notification Act, the Equal Pay Act, the Americans with Disabilities Act, the Fair Labor Standards Act, any Oklahoma state law, statute, rule, regulation or ordinance pertaining to labor, employment, discrimination or benefits, or any other law, regulation, or ordinance that may have arisen from Employee’s employment with the Company and/or as a result of, or in connection with, the termination of her employment relationship with the Company.

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Cite This Page — Counsel Stack

Bluebook (online)
618 F.3d 1177, 31 I.E.R. Cas. (BNA) 285, 2010 U.S. App. LEXIS 18753, 2010 WL 3489748, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mckissick-v-yuen-ca10-2010.