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Morris v. Buvermo Properties

September 24, 2007

JONATHAN H. MORRIS, PLAINTIFF,
v.
BUVERMO PROPERTIES, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Henry H. Kennedy, Jr. United States District Judge

MEMORANDUM OPINION

By this action Plaintiff Jonathan H. Morris seeks to hold his former employer Buvermo Properties, Inc., and seven related parties, liable on causes of action, including breach of contract, arising from the termination of his employment as Buvermo's president. Before the court is defendants' motion for summary judgment [#28]. Upon consideration of the motion, the opposition thereto, and the summary judgment record, the court concludes that defendants' motion must be granted in part and denied in part.

I. BACKGROUND

Morris, a resident of Florida, is an experienced real estate professional who was hired in 2005 to serve as president of Buvermo. Buvermo, a Delaware corporation with offices in Virginia, purchases and manages real estate investments. Certain other defendants - F.P. Executive Partners (FPEP), Fidelio Properties Management, Inc., L.L.C., Janivo Realty, Inc., Donelux, Inc., Orvan, Inc. - are partners of Fidelio Properties ("Fidelio"), a New York partnership that invests in Washington, D.C. real estate and owns a majority of Buvermo's stock. John Gardner, a resident of Virginia, is a minority owner of Buvermo who served as its president for twenty years before he was to be replaced by Morris.

In approximately February 2005, Buvermo hired an executive search firm, Equinox Partners, to identify candidates who would be considered for the position of Buvermo's president. The search was handled by the search firm's chief executive officer, Anthony LoPinto, and an executive recruiter, Marsha Pearcy, who prepared a "position specification" to describe the opening. The specification does not specify a term of service for the position and when LoPinto and Pearcy spoke with Morris in approximately May 2005 regarding the opportunity they did not indicate that the position was for a specific term.

Following these discussions, Morris was interviewed by Buvermo's principals: Joost Tjaden and Andre van Rhee, members of Fidelio's management committee, and Gardner. During the interviews, the principals of Buvermo explained to Morris that they were committed to long-term investment in real estate and were seeking a president who shared that outlook and would be available and willing to commit to the position for the long-term. Morris indicated that he shared that outlook and would be willing to make such a commitment.

Following these interviews, LoPinto called Morris to determine how long he would be willing to commit to serving as Buvermo's president. Morris indicated that he would make a ten-year commitment. Pl.'s Ex. 9 (Morris Dep.) at 136--38. Morris asserts that he "confirmed both with Gardner and Tjaden his commitment to remain employed with Buvermo for a period of ten years and they, in turn, confirmed Buvermo's agreement to employ him for a minimum of ten years." See Pl.'s Statement of Material Facts ¶ 50 (citing to Pl.'s Ex. 9 (Morris Dep.) at 136--140, 157--161, 173--74). Gardner and Tjaden, however, dispute that they ever promised to employ Morris for ten years.

On June 3, 2005, Morris accepted the terms of employment as presented to him in an offer letter from Buvermo Properties, Inc. ("Offer Letter"). Pl.'s Ex. 14. The Offer Letter provided Morris's salary ($250,000), his starting date, and his benefits (health care, 401K, etc.). The Offer Letter also provided that Morris was entitled to certain "promoted interests," which are a certain percentage of investment proceeds that Buvermo may distribute to some of its partners and employees after first recovering its initial capital investment and a preferred rate of return. Compl. ¶¶ 20- 21.*fn1 Morris was entitled "upon start of employment" to a promoted interest in two existing projects (Sheraton Reston and Twinbrook), subject to a two-year vesting period. Pl.'s Ex. 14. at 1. The Offer Letter also provided that Morris was entitled to a promoted interest on certain future projects - projects that Morris initiated on or before December 31, 2005, and all projects initiated by Buvermo after that time. Id. Morris would also be entitled to invest in all future projects. Id. These interests would be provided through FPEP and subject to the terms of the FPEP Agreement. Id. The Offer Letter was silent as to a definite period of employment.

In his deposition, Morris testified that he was aware that the offer which he accepted was silent as to a term of years. Defs.' Ex. 5 (Morris. Dep.) at 217--18. He explained that he accepted the terms of the Offer Letter because he "trusted them." Id. at 218. According to Morris, in order to accept the position with Buvermo, he sold his townhouse in Florida and gave up pursuit of certain real estate investment opportunities. Further, he asserts that he purchased a $1.9 million penthouse in Washington, D.C., as a residence and a location where he could entertain Buvermo's clients.

After Morris began working for Buvermo, Morris helped identify and initiate two real estate projects for Buvermo - Spotswood Valley Shopping Center and Reston International Center - which were not acquired until after his termination. Meanwhile, a conflict arose between Morris and Gardner regarding the roles each were to play at Buvermo and whether Gardner was relinquishing sufficient control of the duties and responsibilities he had as Buvermo's former president.

On March 22, 2006, Morris attended a dinner meeting with Gardner, van Rhee, and Tjaden. At that meeting, Gardner presented a document that purported to show that Gardner's interest was ten percent of FPEP property and Morris's interest was three percent. Morris became "angry" about the document because it represented his interest at less than what he understood it to be, and because he had not been shown the document previously. Pl.'s Ex. 9 (Morris. Dep.) at 302--03. Morris was also upset because van Rhee "scolded" him for not knowing what was contained in the documents that Gardner presented. Id. at 301. After a heated discussion with van Rhee about Gardner's compensation, Morris told the others that he had been "subjected to as much yelling, degradation, whatever, as [he] could possibly take" and he excused himself from the dinner. Id. at 307.

On March 24, 2006, Morris was advised, by letter, that he was being terminated effective immediately, citing no reasons for his termination.

II. ANALYSIS

Under Federal Rule of Civil Procedure 56, summary judgment shall be granted if the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits show that there is no genuine issue of material fact in dispute and that the moving party is entitled to judgment as a matter of law. Material facts are those "that might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In considering a motion for summary judgment, the "evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Id. at 255. But the non-moving party's opposition must consist of more than mere unsupported allegations or denials and must be supported by affidavits or other competent evidence setting forth specific facts showing that there is a genuine issue for trial. Fed. R. Civ. P. 56(e); Celotex Corp. v. Catrett, 477 U.S. 317 (1986). The non-moving party is "required to provide evidence that would ...


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