The opinion of the court was delivered by: James S. GWIN,*fn1 United States District Judge
OPINION AND ORDER [Resolving Doc. No. 34]
In this breach of employment contract case, the Defendants Institutional Trading Company and IT.com move for summary judgment against their former director of research Plaintiff Kwong Yung. [Doc. 34.] With his Complaint, Plaintiff Yung brings claims against the Defendants for breach of his employment contract, failure to pay wages, conversion of a laptop computer, and fraud. [Doc. 1 at 10.]
For the following reasons, the Court GRANTS IN PART and DENIES IN PART the Defendants' motion for summary judgment.
This case arose after Defendant IT.com, a technology company, fired Plaintiff Kwong Yung on December 12, 2006. Before firing Yung, Defendant IT.com employed him as director of research and chief scientist. According to Yung, his termination violated a three-year employment contract. Yung also alleges that IT.com has refused to pay him wages for his final month of employment, refused to reimburse him for travel expenses, and refused to return a laptop computer he used at work.
In 1983, Mark Cordover founded Defendant Institutional Trading Company, a private investment company. [Doc. 34-3 at 2.] In 2005, Cordover created Defendant IT.com, a start-up technology company based in Washington, D.C. [Id.] In staffing the new company, Cordover interviewed and ultimately hired Plaintiff Yung to work as IT.com's director of research.*fn2 [Doc. 34-3 at 2-3.] Cordover hired Yung, who holds a Ph.D. from Stanford University in statistics and machine learning, to help engineer a vertical search engine for the company. [Doc. 34-3 at 2, 34-5 at 13.]
Between November 18, 2005, and November 20, 2005, Cordover and Plaintiff Yung negotiated Yung's employment terms. [Doc. 34-5 at 14-16.] On November 26, 2005, Cordover sent Yung an Engagement Letter, formally offering him a position with the company. [Doc. 34-5 at 13.] According to this letter, Yung would receive a three percent ownership interest in IT.com. [Doc. 34-5 at 13.] The Engagement Letter, however, also gave the company the right to:
[R]epurchase all of the stock should [Yung] leave IT.com's employ within the first year, [repurchase] two-thirds of the stock should [Yung] leave between the first and second years, and [repurchase] one-third of the stock should [Yung] leave between the second and third years. Thereafter, IT.com will hold no right to repurchase [Yung's] stock. [Doc. 34-5 at 13. ]
Second, the Engagement Letter stated that IT.com would: "pay the expenses of your visiting California for business reasons at least three times (at your discretion) any time during the next calendar year." [Doc. 34-5 at 13.] Ultimately, Plaintiff Yung accepted the offer and moved from California to Washington, D.C., to begin work at IT.com.
On Yung's first day with the company, December 1, 2005, he signed a Restricted Stock Agreement. [Doc. 34-5 at 4-11.] This agreement required Defendant IT.com to repurchase Yung's shares on a pro rata basis if he left the company within his first three years. [Doc. 34-5 at 4.] The agreement also stated:
Nothing in this Agreement shall be construed as constituting a commitment, guarantee, agreement or understanding of any kind or nature that the Corporation shall continue to employ [Yung], nor shall this Agreement affect in any way the right of the Corporation to terminate the employment of [Yung] at any time. In the absence of an employment agreement, or of a provision in such an agreement to the contrary, [Yung] acknowledges that he is an employee at will. [Doc. 34-5 at 9.] On January 1, 2006, Cordover gave Yung a stock certificate transferring thirty shares of IT.com stock to Yung. [Doc. 34-5 at 2.]
A few months later, IT.com purchased three laptop computers and provided one to Plaintiff Yung. [Doc. 34-3 at 3, 7.] The parties dispute whether IT.com gave Yung the computer outright or merely permitted him to use it for work. [Doc. 34-3 at 3, 39-1 at 2.] In support of his claim that IT gave him the laptop, Yung says that he put personal files and software he had purchased on the computer. [Doc. 39-1 at 1.] On December 11, 2006, Cordover confiscated the laptop from Yung. [Doc. 39-1 at 1.]
During his employment, Yung submitted one travel reimbursement request to Defendant IT.com. [Doc. 34-4 at 44.] IT.com paid Yung the full $3,692.11 he requested. [Doc. 34-3 at 13-15.] Plaintiff Yung says that he took several other trips in 2006 at a cost of $7,608.40 but did not submit reimbursement requests to IT.com. [Doc. 34-4 at 44.]
On December 10, 2006, more than a year after Yung joined the company, Cordover placed Yung on two weeks probation, apparently because Yung had spent time on what Cordover believed to be unnecessary projects and had unexplainedly left the office for extended periods of time. [Doc. 39-7.] Two days later, December 12, 2006, Cordover fired Yung. [Doc. 34-4 at 10.]
According to Yung, later on December 12, 2006, he and Cordover orally agreed that Yung would write up the details of a key mathematical algorithm he had developed for IT.com in exchange for "payment of wages through December 31, 2006, and my computer." [Doc. 39-1 at 2.] Yung says he worked on the algorithm summary for the next week and gave it to Cordover on December 19, 2006. [Doc. 39-1 at 2.] Yung claims that Cordover then asked him to sign an Employment Separation Agreement containing what Yung viewed as unfavorable terms. [Doc. 39-1 at 2.] Yung thus refused to sign. [Id.]
On September 28, 2007, Plaintiff Yung sued the Defendants in San Francisco Superior Court. [Doc. 1 at 8.] In his Complaint, Yung claimed that the Defendants breached his employment contract by terminating him without cause, not paying his full December 2006 salary, and not reimbursing him $7,608.40 in travel expenses. [Doc. 1 at 10.] Yung also made claims for unpaid wages, conversion of the laptop computer, and fraud. [Doc. 1 at 10-12.]
On November 26, 2007, the Defendants removed the case to the U.S. District Court for the Northern District of California. [Doc. 1 at 1.] On April 14, 2008, the district court granted the Defendants' motion to transfer the case to this Court. [Doc. 18.] Finally, on March 16, 2009, the Defendants filed the instant motion for summary judgment. [Doc. 34.] The Plaintiff has responded, [Doc. 39], and the Defendants have replied. [Doc. 41.] Accordingly, the motion is ripe for ruling.
Summary judgment is appropriate when "there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c).
A defendant moving for summary judgment has the initial burden of showing the absence of a genuine factual issue with respect to one or more essential elements of the plaintiff's claim. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). The moving defendant meets his burden by "informing the district court of the basis for its motion, and identifying those portions of 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which [he] believes demonstrate the absence of a genuine issue of material fact." Id. at 323 (quoting Fed. R. Civ. P. 56(c)). However, the moving defendant is under no "express or implied" duty to "support [his] motion with affidavits or other similar materials negating the opponent's claim." Id.
Once the moving defendant satisfies his burden, the burden shifts to the nonmoving plaintiff to set forth specific facts showing a triable issue. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). The nonmoving plaintiff may not defeat the summary judgment motion merely by showing some existence of doubt as to the material facts. See id. at 586. Nor can the nonmoving plaintiff rely upon the mere allegations or denials of her pleadings. Fed. R. Civ. P. 56(e).
In deciding a motion for summary judgment, the Court views the factual evidence and draws all reasonable inferences in favor of the nonmoving plaintiff. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970). To be sure, the Court need not conclusively resolve an allegedly disputed issue in favor of the nonmoving plaintiff; rather, the plaintiff must present "sufficient evidence supporting the claimed factual dispute . . . to require a jury or judge to resolve the parties' differing versions of the truth at trial." First Nat'l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 288-89 (1968). Ultimately the Court must decide "whether the evidence presents sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986).
In moving for summary judgment, the Defendants largely argue that Plaintiff Yung can provide no evidence in support of ...