United States District Court, D. Nebraska
TIMOTHY A. GILKERSON, Plaintiff,
NEBRASKA COLOCATION CENTERS, L.L.C., Defendant.
MEMORANDUM AND ORDER
M. Gerrard United States District Judge
plaintiff, Timothy Gilkerson, is suing his former employer,
Nebraska Colocation Centers, L.L.C. (NCC), for allegedly
breaching Gilkerson's employment contract. NCC contends
the contract was validly rescinded by the parties, but
Gilkerson claims the rescission is void due to duress. This
matter is before the Court on the defendant's motion for
summary judgment (filing 48). The defendant's
motion will reluctantly be granted.
was hired in 2011 to be NCC's Vice President and General
Manager. Filing 49 at 1. Gilkerson and NCC agreed to
a 10-year employment contract, paying Gilkerson an annual
base salary of $84, 000, quarterly sales bonuses, and a
retirement bonus upon the expiration of Gilkerson’s
employment period. Filing 51-2 at 1; filing
55 at 9. Gilkerson was responsible for developing
NCC's information technology infrastructure. Filing
49 at 1-2. The parties disagree about the extent to
which Gilkerson was expected to help with NCC's sales,
and his commissions under the employment contract were based
on the company's sales, not his. Filing 49 at 2;
filing 55 at 2.
employment contract provided that if NCC terminated
Gilkerson's employment without cause before the 10-year
term expired, Gilkerson would receive his remaining salary
for the balance of the term in a lump sum, another 5
years' bonuses, and his full retirement bonus. Filing
51-2 at 5-6. But if Gilkerson were to be terminated
with cause, he would receive only his unpaid compensation for
services already performed. Filing 51-2 at 6. As
relevant, "cause" for termination could include
Gilkerson's "willful misconduct" in carrying
out his duties; or "persistent failure to perform the
duties and responsibilities of his employment hereunder;
which failure is not remedied by him within 30 days after
[his] receipt of written notice from [NCC] of such
failure." Filing 51-2 at 4.
evidently unhappy about Gilkerson's performance helping
with sales, and NCC's president, Jerry Appel, talked with
Gilkerson about how he wanted Gilkerson to "[c]lose more
deals." Filing 51-1 at 11. Gilkerson's
performance review was generally average to positive, except
for "[u]nsatisfactory" ratings in "[a]chieves
sales goals" and "[f]ulfills the terms of his
contract." Filing 57-4 at 2. The review
indicated that Gilkerson's "lack of sales is
irrefutable and of great concern[, ]" and detailed
Gilkerson's alleged failings in sales. Filing
57-4 at 3. Gilkerson signed the review on February
5, 2013, acknowledging its receipt. Filing 57-4 at
4. Gilkerson's comments on the review express his
disagreement regarding sales goals, generally explaining that
his experience was not in sales and that "except in the
startup phase when everyone needed to pitch in and wear many
hats[, ]" he had understood that sales would be the
responsibility of a dedicated sales team. Filing
57-4 at 4-5.
announced the hiring of a new "Vice President - Sales
and Marketing" on July 8, 2013. Filing 57-5 at
1. On the same day, Appel told Gilkerson that Gilkerson's
office was to be given to the new hire, and that
Gilkerson's job title had been changed to "Director:
Field Engineering and Channel Services." Filing
57-5 at 3. Gilkerson was also informed that Appel
was "developing a new compensation program for [his] new
position. It [would] retain [his] salary at the current
level, provide incentives for channel and carrier sales, and
bonuses for field engineering and product development."
Filing 57-5 at 3. Then, on July 15, 2013, Appel met
with Gilkerson and presented Gilkerson with a document
captioned "Mutual Rescission, " which would rescind
Gilkerson's employment contract. Filing 49 at 4;
see filing 51-5. Gilkerson was also
presented with a "term sheet" setting forth
proposed terms of Gilkerson's continued employment.
See filing 51-6.
Gilkerson contends he was given different term sheets at
different times, it is clear that the term sheet he
ultimately signed provided Gilkerson with the same base
salary as the employment contract, a higher commission rate,
and an additional bonus contingent upon certain goals. Filing
51-6; filing 57-3 at 4; see filing
57-8. But it limited calculation of commission to
Gilkerson's "customers" as defined by the term
sheet, and did not include the retirement bonus. Filing
51-6. And the term sheet did not prohibit
Gilkerson's termination. Filing 51-6.
did not immediately agree to the rescission and term sheet.
See filing 49 at 5. He met with Appel again
on July 17, 2013. Filing 49 at 5. Both meetings were
recorded. See filing 57-6. During the
meetings, Appel was sharply critical of Gilkerson's
performance. E.g. filing 57-6 at 3-6, 10,
23, 30. Appel clearly presented Gilkerson with a choice
between agreeing to the rescission and term sheet, or being
fired for cause. E.g. filing 57-6 at 4. For
instance, when Gilkerson asked Appel whether his employment
contract "means nothing, " Appel replied,
No. In their opinion you didn't live up to what your
obligations were in this contract, which is to be - make this
thing successful, make this thing work. . . . I'm going
to tell you, you go ahead and go - If you're going to go
to your lawyer, go to your lawyer, but you'll go to your
lawyer without a job.
57-6 at 4. Appel warned Gilkerson that money was
available for litigation, and that NCC could
"outlast" Gilkerson. Filing 57-6 at 26.
But Appel tried to persuade Gilkerson to accept the
rescission and term sheet and continue working for NCC,
asserting that he still believed Gilkerson could be
successful and earn as much as he would have earned under the
employment contract. E.g. filing 57-6 at
12. Appel also pointed out that it "would be tough"
for Gilkerson to be unemployed, in part because Gilkerson had
health problems and couldn't afford to lose his
insurance. Filing 57-6 at 43. Appel told Gilkerson,
"If I were in your shoes and if I'm thinking
clearly, I'm saying, Wait a second. What's my
alternative? 30 days from now I'm without a job.
That's my alternative. Do I want that?" Filing
57-6 at 46-47. Appel agreed that he was
"basically saying" that if Gilkerson did not sign
the rescission, Gilkerson would be fired. Filing
57-6 at 29.
was able to briefly consult with counsel after the first
meeting with Appel. Filing 51-1 at 5; see
filing 57-6 at 31. But Gilkerson ultimately signed
the rescission and term sheet on July 18, 2013. Filing
49 at 6. NCC fired Gilkerson on January 8, 2014.
Filing 49 at 6. Gilkerson sued NCC in state court,
alleging breach of contract and violation of the Nebraska
Wage Payment and Collection Act, Neb. Rev. Stat. §
48-1228 et seq. Filing 1-1 at 26-30. After some
procedural confusion that is no longer relevant, NCC
eventually removed the case to this Court. Filing 1.
Now before the Court is NCC's motion for summary judgment
judgment is proper if the movant shows that there is no
genuine dispute as to any material fact and that the movant
is entitled to judgment as a matter of law. SeeFed. R. Civ. P. 56(a). The movant bears the initial
responsibility of informing the Court of the basis for the
motion, and must identify those portions of the record which
the movant believes demonstrate the absence of a genuine
issue of material fact. Torgerson v. City of
Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (en
banc). If the movant does so, the ...