Fox v. Tambrands, 1st Cir. (1997)

USCA1 Opinion
NOT FOR PUBLICATION

NOT FOR PUBLICATION
___________________
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________
No. 96-1745
CARL M. BERKE, ET AL.,

Plaintiffs, Appellants,
v.
TAMBRANDS, INC.,
Defendant, Appellee.
____________________
No. 96-1830
DAVID A. FOX,
Plaintiff, Appellant,
v.
TAMBRANDS, INC.,
Defendant, Appellee.
____________________
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Robert B. Collings, U.S. Magistrate Judge]
_____________________
____________________
Before
Boudin, Circuit Judge,

_____________
Aldrich, Senior Circuit Judge,
____________________
and Lynch, Circuit Judge.

_____________
____________________
James E. Grumbach
___________________
with
whom
Marc E. Verzani
_________________
and
Brettler, LLP were on consolidated briefs for appellants.

________ ___
Zimble
______
Roger E. Podesta with

_________________
Richard L. Nahigian
_____________________
and
whom Harry Zirlin,

____________
Debevoise & Plimpt

___________________
Sullivan, Sullivan
& Pinta
______________________________
consolidated brief for appellee.
____________________
April 24, 1997

____________________
were
Per Curiam.
__________
Plaintiffs appeal from the district court's
summary judgment dismissal of their claims,
most importantly
that stock options and other incentive compensation
by
their
employer,
Tambrands
Inc.,
accelerated--rather than forfeited--when
subsidiary Hygeia
reading
of
the
have
Tambrands sold
Sciences, Inc., the company
plaintiffs directly worked.
court's
should
promised
been
its
for which the
Plaintiffs dispute the district
underlying
contracts;
they
also
challenge several discovery rulings.
After reviewing
the briefs and the
record, we conclude
that the district court's thorough opinion correctly analyzed
and
resolved
substantially
the
questions
presented.
We
affirm
for
the reasons given below, separately discussing
below only three points which
were not squarely addressed in
the
district court.
Some
of the
appeal are fairly debatable,
issues presented
but we see no reason
by the
to repeat
in our words explanations that have been ably provided by the
district court.
1.
continued
Plaintiffs argue on appeal that three plaintiffs who
working for Hygeia
until the date
options would have vested if
employ completed
that the
on which their
they had remained in Tambrands'
the requisite vesting period.
contractual
requirement of
employment with "the Company,"
subsidiaries," should
years'
continued
defined as "Tambrands and its
be understood
-2-2-
two
They assert
to
mean employment
by
Tambrands
and/or
the subsidiaries
it had
at the
time the
options were granted--not at the time of exercise.
This theory,
although mentioned in
the complaint,
was
not discussed at length by the magistrate judge, who directed
his
attention to
broader claim,
namely,
that the
triggered an acceleration of
the options.
that
fully preserved, at
the present theory was
sale
However, assuming
the end of
two
years the plaintiffs
Tambrands or
options
were no longer
working either for
a subsidiary of Tambrands,
lapsed under
the
and therefore their
contract, which
allowed exercise
"only during the continuance of that Participant's employment
by the Company."
2.
In
the
contract claims,
unjust
district
the
court,
in addition
plaintiffs pressed
enrichment and
quantum
meruit claims.
these latter claims
on their allegation
unusual efforts
support of
during
1989
and
in
1990 and
impliedly
promised, the
options.
On appeal,
as
reward
implied
result
of
contract,
They
sale of
deserve, or
acceleration
they have recast
express
that they had
the planned
to
of
based
made
Hygeia
were
their
this theory, arguing
that
their
contracts
were
impliedly
modified,
alternatively that Tambrands'
continuation of its
compensation programs
1989 and
during
incentive
either
estops
Tambrands from refusing acceleration or constitutes a
waiver
of any right to refuse acceleration.
-3-3-
1990
or
However, we agree
that
with the district court's
the plaintiffs could
not prove either
conclusion
that they could
reasonably have expected acceleration, or that the defendants
promised acceleration, in
We
think
that
this
exchange for their
conclusion
plaintiffs' modification,
well as the
asserted
in
supports
sales efforts.
dismissal
estoppel and waiver
of
arguments, as
implied contract and related claims more clearly
the
district
court
and
addressed
by
the
magistrate judge's opinion.
3.
policy
They
Finally, plaintiffs
considerations
cite an
Iowa
justify
contend on appeal
that public
accelerating their
case involving
somewhat similar
options.
facts,
Hilgenberg v. Iowa Beef Packers, Inc., 175 N.W.2d 353, 362-63

__________
_______________________
(Iowa
1970).
In
that case,
options to employees
before the options
court permitted
portion of
sold one
vested.
the
company that
of its plants
In
occurred after sale of
to new
owners
the subsequent lawsuit,
employees of
their options,
had promised
the plant
even though the
the plant.
to exercise
the
supposed vesting
The court
relied heavily
upon public policy.
The difficulty is that the present agreement is governed
by New York law
law
as
to
Massachusetts
as to the contract claims
noncontractual
claims.
cases that are cited
and our independent
The
New
to us are
research suggests that
-4-4-
and Massachusetts
York
and
not in point,
the case law
in
these two states
quite
as far
does not carry
as Hilgenberg.
__________
the public policy
See
___
Carlson v.
_______
argument
Viacom Int'l
____________
Inc., 566 F. Supp. 289, 290-91 (S.D.N.Y. 1983); McCone v. New

____
______
___
England Tel. & Tel. Co., 471 N.E.2d 47, 49-50 (Mass. 1984).
_______________________
Affirmed.
________
-5-5-

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USCA1 Opinion

NOT FOR PUBLICATION

CARL M. BERKE, ET AL.,

FOR THE DISTRICT OF MASSACHUSETTS

Boudin, Circuit Judge,

and Lynch, Circuit Judge.

Brettler, LLP were on consolidated briefs for appellants.

Roger E. Podesta with

whom Harry Zirlin,

Debevoise & Plimpt

consolidated brief for appellee.

April 24, 1997

Plaintiffs appeal from the district court's

summary judgment dismissal of their claims,

that stock options and other incentive compensation

accelerated--rather than forfeited--when

Sciences, Inc., the company

plaintiffs directly worked.

for which the

Plaintiffs dispute the district

challenge several discovery rulings.

the briefs and the

that the district court's thorough opinion correctly analyzed

the reasons given below, separately discussing

below only three points which

were not squarely addressed in

appeal are fairly debatable,

but we see no reason

in our words explanations that have been ably provided by the

Plaintiffs argue on appeal that three plaintiffs who

working for Hygeia

until the date

options would have vested if

they had remained in Tambrands'

the requisite vesting period.

employment with "the Company,"

defined as "Tambrands and its

options were granted--not at the time of exercise.

not discussed at length by the magistrate judge, who directed

the present theory was

years the plaintiffs

working either for

and therefore their

"only during the continuance of that Participant's employment

these latter claims

they have recast

that they had

this theory, arguing

alternatively that Tambrands'

Tambrands from refusing acceleration or constitutes a

of any right to refuse acceleration.

with the district court's

the plaintiffs could

not prove either

that they could

reasonably have expected acceleration, or that the defendants

exchange for their

estoppel and waiver

implied contract and related claims more clearly