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Greishaw v. Base Manufacturing

February 21, 2008

DONALD E. GREISHAW, PLAINTIFF,
v.
BASE MANUFACTURING, STEVE SOUTH, AN INDIVIDUAL, AND B. HARRY STRACK, JR., AN INDIVIDUAL, DEFENDANTS.



The opinion of the court was delivered by: McLAUGHLIN, Sean J., J.

MEMORANDUM OPINION

Plaintiff, Donald E. Greishaw, has filed suit against Defendant Base Manufacturing, its President, Steve South and Vice-President, B. Harry Strack, Jr., seeking to recover sales commissions and/or compensation allegedly earned during his previous employment with Base. Presently pending before the Court is Defendants' Motion for Summary Judgment.

I. BACKGROUND

Base is a manufacturer of industrial shelving located in Monroe, Georgia. See Second Amended Complaint ¶ 2. Plaintiff, a resident of Pennsylvania, was hired by Base on December 19, 2002 as an "outside" salesperson. Id. at ¶ 9. Plaintiff testified that most of his work was accomplished over the telephone, and that he spent most of his days in his "home office" handling phone calls and talking to prospective clients from approximately 8:00 a.m. until 5:00 p.m. Def. Ex. B, Greishaw Dep. p. 19. He also spent time in the field however, traveling and meeting with customers regarding their needs and projects. Id.

When Plaintiff was initially hired, Defendant South orally agreed to pay Plaintiff a $40,000.00 annual salary and 1.5% commission on gross sales. Def. Ex. B, Greishaw Dep. p. 12; Def. Ex. K, South Dec. ¶ 7. On March 1, 2004, Plaintiff received an e-mail from Defendant Strack informing him that his compensation structure had been changed to a commission only basis, with a draw of $36,000.00 annually and commissions of 30% on gross profits of sales. Pl. Ex. F, Greishaw Dep. pp. 16-17; Def. Ex. F, Strack Dep. p. 6. Under this new structure, Plaintiff had no guaranteed minimum salary. Id.

In either March 2004 or shortly thereafter, Base also began deducting expenses incurred by Plaintiff as an offset against his commission. Pl. Ex. C, Strack Dep. pp. 6; 10. According to Defendants, Plaintiff's commission structure was further modified in August 2004 to reflect an increase in the cost of installation and outside purchases by 15% to account for overhead and profit. Pl. Ex. C, Strack Dep. p. 10; Def. Ex. O, Strack Dec. ¶ 16. Plaintiff contends that he was unaware that any such deductions from gross profits had been made until the discovery phase of this lawsuit. Pl. Ex. A, Greishaw Aff. ¶ 7.

In April 2005, Base sent Plaintiff a commission check for $40,000.00. Pl. Ex. F, Greishaw Dep. p. 38. Defendant Strack sent the check because he believed that Plaintiff was owed "at least" that amount by Base at the time. Pl. Ex. C, Strack Dep. pp. 11-12. Shortly thereafter, Plaintiff had a telephone conversation with Defendant Strack regarding the amount of the check. Plaintiff recounted the following:

Harry called me up. And he said -- you know, asked how I was doing. Harry and I were friends. And we were joking around a little bit. And then he goes, what do you think of the check. And I said, that is very nice, thank you very much, I appreciate that. And he goes, you're welcome. And he said, what do you think of the size. And I go, that's very nice. And I said, it looks to me like it equates to about 5 percent of sales. And he says, yes, you can use that.

Def. Ex. B, Greishaw Dep. p. 43.*fn1 Defendants contend that subsequent to September 1, 2005, Plaintiff's performance began to deteriorate and as a result, he was terminated effective July 15, 2006. Def. Ex. D, South Dep. p. 14; Plaintiff's Second Amended Complaint ¶ 21.

Following notification of his termination, Plaintiff telephoned Gail Sliger, an employee of Base who worked in purchasing and accounts payable. Pl. Ex. F, Greishaw Dep. pp. 77-78; Def. Ex. I, Sliger Dep. p. 4. She informed him that his sales between October 1, 2005 and July 7, 2006 were over $6 million. Id. at p. 78. Sliger testified that she found the number on the computer through trial and error, located under a screen entitled "sales, year to date." Pl. Ex. I, Sliger Dep. p. 6. Plaintiff subsequently contacted Donna Powell, Base's customer service and inside sales representative, and requested his sales figures. Pl. Ex. F, Greishaw Dep. p. 80. According to Plaintiff, Powell informed him that she was unable to access the data Sliger had previously accessed. Id. at p. 81. Defendants contend that Sliger's statement was demonstrably incorrect. Pl. Ex. B, South Dep. p. 38. According to Defendant Strack, the "year to date" sales information represented Plaintiff's entire cumulative sales with Base, and not his sales between November 1, 2005 and July 15, 2006. Def. Ex. O, Strack Dec. ¶ 8. Defendants claim that Plaintiff's sales were as follows:

1/1/03 - 10/31/03: $1,144,995.84 11/1/03 - 10/31/04: $2,070,368.49 11/1/04 - 10/31/05: $756,998.78 11/1/05 - 10/31/06: $2,232,965.31

Grand Total: $7,105,328.42

Def. Ex. E, p. 20. Moreover, Defendants contend that Sliger, by virtue of her position as an accounts payable clerk, was not authorized to speak on behalf of the company on matters relative to employee compensation. See Hearing on Motions Tr. pp. 3; 16-18 [Doc. No. 68].

Based on Sliger's representation, Plaintiff claims he has raised a triable issue of fact as to whether he is entitled to commissions on over $6 million between October 1, 2005 and July 7, 2006. He also contends that there are other examples of underpayment including $388,907.46 in additional sales for two companies, Perkins and Marmaxx (Pl. Ex. H), underpayment of commissions in the amount of $12,328.74 for the period January 2003 through February 2004 (Pl. Ex. E), as well as a failure to have credited him with various sales where he was not directly involved in the sale, despite alleged representations by Defendant it would do so. Pl. Ex. A, Greishaw Aff. ¶ 18; Pl. Ex. H; Pl. Ex. J, Powell Dep. p. 15. Defendants deny that Plaintiff is due any commissions and has counterclaimed against him in the amount of $45,900.47 representing draws allegedly in excess of commissions earned. Def. Ex. O, Strack Dec. ¶ 12.

Plaintiff has filed suit alleging violations of the Pennsylvania Wage Payment and Collections Law ("WPCL"), 43 P.S. § 260 (Count I); wrongful termination (Count II); fraud (Count III); violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 203(e)(1) (Count IV); and violations of the Pennsylvania Minimum Wage Act ("PMWA"), 43 P.S. § 333.103(h) (Count V). As indicated, presently pending before the Court is Defendants' motion for summary judgment on Counts I through IV [Doc. No. 49].*fn2

II. STANDARD OF REVIEW

Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law."

Fed.R.Civ.P. 56(c). In order to withstand a motion for summary judgment, the non-moving party must "make a showing sufficient to establish the existence of [each] element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). In evaluating whether the non-moving party has established each necessary element, the Court must grant all reasonable inferences from the evidence to the non-moving party. Knabe v. Boury Corp., 114 F.3d 407, 410, n.4 (3d Cir. 1997) (citing Matsuchita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986)). "Where the record taken as ...


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