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Integrated Service Solutions, Inc. v. Rodman

April 29, 2009


The opinion of the court was delivered by: David R. Strawbridge United States Magistrate Judge


Plaintiff Integrated Service Solutions, Inc. ("ISS") brought this action against a former employee, Defendant Dennis M. Rodman ("Rodman"), asserting various claims arising from alleged unauthorized use of ISS's email and computer systems and alleged misappropriation and dissemination of confidential and proprietary information. Rodman then brought a counterclaim against ISS seeking to recover payments allegedly still due to him pursuant to his employment contract. ISS President Joseph Uricchio ("Uricchio") was also named as a third-party defendant on that claim. By stipulation and consent of the parties, accepted and approved by the Honorable Anita B. Brody, the case was referred to this Magistrate Judge "for all pre-trial rulings." (Doc. 44 at 1, ¶ 1; see Docs. 45 & 51.)*fn1 Presently before the Court for decision are: (1) ISS's motion for voluntary dismissal; (2) Rodman's affirmative motion for summary judgment as to his counterclaim and third party suit; and (3) ISS and Uricchio's motion for summary judgment as to Rodman's counterclaim and third party suit. While not presented in a separate motion, Rodman has also asked the Court to impose sanctions against ISS and its counsel, citing to Rule 11.*fn2 For the reasons set forth below, we will grant ISS's motion for summary judgment, deny Rodman's motion and his request for Rule 11 sanctions, and grant ISS's motion for voluntary dismissal on the terms we consider appropriate.


ISS provides equipment calibration, validation, and regulatory services to pharmaceutical and biotechnology companies located in the mid-Atlantic region. (See, e.g., Am. Compl. [Doc. 31] at 1, ¶ 1.) ISS tendered to Rodman an offer of employment as a field service technician on June 13, 2001, the terms of which were set forth in an offer letter. (ISS Mot. Summ. Jmt. [Doc. 88 ] ¶ 3 & Ex. C; Rodman Mot. Summ. Jmt. [Doc. 92] ¶ 1.) The offer stated that Rodman would be "eligible for" an incentive program (the "Rewards Program") "based on contract and project lead generation" and that the incentive payments were "payable upon closure of business (i.e., purchase order)" and paid out on a quarterly basis. (Id.)

Rodman received three payments under the ISS Rewards Program, the last on July 12, 2002.*fn4 (ISS Mot. Summ. Jmt. [Doc. 88] ¶ 6 & Ex. G.) At some point, ISS decided to terminate the Rewards Program and discontinued it effective December 31, 2003. (Id. ¶ 4 & Ex. H (Uricchio Aff. ¶ 3); Rodman Mot. Summ. Jmt. [Doc. 92] ¶ 3.) ISS did not present Rodman with any documentation seeking his acquiescence to the discontinuation of the Rewards Program, nor did it provide employees with any written announcement about the discontinuation of the program. (Rodman Mot. Summ. Jmt. [Doc. 92] ¶¶ 3, 5; ISS Ans. to Mot. Summ. Jmt. [Doc. 95] ¶¶ 3, 5.) Rodman continued to work as an employee of ISS until ISS terminated his employment on September 29, 2006. (ISS Mot. Summ. Jmt. [Doc. 88] ¶ 13; Rodman Mot. Summ. Jmt. [Doc. 92] ¶ 6.)

It is uncontested that the last payment made to any ISS employee pursuant to the Rewards Program was made on January 9, 2004 for earnings under the program in the last quarter of 2003. (ISS Mot. Summ. Jmt. [Doc. 88] ¶ 5 & Ex. H (Uricchio Aff. ¶¶ 4-5).) ISS did not consider Rodman to have referred, suggested, or identified any leads for new business after 2002. (ISS Mot. Summ. Jmt. [Doc. 88] ¶ 7 & Ex. H (Uricchio Aff. ¶ 7).) Rodman has not asserted otherwise. The parties appear to dispute, however, whether Rodman requested or demanded any additional compensation during the remainder of his tenure at ISS pursuant to the Rewards Program. ISS, through its President, Uricchio, asserts that Rodman did not seek any payment under the program after July 2002. (ISS Mot. Summ. Jmt. [Doc. 88] ¶ 8 & Ex. H (Uricchio Aff.) ¶ 8.) Rodman, however, contends that he "continually brought to [his] immediate manager's attention . . . the failure of Mr. Uricchio to uphold his responsibility to pay rewards" following the discontinuation of the Rewards Program. (Rodman Mot. Summ. Jmt. [Doc. 92] ¶ 5.) While Rodman's papers speak of his complaint that rewards were not being paid, he has not presented any evidence of any application made by him, directed to his manager, Uricchio, or anyone else at ISS, for an incentive payment based upon the criteria of the Rewards Program as described in his offer letter.

ISS filed a complaint against Rodman on August 29, 2007, which it amended on February 12, 2008. (Docs. 1, 31.)*fn5 ISS's action alleged violations of the Computer Fraud and Abuse Act, tortious interference with contract, conversion, misappropriation of trade secrets, and breach of fiduciary duty. Rodman first asserted a claim against ISS for unpaid incentive payments when he filed his answer to the complaint on October 1, 2007. (Doc. 11.) When he filed an amended answer and counterclaim on March 3, 2008, he also brought a claim against Uricchio. (Doc. 36.) The counterclaim includes a count against ISS for breach of contract on the theory that Rodman was entitled under the terms of his "employment contract" to be compensated for generating contract and project leads for ISS and that ISS's failure to have paid him incentive payments due under that contract constituted a breach. He also brought counts against ISS and Uricchio individually under the Pennsylvania Wage Payment and Collection Law, 43 Pa. Cons. Stat. Ann. §§ 260.1, et seq. (the "WPCL"), asserting that the unpaid incentive commissions constitute earned and unpaid "wages."

The matter proceeded to discovery, which involved, inter alia, the depositions of Rodman and Uricchio and the forensic examination of at least one computer to which Rodman had access during the period of his alleged misconduct. In the context of a discovery dispute, the Court also heard testimony on June 17, 2008 from Catherine Peetros, ISS's Director of Marketing and Business Development, concerning the circumstances under which the alleged improprieties engaged in by Rodman came to light. The discovery period closed on November 14, 2008. (Doc. 86.)

Rodman has moved for summary judgment on his counterclaim and third party complaint and seeks entry of an award of $12,500 "in unpaid bonus pay," $85,075 "in attorney's fees," and any other "penalties, damages, etc." that the Court may deem appropriate under the WPCL.*fn6 (Rodman Mot. Summ. Jmt. [Doc. 92] ¶ 8.) ISS and Uricchio jointly have also moved for summary judgment as to Rodman's counterclaim and third party complaint. Prior to the filing of either of the summary judgment motions, ISS suggested to Rodman that they stipulate to a dismissal of the entire action, as ISS determined that it did not wish to further continue the litigation in light of "substantial additional costs involved." (Mot. Vol. Dism. [Doc. 87] ¶¶ 5, 7.) Because Rodman did not accept that suggestion, ISS filed a formal motion seeking the dismissal of its own complaint. In response, Rodman suggests that ISS's complaint should not be dismissed until sanctions in the amount of $85,075 - "the legal fees generated by Dennis Rodman as of January 5, 2009" - are entered pursuant to Rule 11 against ISS and its counsel. (Resp. to Pl.'s Mot. Vol. Dism. [Doc. 93] at 9.)*fn7

We first address the cross-motions for summary judgment on Rodman's counterclaim and then address the issue of the propriety of ISS's request that the Court dismiss, without prejudice, its amended complaint.


A. Summary Judgment Standards

Summary judgment is appropriate "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 a judgment as a matter of law." Fed. R. Civ. P. 56(c). In conducting this analysis, the court must view all reasonable inferences drawn from the facts in the light most favorable to the non-moving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-88 (1986). An issue is "genuine" under Rule 56(c) if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is "material" if it might affect the outcome of the case under governing law. Id. "[T]he mere existence of some alleged factual dispute between the parties," however, does not preclude summary judgment; rather, "the requirement is that there be no genuine issue of material fact." Id. at 247-48 (emphasis in original).

To support a summary judgment motion, the moving party may attach affidavits or otherwise identify supporting materials in the pleadings, disclosures, or discovery materials on file in the action. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). "To prove that no genuine factual issues exist, a movant must present a factual scenario without any 'unexplained gaps.'" National State Bank v. Federal Reserve Bank of N.Y., 979 F.2d 1579, 1581 (3d Cir. 1991) (citing Adickes v. S.H. Kress & Co., 398 U.S. 144, 158 (1970)). The party bearing the ultimate burden of proof on the claim at trial has a more stringent burden of production when it seeks summary judgment: its motion must establish the absence of a genuine factual issue. National State Bank v. Federal Reserve Bank of N.Y., 979 F.2d 1579, 1582 (3d Cir. 1991). By contrast, when a party that does not bear the burden of persuasion at trial seeks summary judgment, it need only point to or illustrate an absence of evidence supporting the case of the non-moving party. Celotex, 477 U.S. at 323-25. Once a moving party has satisfied its burden of production, the burden shifts to the non-movant to show, by setting forth specific facts, that there is a genuine issue for trial. Anderson, 477 U.S. at 250. The evidence to which the non-moving party points must be more than "merely colorable"; if it is not "significantly probative," that is, sufficient evidence for a jury to return a verdict in favor of that party, summary judgment may be granted. Id. at 249-50. Ultimately, the inquiry is "whether the evidence presents a 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." Id. at 251-52.

B. Breach of Contract Claim

1. The parties' contentions

In the first count of his counterclaim, Rodman contends that he accepted employment with ISS effective July 2, 2001 (his first date of employment) "pursuant to the Employment Contract," that is, the letter dated June 13, 2001 from Uricchio to Rodman describing certain terms of employment, which Rodman accepted with his signature, also dated June 13, 2001. (Am. Countercl. [Doc. 36] ¶ 1. See also Ans. to Am. Compl. [Doc. 36] ¶ 6 (defining "Employment Contract" as June 13, 2001 letter appended thereto as Exhibit A).) After identifying Rodman's initial position, anticipated start date, base compensation rate, and describing his car allowance, the Employment Contract continued:

You will be eligible for our REWARDS incentive program based on contract and project lead generation. Rewards are payable upon closure of business (i.e. purchase order). These will be paid on a quarterly basis. The pay out is at a rate of 1.25% of the order value.

This program covers new contract leads, and projects (includes labor, equipment and materials). It excludes routine corrective maintenance labor and parts. (Id. at Ex. A.) Rodman contends that under the terms of this paragraph of the Employment Contract, he "was to be compensated by [ISS] for generating contract and project leads for [ISS]" and that in detrimental reliance upon this provision, he "generated substantial contract and project leads for [ISS]" at sixteen specified client sites. (Am. Countercl. [Doc. 36] ¶¶ 2, 4.) He contends that ISS breached the Employment Contract "by failing and refusing to pay to [Rodman] the incentive payments earned under the Employment Contract." (Id. ¶ 5.) In contrast to his counseled amended counterclaim, however, in his pro se motion for summary judgment, Rodman contends that the Rewards Program was not only related to "new contract and project lead generation" but also constituted "a reward for completing projects on time and efficiently." (Rodman Mot. Summ. Jmt. [Doc. 92] ¶ 2.) This appears to be consistent with his deposition testimony reflecting his asserted understanding that the Employment Contract entitled him to a bonus of 1.25% of his individual billings upon completion of a project and that it represented payment for his "successfully completing" a project. (See, e.g., Rodman Dep. at 80-84, appended to ISS Mot. Summ. Jmt. [Doc. 88] as Ex. I.) Because the position Rodman held with ISS "was based solely on project work," he further contends that he was "entitled [to] the rewards for the duration of [his] employment with [ISS]." (Doc. 92 ¶ 2.) It is apparent, therefore, that Rodman is not now prosecuting a claim based on new business that he may have successfully directed to ISS but rather based on his performance in engagements generated by others.

ISS contends that the Employment Contract provided for a reward only in the case of leads for new contracts or projects and that the payment would be made upon closing of the new order, not when work on the project was completed. It asserts that Rodman's claim as currently postured fails because it is based on a faulty reading of the Contract. (Br. in Supp. of ISS Mot. Summ. Jmt. [Doc. 88] at 6-7.) Alternatively, ISS contends that there was no breach of contract because it retained the ability, as the employer in an at-will employment relationship, to modify the terms of the employment relationship. (Id. at 7 (citing Trainer v. Laird, 183 A. 40 (Pa. 1936), for proposition that a contract of hiring can be modified without limitation by employer or employee). It contends that its discontinuation of ...

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