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Cashman v. Bayland Buildings Inc.

United States District Court, E.D. Wisconsin

October 11, 2016



          William C. Griesbach, Chief Judge

         Plaintiff Michael R. Cashman filed a complaint alleging ERISA and state law claims against his former employer, Bayland Buildings, Inc.; Steve Ambrosius, Bayland's president; and Abraham Farley, its chief operating officer. Arising under federal law, the ERISA claims provide this Court with jurisdiction under 28 U.S.C. § 1331. The Court has supplemental jurisdiction over the state law claims under 28 U.S.C. § 1367. Defendants Bayland, Ambrosius, and Farley have filed a motion seeking summary judgment on all of Cashman's claims. For the reasons below, Defendants' motion will be granted with respect to Cashman's ERISA claims. With the federal claims gone, the Court will follow the general rule and decline to exercise jurisdiction over the state law claims, which will be dismissed without prejudice.


         Bayland, based in Hobart, Wisconsin, is a general contractor in commercial, agricultural, and industrial markets. Steve Ambrosius is the president of Bayland, and Abraham Farley is its chief operating officer. Bayland is employee-owned through an employee stock ownership plan (the Plan). Employees participating in the Plan receive stock in Bayland pursuant to the Plan's terms and conditions. The Plan identifies Bayland as the plan administrator but indicates Bayland may authorize an individual to act as the administrator on its behalf. (ECF Nos. 38-1 & 49-2.) Bayland has done so, and the Plan is administered by a third-party entity, Principal Financial Group. (Def.'s Proposed Findings of Fact (DPFOF) ¶ 6, ECF No. 36.) The Plan provides that “the Company shall determine the amount of any contribution made to the Plan” and allocates any contribution among qualifying participants based on “point determinations.” (ECF No. 38-1.)

         Cashman began working for Bayland as its vice president of sales in 2007. Cashman's 2007 employment agreement required that Bayland pay him a base salary, plus commission based on the price of each sales contract, as well as other benefits, including health insurance and inclusion in the Plan. (ECF No. 38-3.) In 2013, Bayland divided the sales department into two sectors: commercial sales and agricultural sales. Cashman became Bayland's vice president of commercial sales and signed a new employment agreement in 2013 reflecting the position change. (ECF No. 38-4.) The agreement incorporated a new commission formula, under which Cashman received commission on the net profit of all commercial sales and agricultural projects. Bayland remained obligated to pay Cashman a base salary, provide benefits, and include Cashman in the Plan. (Id.)

         Cashman's employment contract with Bayland was not for a set term. As a result, his employment was “at will”; Bayland was free to terminate Cashman's employment at any time as long as the termination was not contrary to a fundamental and well-defined public policy. Brockmeyer v. Dun & Bradstreet, 113 Wis.2d 561, 573, 335 N.W.2d 834 (1983). Bayland terminated Cashman's employment on March 26, 2015.

         Cashman claims that he was terminated in bad faith after he raised concerns about certain company expenditures for the private benefit of one of its officers. He also claims that he was not paid commissions and other compensation he had earned before his termination. Though somewhat lacking in detail, his complaint asserts eleven “claims for relief.” The first three seek relief under ERISA, and the remaining eight assert various claims under Wisconsin statutory and common law. See Compl. Counts 1-3 (ERISA), Count 4 (non-payment of wages under Wis.Stat. §§ 109.03 and 109.11), Counts 5-10 (breach of contract and alternative quasi-contractual claims), and Count 11 (breach of duty of good faith).

         The ERISA claims are based on an alleged attempt by Farley to bill the cost of a garage he had built for his own home to a company account. In November or December 2014, Cashman discovered that Farley billed materials for a garage built at his home to a Bayland project referred to as the “Koehne Chevrolet project.” (Pl.'s Proposed Findings of Fact (PPFOF) PPFOF ¶¶ 15, 17.) The Koehne Chevrolet project involved a contract Bayland had with Chade Koehne, the president of Koehne Buick-Pontiac-GMC, Inc., to construct a new automobile dealership in Marinette, Wisconsin. Cashman discussed Farley's conduct with Jeff Juse, the project's head estimator, in December 2014. (PPFOF ¶ 18.) Cashman contends that by billing expenses for his personal project to a company account, Farley decreased Bayland's profits and thereby negatively affected the Plan and its participants, including Cashman. Cashman claims Ambrosius, Farley, and Dan Verhagan, Bayland's chief financial officer, falsified Bayland records in billing the garage materials to the Koehne Chevrolet project and engaged in tax fraud. (PPFOF ¶¶ 30-34, 44.)

         Farley admits that he did track expenses for his garage to the Koehne Chevrolet project, but claims that by combining the purchase of the materials for his garage with those needed for the Koehn project, he saved money for both by getting a better price on a larger volume of materials. (Farley Dep. Tr. 35, ECF No. 53; Decl. of Abraham Farley ¶ 26, ECF No. 39.) The costs of material for his garage were not charged to or paid by Koehne, however, nor were they paid by Bayland, because Farley reimbursed Bayland for the materials by deducting $11, 522.74 from his end-of-the-year bonus. (DPFOF ¶ 54.)


         Summary judgment is appropriate when the moving party shows 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(a). All reasonable inferences are construed in favor of the nonmoving party. Foley v. City of Lafayette, 359 F.3d 925, 928 (7th Cir. 2004). The party opposing the motion for summary judgment must “submit evidentiary materials that set forth specific facts showing that there is a genuine issue for trial.” Siegel v. Shell Oil Co., 612 F.3d 932, 937 (7th Cir. 2010) (citations omitted). “The nonmoving party must do more than simply show that there is some metaphysical doubt as to the material facts.” Id. Summary judgment is properly entered against a party “who fails to make a showing sufficient to establish the existence of an element essential to the party's case, and on which that party will bear the burden of proof at trial.” Parent v. Home Depot U.S.A., Inc., 694 F.3d 919, 922 (7th Cir. 2012) (internal quotations omitted).


         A. ERISA

         ERISA is aimed at providing “‘a panoply of remedial devices' for participants and beneficiaries of [employer-provided] benefit plans.” Larson v. United Healthcare Ins. Co., 723 F.3d 905, 910 (7th Cir. 2013) (quoting Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 108 (1989)). Cashman asserts two kinds of ERISA claims: a claim for benefits due pursuant to 29 U.S.C. ยง ...

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