Zieche v. Burlington Resources Inc. et al
Filing
82
OPINION AND ORDER denying 72 Motion for Reconsideration; mooting 81 Motion for Hearing.(Signed by Judge Melinda Harmon) Parties notified.(htippen, )
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
GERALD P. ZIECHE,
Plaintiff,
VS.
BURLINGTON RESOURCES INC.
EMPLOYEE CHANGE IN CONTROL
SEVERANCE PLAN, et al,
Defendants.
§
§
§
§
§
§
§
§
§
§
CIVIL ACTION NO. H-07-3985
OPINION AND ORDER
Pending before the Court is Plaintiff Gerald P. Zieche’s motion for reconsideration (Doc.
72) of the Court’s opinion and order (Doc. 70) of March 1, 2011, granting summary judgment
for the Defendants Burlington Resources Inc. Employee Change in Control Severance Plan
(“Burlington”), ConocoPhillips, and Wachovia Bank, N.A. (“Wachovia”).
In his motion for reconsideration, Zieche contends that the Court’s decision was based on
“manifest errors of law” requiring reconsideration. Doc. 72 at 1. Regarding his claims against
ConocoPhillips, Zieche contends that the Court improperly ignored his requests for additional
discovery, incorrectly concluded that the increase in his bonus percentage and ConocoPhillips’
payment of Zieche’s bonus precluded a finding that he resigned from ConocoPhillips for “good
reason,” and ignored Zieche’s argument that ConocoPhillips reduced his position, thereby giving
him “good reason” to resign. Zieche also alleges that the Court improperly denied Zieche’s
motion for discovery on his claims for denial of severance benefits against Burlington and
Wachovia and applied an improper “abuse of discretion” standard to its review of Defendants’
allegedly conflicted employment decisions.
1 / 11
Upon consideration of the motion, Defendants’ responses, the record of the case, and the
applicable law, the Court finds that Zieche’s motion lacks merit and should be denied.
Background
The Court laid out a detailed discussion of the background of this case in its opinion and
order granting summary judgment for the Defendants. Relevant to this opinion on Zieche’s
motion for reconsideration is the fact that Zieche worked as a geologist for Burlington
Resources, Inc. from 1981 until he resigned in 2006. As an employee, Zieche participated in the
“Burlington Resources Inc. Employee Change in Control Severance Plan[;]. . . a plan established
by Burlington Resources Inc. for the benefit of its employees in a change of control of the
company, subject to the provisions of the ERISA.” Doc. 1 at 3.
In anticipation of the purchase of Burlington Resources by ConocoPhillips, Burlington
Resources amended the plan to bind a successor to the severance plan and to provide “that a
participant was entitled to a specified severance benefit if the participant’s employment was
terminated within two years after the change in control, subject to certain conditions” including
the participant’s resignation for “good reason.” Id. at 5. The plan defined “good reason” to
include “a reduction in the participant’s annual base salary or a material reduction in benefits
provided employees immediately prior to the change in control,” “a change in the participant’s
position or responsibilities which represents a substantial reduction in the participant’s position
or responsibilities immediately prior thereto, except in connection with the termination of the
participant’s employment...by the participant other than for good reason.”
On March 31, 2006, ConocoPhillips completed its purchase of Burlington. Id.
On March 28, 2006, ConocoPhillips sent Zieche a letter informing him of its desire to
retain him as an employee, that he would retained as a “Manager, Eastern U.S. Exploration” at
2 / 11
ConocoPhillips’ Salary Grade Level 19. In another letter sent the same day, “ConocoPhillips
informed Mr. Zieche that his salary was in excess of the maximum salary range for his assigned
grade level, making him ineligible for salary and certain benefit increases in subsequent years,
until the salary range was increased beyond his salary.” Id. at 6.
ConocoPhillips sent Zieche a letter on March 31, 2006 stating that ConocoPhillips would
pay Zieche “a retention bonus of $152,200 if he continued his employment for one year” and
included a provision stating that Zieche “still would be paid the bonus if he resigned from the
company for good reason.” Id. The letter defined “good reason” to include “any reduction in . . .
[Zieche’s] annual rate of base salary from . . . [his] annual rate of base salary” and “any
reduction in your target bonus opportunity percentage”. Id.
On August 15, 2006, Zieche gave ConocoPhillips notice of his resignation and applied
for benefits under the plan and for his retention bonus, claiming that he was terminating his
employment for “good reason” as defined in the plan and in the retention letter. Doc. 48-11 at 9
Wachovia, as trustee of the plan, denied Zieche’s application for severance benefits,
finding that Zieche had not suffered a material reduction in benefits or position and therefore had
not resigned for good reason under the terms of the plan. Doc. 48-15 at 4-5. ConocoPhillips
denied Zieche’s request for the retention bonus, finding that Zieche had not resigned for good
reason under the terms of the retention letter. Doc. 48-16 at 2-3.
On November 26, 2007, Zieche filed suit in this Court to recover severance benefits from
the plan under Section 502(a)(1)(B) of the Employee Retirement Income Security Act of 1974
(“ERISA”), as amended, 29 U.S.C. § 1132(a)(1)(B). He also alleged a breach of contract claim
against ConocoPhillips from its denial of his retention bonus.
3 / 11
On March 1, 2011, this Court granted summary judgment for the Defendants. Doc. 70.
Zieche now moves for reconsideration of that order. Doc. 72.
Standard of Review
Although Plaintiff fails expressly to invoke the provision governing motions for
reconsideration, such motions are generally considered cognizable under either Federal Rule of
Civil Procedure 59(e), as motions “to alter or amend judgment,” or under Rule 60(b), as motions
for “relief from judgment.” Lavespere v. Niagara Mach. & Tool Works, 910 F.2d 167, 173 (5th
Cir. 1990). “Under which Rule the motion falls turns on the time at which the motion is served.
If the motion is served within ten days of the rendition of judgment, the motion falls under Rule
59(e); if it is served after that time, it falls under Rule 60(b).” Id. (citing Harcon Barge Co. v. D
& G Boat Rentals, 784 F.2d 665, 667 (5th Cir.1986) (en banc). Here, Zieche filed his motion for
reconsideration on March 23, 2011, more than 10 days after March 1, the date this Court entered
final summary judgment for the Defendants. See Docs. 70, 71, 72. Because Zieche brought his
motion for reconsideration more than ten days after the entry of judgment, the Court properly
considers the motion under the stricter limitations of Rule 60(b).
Under Rule 60(b), the Court may grant relief from a final judgment when the movant
adequately shows: “(1) mistake, inadvertence, surprise, or excusable neglect; (2) newly
discovered evidence . . .; (3) fraud . . .; (4) [that] the judgment is void; (5) [that] the judgment has
been satisfied, released or discharged . . .; or (6) any other reason that justifies relief.” Fed. R.
Civ. P. 60(b). The district court enjoys considerable discretion when determining whether the
movant has satisfied these standards. Teal v. Eagle Fleet, Inc., 933 F.2d 341, 347 (5th Cir. 1991).
Zieche asserts he is entitled to reconsideration because the Court’s entry of summary
judgment for the Defendants “was based on manifest errors of law.” Doc. 72 at 1. The argument
4 / 11
falls under Rule 60(b)(1).
Zieche’s Claims Against ConocoPhillis
1. Zieche’s Request for Additional Time for Discovery
Zieche asserts that he “should have been permitted to conduct additional discovery on
matters material to the court’s consideration of the motions” before the Court ruled on
Defendants’ motions for summary judgment. Doc. 72 at 2. A Rule 56(f) continuance would have
enabled Zieche to conduct further discovery “to support . . . [his] contention that the scope of his
job responsibilities was reduced” and “to support . . . [his] contentions of conflict of interest and
the adverse effect on plaintiff’s pay and scope of responsibilities.” Id.
Zieche filed his complaint in the Southern District on November 26, 2007 (Doc. 1) and
produced a joint discovery and case management plan on April 1, 2008. Doc. 19. The first
scheduling order in this case, issued on April 1, gave the parties until October 3, 2008 to
complete discovery.Doc. 22. An amended scheduling order, issued on February 2, 2009, gave the
parties until May 22, 2009 to complete discovery. Doc. 27. After the case was reassigned to this
Court on September 17, 2009, a new scheduling order gave the parties until February 15, 2010 to
complete discovery and March 12, 2010 to file dispositive motions. Doc. 45.
Despite the lengthy period available in which to conduct discovery, Zieche alleges that he
“timely served discovery on all defendants, but agreed to defer the responses pending efforts at
[non-judicial] resolution” (Doc. 54 at 12) and that the Defendants therefore did not respond to his
discovery requests “until the period March 1 to March 10, 2010.” Id.
Zieche did not file a
motion to compel discovery prior to or contemporaneously with his response to Defendants’
motions for summary judgment. Zieche asserted in his responses to the Defendants’ motions for
summary judgment and again in his motion for reconsideration that the delay in Defendants’
5 / 11
responses entitled him to a continuance under Rule 56(f).
“Rule 56(f) authorizes a district court to ‘order a continuance to permit affidavits to be
taken or depositions to be taken or discovery to be had,’ if the non-movant files affidavits
showing that he or she ‘cannot for reasons stated present by affidavit facts necessary to justify
the party's opposition.’” Adams v. Travelers Indem. Co. of Connecticut, 465 F.3d 156, 162 (5th
Cir. 2006) (quoting Wichita Falls Office Assoc. v. Banc One Corp., 978 F.2d 915, 919 (5th
Cir.1992)).
To be entitled to a continuance, the non-movant must show with specificity (1) why he
needs additional discovery and (2) how that discovery will create a genuine issue of material
fact. The non-movant “may not simply rely on vague assertions that additional discovery will
produce needed, but unspecified, facts in opposition to summary judgment.” Access Telecom,
Inc. v. MCI Telecommunications Corp., 197 F.3d 694, 720 (5th Cir. 1999) (citing Daboub v.
Gibbons, 42 F.3d 285, 288 (5th Cir. 1995)).
In support of his motion for continuance under Rule 56(f), Zieche submitted the affidavit
of his attorney, David T. Lopez, in which Mr. Lopez requests additional time to “conduct any
depositions, and obtain affidavits responding to the issues raised in the motion.” Doc. 54 at 15
(emph. added). The discovery, “would [have] include[d] obtaining affidavits from Zieche’s peers
and supervisor at Burlington and deposing [ConocoPhillips].” Id. The affidavit did not identify
on which “issues” the requested discovery would create a genuine issue of material fact nor the
allegations that would be supported by discovery evidence; instead it contained vague assertions
of unspecified facts. Such general statements do not satisfy the specificity requirements of Rule
56(f).
Because Zieche was not entitled to a Rule 56(f) continuance, the Court’s failure to grant
6 / 11
his request for a continuance was not a clear legal error requiring reconsideration.
On August 2, 2011 Zieche filed an Advisory to the Court, which indicated that the Fifth
Circuit Court of Appeals had just issued an opinion that supported his position on the discovery
issue. (Doc. 77). The issue in this case was one of timing. Should Plaintiff be allowed time to
conduct discovery before being required to respond to the Defendants’ motions for summary
judgment. The new Fifth Circuit case, Crosby v. Louisiana Health Services & Indemnity Co.,
647 F.3d 258 (5th Cir. 2011) was a question of whether the magistrate judge had abused her
discretion in limiting the scope of the plaintiff’s discovery an ERISA case. Judge DeMoss
found, “The magistrate judge. . .denied Crosby’s motion based on an erroneous view of the
scope of admissible and discoverable evidence in ERISA actions.” The abuse of discretion
prejudiced Crosby’s ability to establish certain admissible facts that were outside the
administrative record.
Crosby, 647 F.3d at 264. The Crosby case has no bearing upon the
discovery issue in the instant case.
2. Zieche’s Purported Salary Reduction
Zieche contends that the Court erred when it concluded that “there was no reduction in
Zieche’s salary or bonus percentage” that would constitute “good reason” for his resignation.
Doc. 70 at 8, 9. The Court relied on the fact that Zieche received “his full 2006 performance
bonus” after he began working at ConocoPhillips and that the bonus percentage increased from
30% in 2005 to 40% in 2006 as proof that Zieche did not suffer a reduction in salary.
Zieche contends that an increase in his bonus is irrelevant to a determination of whether
his salary was reduced because a “bonus is not part of the salary,” but is instead “something in
addition to what is expected or strictly due.” Doc. 72 at 4. Additionally, Zieche alleges that “the
[C]ourt’s analysis ignores the specific provisions of the retention agreement,” which defines
7 / 11
“good reason” to include “any reduction from your annual rate of base salary.” Id.
Initially, although Zieche alleges that ConocoPhillips reduced his salary, he introduced
no summary judgment evidence to support this contention. In his Response to ConocoPhillip’s
Motion for Summary Judgment, Zeiche repeatedly asserts that, in his new position at
ConocoPhillips, he would “not be eligible for annual merit salary increases” as he had
previously received at Burlington. Doc. 54 at 4 (emph. added). The summary judgment evidence
before the Court included Zieche’s deposition, in which he admitted that his salary “remained
the same . . . up to the time [he] resigned from ConocoPhillips.” Doc. 48-1 at 50 (emph. added).
Nevertheless, Zieche argues that the Court unnaturally should read the word “reduce” in the
retention agreement to mean “not increase,” rather than interpreting the word according to its
plain meaning. The Court does not agree with this reasoning, and Zieche has introduced no
evidence to convince the Court otherwise.
Likewise, Zieche’s argument that his bonus was “reduced” because “the effective
diminution of plaintiff’s ConocoPhillips salary . . . necessarily also resulted in a lower bonus
payment” (Doc. 72 at 5) is unavailing. Whether Zieche’s bonus percentage increased or
remained the same during his employment with ConocoPhillips, Zieche did not and cannot point
to any evidence in support of his claim that his bonus was reduced. He cannot, therefore,
demonstrate that the Court’s previous conclusion constituted a manifest error of law that would
entitle him to reconsideration of the order.
3. Zieche’s Alleged Reduction in Position
In support of his claims that ConocoPhillips reduced his pay, Zieche claimed that “the
reductions which warranted . . . [his] resignation were not accidental or unintentional.” Doc. 54
at 10. In his motion for reconsideration, Zieche asserts that the Court’s failure to address his
8 / 11
claims that ConocoPhillips “intentionally placed . . . [him] in a position that improperly was
lower than that to which . . . [he] had been promoted at Burlington” justifies reconsideration.
Doc. 72 at 5, 6.
It does not appear that Zieche alleged that the reduction in position was, by itself, a
violation of the retention agreement. Nor could he, as the retention agreement does not list
“reduction in position” as “good reason” for resignation. Instead, Zieche alleged that the
purported demotion evidences ConocoPhillip’s intent to reduce Zieche’s salary.
Because the Court correctly determined that ConocoPhillips did not reduce Zieche’s
salary, ConocoPhillip’s intent is irrelevant. The Court’s previous failure to address Zieche’s
contention that ConocoPhillips intentionally placed Zieche in a position lower than the one had
held at Burlington was not in error.
Zieche’s Claims Against Burlington and Wachovia.
1. Applicable Standard of Review
Zieche contends that the Court improperly applied an “abuse of discretion” standard
when reviewing Wachovia’s denial of Zieche’s severance benefits. Doc. 72 at 6. Zieche raised
this concern in his original complaint (Doc. 1 at ¶¶ 2.3, 4.28-31) and again in his response to
Wachovia and Burlington’s motion for summary judgment. Doc. 55. In his response, Zieche
requested a continuance under Rule 56(f) for additional time to conduct discovery relating to this
issue; specifically, discovery of financial information which Zieche had previously requested and
to which Wachovia had objected. Doc. 55 at 4 (“Wachovia objected to providing information
about financial dealings with [ConocoPhillips].”).
As the Court stated above, motions for continuance under Rule 56(f) must show a need
for specific additional information creating a genuine issue of material fact. Here, as above, the
9 / 11
affidavit attached to Zieche’s motion did no more than advance vague assertions of unspecified
facts that failed to meet the standard of Rule 56(f). Additionally, Zieche did not file a motion to
compel discovery of the material to which Wachovia and Burlington objected that would
demonstrate that he had been diligently conducting discovery efforts. He was not, therefore,
entitled to a continuance under Rule 56(f).
Consistent with Supreme Court precedent established in Firestone Tire and Robber Co. v.
Bruch, this Court considered the denial of benefits under an abuse of discretion standard. 489
U.S. 101, 110, 114 (1989) (“Trust principles make a deferential standard of review appropriate
when a trustee exercises discretionary powers.”). Assuming a conflict of interest did exist, which
the record before the Court did not clearly reflect, the Court must consider the conflict as a
“factor in determining whether there is an abuse of discretion.” Metropolitan Life Ins. Co. v.
Glenn, 554 U.S. 105, 108 (2008). On review of the summary judgment evidence before it, the
Court determined that “there was no material reduction in Zieche’s position, responsibilities, or
benefits, as of the date of Zieche’s voluntary termination.” Doc. 70 at 10. Zieche has identified
no reason why the single “factor” would be dispositive against that evidentiary record. The
Court’s finding that Wachovia did not abuse its discretion when it denied Zieche’s claims was
not in error.
Conclusion
Because Zieche has failed to demonstrate sufficiently compelling reasons for
reconsideration under Rule 60(b), the Court hereby
ORDERS that Plaintiff Gerald P. Zieche’s Motion for Reconsideration (Doc. 72) is
DENIED. Plaintiff’s motion for an oral hearing (Doc. 81) is MOOT.
10 / 11
SIGNED at Houston, Texas, this 6th day of March, 2012.
___________________________________
MELINDA HARMON
UNITED STATES DISTRICT JUDGE
11 / 11
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?