Meade v. A.B. Prop. Servs., Inc.

JAMES F. MEADE, Plaintiff, v. A.B. PROPERTY SERVICES, INC. d/b/a Happy Floors, Defendant.

Civil Action No.: 4:14-cv-2947-RBH-TER

UNITED STATES DISTRICT COURT DISTRICT OF SOUTH CAROLINA FLORENCE DIVISION

January 14, 2016

REPORT AND RECOMMENDATION

I. INTRODUCTION

This action arises out of Plaintiff's termination with Defendant. Plaintiff alleges that Defendant terminated his employment in violation of the Americans with Disabilities Act (ADA), 42 U.S.C. § 12101, et seq. Plaintiff originally filed this action in the Horry County Court of Common Pleas on June 25, 2014. Defendant removed it to this court on July 24, 2014, pursuant to 28 U.S.C. § 1331. Presently before the court is Defendant's Motion for Summary Judgment (Document # 33). After an extension of time, Plaintiff timely filed his Response (Document # 40). All pretrial proceedings in this case were referred to the undersigned pursuant to the provisions of 28 U.S.C. § 636(b)(1)(A) and (B) and Local Rule 73.02(B)(2)(g), DSC. This report and recommendation is entered for review by the district judge.

II. FACTS

A. Defendant Happy Floors

Defendant is a Florida corporation with its principal place of business in Miami, Florida. Defendant's Local Rule 26.03 Answers to Interrogatories (Document # 8) p. 1. Elie Elbaz and Sol Bonan are the principal owners and officers of the company. Def. Dep.¹ 10-11 (Ex. 2 to Pl. Resp.). Elbaz started the company and is in charge of "everything" concerning the company. Def. Dep. 9; 101. Defendant is engaged in the business of selling tile to customers. Def. Dep. 15-16. Defendant imports tile from Italy and Spain, and sells it to customers located primarily in the United States. Def. Dep. 15-19. Defendant sells tile to customers through two different sales models: retail sales and Architecture and Design (A&D) sales. Pl. Dep. 45-54, 65-67, 121 (Ex. 1 to Pl. Resp.); Def. Dep. 20- 25.

In the retail sales model, sales representatives for Defendant travel to showrooms that sell tile directly to consumers. Pl. Dep. 45-47; Def. Dep. 20-22. Defendant refers to the showroom as a "dealer," and the dealer or showroom is Defendant's customer in the retail sales model. Def. Dep. 20-22. Once the Defendant sales representative arrives at a showroom, he or she meets with the decision-makers, educates them about Defendant's tile, and attempts to place a display in the showroom. Pl. Dep. 46-47. If a consumer purchases Defendant's tile from the showroom, Defendant makes money from the sale. Pl. Dep. 48.

In June or July of 2011, Elbaz decided to invest in developing the A&D sales model. Def. Dep. 33, 58-59, 61. In the A&D sales model, Defendant's sales representatives travel to architecture firms to meet with architects and designers, who make specifications for construction projects. Pl. Dep. 48-49, 65-67. During these meetings, Defendant sales representatives provide information about Defendant's tile, show samples of Defendant's tile, and attempt to leave architectural binders with the firm, which contain samples of Defendant's products. Pl. Dep. 48-50, 53-54. The hope is that an architect or designer will specify Defendant's tile for an upcoming construction project. Pl.Dep. 53-54, 65-67; Def. Dep. 24-25. If so, the specification for Defendant's tile is included in the plans for the project. Pl. Dep. 50-51, 65-66. Then, once the project is awarded to a general contractor, a subcontractor purchases the tile directly from Defendant. Pl. Dep. 50-51, 121. Defendant makes money when the subcontractor purchases the specified tile from Defendant. Def. Dep. 50-51, 121.

B. Plaintiff's Employment with Defendant

In the summer of 2011, James Nowicki, Defendant's national sales manager, began discussing A&D employment with Plaintiff.² Prior to Plaintiff being hired, he had four discussions with Nowicki regarding the concept of an A&D sales division. Pl. Dep. 126-27. After the third conversation, he sent an email to Nowicki, dated June 29, 2011, in which he stated, "I realize everything has to make 'good business sense' for the owners and management team" with respect to Defendant hiring him and developing the "A&D segment of the business." Pl. Dep. 125-27; Email from Plaintiff dated June 29, 2011 (Ex. to Def. Motion). According to Elbaz, during the process of interviewing Plaintiff, Plaintiff requested that he give him one year to prove himself and the A&D division. Def. Dep. 33, 37.

Defendant initially focused the A&D department in the South Florida market, "from Orlando, south." Def. Dep. 60. Later, Defendant decided to expand the A&D division nationwide. Def. Dep. 60-61. Defendant hired Plaintiff on September 1, 2011. Pl. Dep. 96. Plaintiff testified that Defendant hired him as A&D manager. Pl. Dep. 96. Defendant testified that it hired him as an A&Dsalesman who the company was grooming to be an A&D manager after he developed the area and was capable of bringing in revenue. Def. Dep. 33, 93. In fact, Plaintiff was the first A&D employee Defendant hired after deciding to take the program nationwide. Def. Dep. 96-97. According to Defendant, the geographic sales area of the nationwide A&D department was "[a]nywhere we can get a sale," and Plaintiff's sales territory was "[t]echnically everywhere." Def. Dep. 61, 95.

Plaintiff worked from home in Myrtle Beach, South Carolina when not traveling on A&D business. Pl. Dep. 102-03. From home, Plaintiff scheduled and participated in teleconferences with the A&D sales force. Pl. Dep. 103-04. Plaintiff also contacted architectural firms to schedule upcoming meetings for he and the A&D sales force. Pl. Dep. 103-04, 107. Defendant never provided Plaintiff with any sales quotas or any numerical sales expectations of any kind during his time as A&D manager. Pl. Dep. 69; Def. Dep. 89. Furthermore, Defendant never informed Plaintiff that either he or the A&D Department would be subject to any type of review, annual or otherwise. Pl. Dep. 69, 145. Plaintiff admitted that he never knew whether the A&D sales division was, in fact, profitable during his management/employment. Pl. Dep. 130. During the course of Plaintiff's employment in A&D sales, he neither monitored sales ultimately placed by designers, nor received reports of sales generated by A&D. Plaintiff Dep. 59. He received no written information that would indicate the sale or orders generated through his efforts in A&D nor was he privy to the A&D sales representatives' expenses. Pl. Dep. 68, 119. Nowicki managed their expenses, and he managed their sales. Pl. Dep. 119-120. Plaintiff did not know what regions were generating the most sales or the most specifications. Pl. Dep. 244, 245.

While with the A&D division, Plaintiff was never disciplined for poor job performance, nor given any type of verbal reprimand. Def. Dep. 72-73, 218. Plaintiff testified that James Nowicki, Defendant's national sales manager and Plaintiff's direct supervisor, provided Plaintiff with verbalassurances that the A&D department was exceeding expectations under Plaintiff's leadership. Pl. Dep. 92-94, 131, 211-12.

Plaintiff testifies that in September 2012, Nowicki notified him that Defendant would hold "a year-end sales meeting" with all A&D staff in December 2012 to discuss the upcoming year, 2013. Pl. Dep. 70-71, 141-42, 204-07; Email from Plaintiff dated October 29, 2012 (Ex. 6 to Pl. Resp.). This year-end A&D sales meeting would be held in conjunction with Defendant's annual sales meeting, which also took place in December. Pl. Dep. 70-71, 141-42. Nowicki told Plaintiff that he would be responsible for leading the A&D sales meeting in December 2012. Pl. Dep. 70. Nowicki asked Plaintiff "to put together a point of interest for he and Eli [Elbaz] to review so we could discuss to make the meeting very productive and beneficial for all involved." Pl. Dep. 141-42.

Plaintiff sent an email to Nowicki on October 1, 2012 with the subject line that read, "End of Year Review." Pl. Dep. 141-42; Email from Plaintiff dated October 1, 2012 (Ex. 4 to Pl. Resp.). In the email, Plaintiff asked for an end of the year meeting with "HF Mgmt" to discuss his performance and his role with the Florida A&D sales representatives, Ms. Alvarez and Mr. Kapper. Email from Plaintiff dated October 1, 2012. Plaintiff requested this meeting because after his conversation with Mr. Nowicki in September 2012, he expected to receive a raise.³ Pl. Dep. 71.

C. Expectations and Actual Performance of A&D Sales Model

Defendant expected that the A&D sales division would be profitable. Def. Dep. 73. It has a benchmark of $1,000,000.00 in annual sales per person in the dealer market. Def. 73-74. Defendant expected the same sales to be generated from A&D sales representatives. Def. Dep. 74.Defendant expected to see a profit within one year of starting the A&D venture. Def. Dep. 75. Defendant informed all pure A&D sales representatives (Plaintiff and Marlene Alvarez) upon hire that he expected their sales to sustain themselves, or allow the company to break even. Def. Dep. 88-89. Defendant explained, in sum, his arrangement with Plaintiff as follows: "Jim came into the table, just to build [A&D]. . . . And he tried. And we tried to give him all the support we can, but he understood that it has to be built in one year, if not, the whole deal is going down." Def. Dep. 93.

Plaintiff recalls that, in September 2012, Nowikci informed Plaintiff of the status of the A&D department and of the plans to expand the department in the future. Pl. Dep. 92-94, 205-06. Nowicki told Plaintiff that the A&D department was performing "great" and that the company planned on hiring additional A&D sales representatives. Pl. Dep. 92-94, 205-06. Nowicki also stated that Mr. Gibbs would receive a raise at the year-end meeting. Pl. Dep. 212. However, Elbabaz testified that A&D sales were so minimal that, even if the sales were multiplied by ten, the A&D sales representatives would still not break even or become eligible for a commission. Def. Dep. 54-55. In...