Fessler v. IBM Corp., No. 18-2497 (4th Cir. 2020)Annotate this Case
Fessler sued, alleging that his former employer, IBM. unlawfully “capped” his sale commissions despite representing to him that his commissions would be uncapped. The district court dismissed his claims on the basis that the Incentive Plan Letters (IPLs) that IBM presents to its employees foreclosed any reasonable expectation that Fessler would receive additional commissions.
The Fourth Circuit vacated, finding that Fessler adequately stated claims for fraud, constructive fraud, unjust enrichment, quantum meruit, and punitive damages. Although the IPLs stated that they did not constitute a promise and IBM reserved the right to adjust the plan’s terms,.Fessler can plausibly allege that he reasonably relied on PowerPoint presentations that repeatedly informed him that his commissions would be uncapped, and his past experience that IBM never capped a commission before 2016. A jury could find that since the representations that his commission would be uncapped were presented subsequent to Fessler receiving IPLs, it was reasonable for Fessler to understand them as adjustments to the plan’s terms. Fessler can plausibly allege the requisite intent to deceive, based on IBM’s motivation to recruit good salespeople who would not work for IBM if they knew that their commissions would be capped. Fessler’s quantum meruit claim is sufficient because of the lack of a meeting of the minds with regard to the exact payment he would receive for his work.