Michael Hieb v. AIG (2013)

MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT (MOTION # 122.00)

I. INTRODUCTION

The plaintiff Michael Hieb (“Hieb”) has filed this complaint against his former employer, AIG Financial Products Corp. (“AIGFP”) in which he alleges that AIGFP is liable to him for breach of contract, violation of Connecticut General Statutes § 31–72, failure to pay wages in violation of General Statutes § 31–71c and unjust enrichment.   Based on the allegations of his complaint plaintiff seeks compensatory damages and twice the amount of unpaid wages, costs and attorneys fees pursuant to § 31–72.

Plaintiff initiated this action by Notice of application for a prejudgment remedy, summons for hearing, motion for disclosure of assets and complaint dated February 21, 2012.   Following pretrial discovery by both sides, the pleadings were closed and the case was claimed for the trial list on June 29, 2012.   The case is scheduled for trial by jury beginning May 30, 2013.   On November 16, 2012, defendant filed a motion for summary judgment.   In support of this motion for summary judgment, AIGFP has submitted affidavits of Cynthia Curtin, Dennis Zampella and Steve Blake, excerpts of deposition transcripts of plaintiff, Gerry Pasciucco and Jim Shephard, various emails, copies of corporate documents relating to employee compensation during the relevant period and portions of defendant's objections to plaintiff's June 4, 2012 discovery requests.

The matter before the court is defendant's motion for summary judgment filed by the defendant AIG Financial Products Corp. (“AIGFP”) on all counts of the complaint filed against it by its former employee Michael Hieb (“Hieb”).   In support of its motion, AIGFP submitted a memorandum dated November 16, 2012.   Plaintiff replied on December 31, 2012 and AIGFP filed a reply to plaintiff's opposition on January 12, 2013.   The parties appeared before the court at short calendar on January 22, 2013.

SUMMARY OF FACTS

Position of Plaintiff Michael Hieb

In his complaint Hieb alleges that he was employed by AIGFP from April 1998 through April 23, 2010 as Vice President of the Market Risk Management Group, that over the years he progressed to a senior position in the group and was promoted to Managing Director of the group in 2006.   As the subprime mortgage crisis emerged in 2007 Hieb's responsibilities expanded and he moved to London pursuant to the decision to second his employment to Banque AIG. As the credit default swaps portfolio financial crisis evolved during this period, many AIGFP and Banque AIG employees either voluntarily or involuntarily left their employment.   In March 2008, AIGFP adopted an Employee Retention Program (“ERP”) to provide guaranteed retention awards (“GRA”) to AIGFP and Banque AIG employees for 2008 and 2009.   In addition to setting forth the amounts of the 2008 and 2009 GRA, the ERP stated five objectives:

1. To provide incentives for AIGFP's employees and consultants to continue developing, promoting and executing AIGFP's business;

2. To recognize the uncertainty of the unrealized market valuation losses in AIGFP's super senior credit derivative and originally rated AAA cash CDO portfolios have created for AIGFP's employees and consultants;

3. To ensure that AIGFP and its employees and consultants interests continue to be aligned with those of AIGFP and its shareholders;

4. To continue to build and maintain the formation of capital in AIGFP;  and

5. To show the support of AIG of the ongoing business of AIGFP by implementing a meaningful employee retention plan.

Throughout 2009, AIG, AIGFP and Banque AIG employees continued to leave their employment and join competitors despite the infusion of 85 billion dollar government bailout loan.   Hieb asserts that in order to retain talent AIGFP proposed a new compensation scheme whereby employees would receive full compensation on a quarterly basis rather than yearend bonuses and guaranteed retention payments which were generally issued on or about March of the following year.   As proposed by AIGFP, the new compensation had three components;  a) Base salary compensation of up to $500,000 paid in cash;  b) Additional compensation above $500,000, paid 50% in cash and 50% in equity subject to a cap on total cash of $1,000,000;  and c) Incentive compensation payments for any amount above base salary tied to company performance.

On December 14, 2009, in his position as Vice President of Risk Management Group, Hieb received a spreadsheet from human resources with data and proposed compensation amounts for members of the Risk Management Group.   Also on December 14, 2009 Gerry Pasciucco, CEO of AIGFP and Dennis Zampella of AIG human resources sent Hieb an email containing a series of Talking Points (“Talking Points”) for Hieb to use to communicate the guaranteed retention plan to the Risk Management Group.

The Talking Points included, among other things, the following:  (a) individual criteria by which employees would be judged;  (b) the outline of the compensation scheme that was to be implemented following the completion of the compensation period covered by the ERP, including increases retroactive to December 1, 2009 and quarterly incentive cash payment, conditioned on whether AIGFP met certain performance targets;  and a statement that for individuals who fell under the purview of Kenneth Feinberg, the TARP Special Master (“Special Master Feinberg”), implementation of both the salary and incentive compensation plans would be subject to his final approval and no change would take effect before it was given.   On or about December 15, 2009, Hieb received instructions to proceed with the reviews and compensation awards for his group which he did.   Thereafter, Hieb received his own performance review from Jim Shephard, the President of Banque AIG, and Gerry Pasciucco, the Chief Executive Officer of AIGFP.   During his performance review Hieb was informed that he was receiving the highest marks for his work and was commended for his leadership of the Market Risk Management Group following the resignation of the Global Head of Market Risk, Pierre Micottis.   Hieb alleges further that Shephard and/or Pasciucco estimated that his 2010 compensation would total $1,800,000, consisting of a $500,000 cash base salary, $500,000 cash payment in incentive compensation (provided AIGFP met performance targets), and $800,000 in long-term stock, to be paid on a quarterly basis, and that the only condition to payment of his 2010 compensation was the approval of the compensation scheme by Special Master Feinberg.   This compensation proposal followed the same formula which applied to all other similarly situated employees, the 26–100 group.

Hieb alleges that he was again told that once such approval was received, he would be paid retroactively to December 1, 2009 and that in reliance on the company's representations about the new compensation scheme and his 2010 compensation, he elected to continue his employment at AIGFP.   Following these communications on or about March 29, 2010, during the weekly steering committee meeting composed of representatives of AIGFP, AIG Corporate, New York Federal Reserve Bank and the U.S. Treasury Department, it was certified that AIGFP had met its performance targets for the first quarter of 2010.   On or about April 16, 2010, Special Master Feinberg approved the compensation scheme for the top 25–100 earners in 2009 for AIG, including Hieb.

On April 13, 2010, Hieb gave verbal notice of his resignation to Mr. Pasciucco which he confirmed in writing on April 14, 2010.   Following discussions with Mr. Pasciucco, Hieb resigned his position with AIGFP and advised Dennis Zampella and Nadia Jalal that his final date of employment would be April 23, 2010.   On April 15, 2010, Hieb signed a contract of employment with Cairn Capital.

Hieb maintains that pursuant to Special Master Feinberg's approval of the 2010 compensation scheme on April 16, 2010 he was entitled to total compensation of approximately $702,000 from December 1, 2009 to April 23, 2010.   Hieb also alleges that Jalal confirmed to him that he would be paid all sums owned to him from December 1, 2009 through the first quarter of 2010, in accordance with representations made in December 2009.   However, he acknowledges that during his exit interview on or about April 23, 2010, Jalal told Hieb that there was a question as to whether he would receive his earned compensation dating from December 1, 2009.   Jalal referred Hieb to Zampella who informed Hieb that he was not authorized to approve the retroactive payment from December 1, 2009 forward.   The retroactive payment to December 1, 2009 was not approved as part of the overall compensation plan.   Hieb asserts that AIGFP paid all other remaining employees were paid in accordance with the represented new compensation scheme on June 17, 2010 after the AIGFP CMRC approved these payments.   In his complaint Hieb states that he has only received approximately $37,333 of the $702,000 which he claims AIGFP promised to him in the December conversation with the remaining amount owed to him under the 2010 compensation plan of approximately $664,667.   The above facts form the basis for Hieb's claims of breach of contract, his statutory claim of violation of Conn. Gen.Stat. 31–71c et seq. and his common-law unjust enrichment claim.

Position of AIGFP

AIGFP's version of the above facts acknowledges that Michael Hieb was a long-time employee of AIG Financial Products Corp. (“Defendant” or “AIGFP”), a business that was at the center of an unprecedented fiscal crisis in the news in the Spring of 2009.   It is undisputed that as of September 15, 2008 AIGFP lacked the resources to meet its obligations absent a massive federal bailout.   In exchange for providing approximately 85 billion dollars in liquidity to AIG, the federal government took an equity position in AIG of close to eighty percent.   As summarized by AIGFP in its memorandum, notwithstanding the government bailout, AIGFP paid large bonuses to its executives pursuant to an Employee Retention Plan, which sparked intense controversy and public outrage concerning executive compensation.   Hieb was one of the executives who received bonuses, garnering payment of $1,400,000 in March 2009 and payment of $1,260,000 in February 2010.

In light of this controversy, executive compensation at AIGFP was not only a very sensitive subject when it came time in December 2009 to discuss planned compensation for 2010.   This was especially true for employees like Hieb who were among AIG and its affiliates' 100 most highly compensated executives.   Furthermore, under various laws and regulations governing executive compensation, including the Troubled Assets Relief Program (“TARP”) and the Emergency Economic Stabilization Act (“EESA”), the compensation structure for employees like Hieb was subject to review and approval by a complex web of decision makers, including Kenneth Feinberg, the Special Master under TARP (the “Special Master”), and other government bodies, corporate boards and regulators.   It is AIGFP's position that for this reason when AIGFP senior executives Gerry Pasciucco and Jim Shephard met with various individuals to discuss proposed 2010 compensation in December 2009, they made it clear that they were merely discussing a proposal whose approval was conditioned on a number of external factors.   As Pasciucco stated in an email he sent to a number of recipients, including Hieb, on December 14, 2009:

As of today, you are likely to be considered on [sic] of the Top 100 earners at AIG for next year.   The calculation takes into account your likely earnings related to 2009.   Therefore, your compensation is subject to review by Special Master Ken Feinberg.   As we communicate new compensation levels and programs over the next few days, we will communicate our recommendations for each of you, however, those decisions still need to be ratified by the Special Master, and may have additional restrictions associated with them.

It is undisputed that Hieb voluntarily decided to resign his employment on April 13, 2010, and signed an employment agreement with a new employer before the Special Master issued his determination regarding 2010 compensation and before any of the other board or regulatory approvals had been obtained.   When AIGFP's 2010 Senior Executive Incentive Plan (the “2010 Incentive Plan”) was approved in June 2010, it specified, consistent with the prior AIGFP incentive plans in which Hieb had participated, that the executive had to be employed on the date an award was made to be eligible for an incentive payment under the plan.   Hieb was not employed by AIGFP when AIGFP's compensation review committee approved the plan, having left more than two months earlier.

AIGFP vehemently disputes that Hieb is owed an incentive payment under the 2010 Incentive Plan and a salary increase for the first quarter of 2010, specifically that the proposed compensation that it discussed in mid-December 2009 at the beginning of the approval process 1) constitutes a binding contract that 2) overrides the express provisions of the Plan. According to AIGFP, the December 2009 discussion did not as a matter of law give rise to an enforceable promise.

There is no dispute that Hieb's breach of contract claim, wage claim under Conn. Gen.Stat. § 31–72, and unjust enrichment claim are premised on a single conversation between Hieb and AIGFP senior executives Gerry Pasciucco and Jim Shephard that occurred in December 2009 (the “December 2009 Conversation”).   The facts surrounding the December 2009 Conversation are not in dispute, including:

1.  Hieb was advised in writing the day before the conversation took place that the discussion would only entail a “recommendation” and that “decisions still needed to be ratified by the Special Master, and may have additional restrictions associated with them.”

2. The compensation recommendation that was discussed in the December 2009 Conversation was not definitive—a salary of “up to $500,000” was mentioned and a “target” compensation level was discussed, but no definite parameters for incentive compensation (e.g, percentages and forms of equity compensation) were established.

3. Hieb understood that any recommendation was subject to Special Master approval, including any conditions the Special Master might impose.   When the Special Master did approve compensation structures, he specified conditions, including that all compensation could only be paid pursuant to plans approved by the CMRC.

4.  Hieb admits he did not satisfy the condition of employee status as of the final approval by CMRC. He claims that AIGFP's obligation to pay him under the compensation scheme is a contractual right independent of the plan for all others in the top 100 group and that the requirement that one be employed by AIGFP in order to qualify for payment did not apply to him.

II. APPLICABLE LAW—MOTION FOR SUMMARY JUDGMENT

“Practice Book § 17–49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show 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.   In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party.”  (Internal quotation marks omitted.)  Brooks v. Sweeney, 299 Conn. 196, 210, 9 A.3d 347 (2010).  “In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact ․ To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact ․ Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue ․ It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue.   Mere assertions of fact ․ are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § [17–45].”  (Internal quotation marks omitted.)   Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 10–11, 938 A.2d 576 (2008).

“As the party moving for summary judgment, the [movant] is required to support its motion with supporting documentation, including affidavits.”  Heyman Associates No. 1 v. Insurance Co. of Pennsylvania, 231 Conn. 756, 796, 653 A.2d 122 (1995).   Likewise, “[t]he existence of the genuine issue of material fact must be demonstrated by counteraffidavits and concrete evidence.”  (Internal quotation marks omitted.)  Gianetti v. Health Net of Connecticut, Inc., 116 Conn.App. 459, 465, 976 A.2d 23 (2009).  “While [a party's] deposition testimony is not conclusive as a judicial admission;  General Statutes § 52–200;  it is sufficient to support entry of summary judgment in the absence of contradictory competent affidavits that establish a genuine issue as to a material fact.”  Collum v. Chapin, 40 Conn.App. 449, 450 n.2, 671 A.2d 1329 (1996).   A party's “conclusory statements, in the affidavit and elsewhere ․ do not constitute evidence sufficient to establish the existence of disputed material facts.”  Gupta v. New Britain General Hospital, 239 Conn. 574, 583, 687 A.2d 111 (1996).

In the present motion for summary judgment, the defendant claims that it is entitled to judgment as a matter of law on the contract claim because there was no enforceable promise, and that even if there was an enforceable promise, that promise had conditions that the plaintiff failed to fulfill.   It claims it is entitled to judgment on the statutory claim because it did not fail to pay the plaintiff his wages.   Finally, it claims it is entitled to judgment on the unjust enrichment claim because it did not fail to pay Hieb and because the existence of an express contract prevents an unjust enrichment claim for services rendered under that contract.   The plaintiff responds that there are issues of material fact as to contract formation and performance, statutory failure to pay wages and unjust enrichment.   The court will consider each of these issues in turn.

I

COUNT ONE:  BREACH OF CONTRACT

“The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages.”  (Internal quotation marks omitted.)  Rosato v. Mascardo, 82 Conn.App. 396, 411, 844 A.2d 893 (2004).[”M]ere representations indicating an intent to enter into another employment contract at some time in the future do not support contractual liability.”  Geary v. Wentworth Laboratories, Inc., 60 Conn.App. 622, 626, 760 A.2d 969 (2000).  “To form a valid and binding contract in Connecticut, there must be a mutual understanding of the terms that are definite and certain between the parties ․ [A]n agreement must be definite and certain as to its terms and requirements ․ A contract requires a clear and definite promise.”  (Internal quotation marks omitted.)  Cruz v. Visual Perceptions, LLC, 136 Conn.App. 330, 335, 46 A.3d 209, cert. granted in part, 306 Conn. 903, 52 A.3d 730 (2012).

“Corporations generally have the power to appoint agents with full authority to do acts or enter into contracts within the powers of the corporation.”   National Publishing Co., v. Hartford Fire Ins. Co., 287 Conn. 664, 677 n.6, 949 A.2d 1203 (2008).  “An agent's authority may be actual or apparent ․ Actual authority exists when [an agent's] action [is] expressly authorized ․ or although not authorized, [is] subsequently ratified by the [principal] ․ In contrast, [a]pparent authority is that semblance of authority which a principal, through his own acts or inadvertences, causes or allows third persons to believe his agent possesses ․ Consequently, apparent authority is to be determined, not by the agent's own acts, but by the acts of the agent's principal ․ The issue of apparent authority is one of fact to be determined based on two criteria ․ First, it must appear from the principal's conduct that the principal held the agent out as possessing sufficient authority to embrace the act in question, or knowingly permitted [the agent] to act as having such authority ․ Second, the party dealing with the agent must have, acting in good faith, reasonably believed, under all the circumstances, that the agent had the necessary authority to bind the principal to the agent's action.”  (Citations omitted, internal quotation marks omitted.)  Ackerman v. Sobol Family Partnership, LLP, 298 Conn. 495, 508–09, 4 A.3d 288 (2010).

“[C]ourts increasingly have been willing to flesh out the intended meaning of indefinite contract language by recourse to trade custom, standard usage and past dealings.”  (Internal quotation marks omitted.)  Small Business Transportation, Inc. v. ABC Stores, LLC, 96 Conn.App. 14, 19, 899 A.2d 73 (2006).  “A contract is express if its terms are stated by the parties, either orally or in writing, and it is implied if its terms are not so stated.   In other words, an implied contract is one in which some or all of the terms are inferred from the conduct of the parties and the circumstances of the case, though not expressed in words, while an express contract is one in which the parties arrive at their agreement and express it in words, either oral or written.”  Schreiber v. Connecticut Surgical Group, P.C., 96 Conn.App. 731, 738, 901 A.2d 1277 (2006).

In the present case, the defendant claims that there was no express or implied contract between the plaintiff and the defendant created by the mid December 2009 oral communication between the plaintiff, Gerard Pasciucco, Chief Operating Officer of AIG Financial Products, and James Shephard, Banque AIG's Chief Executive Officer.   The plaintiff claims that these communications constitute an enforceable promise.   The defendant then further argues that if there was a contractual obligation, it incorporated the terms of the written Plan, and that the plaintiff failed to abide by the terms of the Plan by resigning from the defendant before payment was made under the Plan. The plaintiff claims that the operative contract is the oral promise by Pasciucco and Shephard, rather than the written Plan.¹ The following facts can be adduced from excerpts of the depositions of the plaintiff and Pasciucco, submitted by the defendant.²

By email dated December 14, 2009, prior to the meeting with the plaintiff, Pasciucco informed all the employees that compensation was currently uncertain and that compensation for certain employees would depend on approval by Feinberg and would have additional restrictions.   That email notes that details would be forthcoming in the next few days, which the defendant claims demonstrates that the terms were not detailed enough for a valid contract to form.   The plaintiff argues, however, that the meeting between Pasciucco, Shephard and the plaintiff contained those details.

In the December 15, 2009 meeting, which occurred after the email was sent, Pasciucco and the plaintiff discussed specific compensation numbers for the plaintiff, $1.8 million of total compensation with a salary of $500,000.   AIGFP fully accepts plaintiff's account of what was said.   The plaintiff conceded in his deposition that Pasciucco stated during the conversation that approval by Special Master Feinberg was necessary before the compensation could be awarded.   He did not concede that any additional restrictions were discussed at the meeting.

Special Master Feinberg approved the proposed compensation scheme in general terms for all employees at the plaintiff's level on April 16, 2010, according to a letter submitted by the defendant.   Feinberg's approval did not set any specific amounts.   It set limits on the amount of compensation which could be in cash and which could be in stock and required that the employee meet specific standards.   It specified that the “amounts and conditions of the components for each Covered Employee will be determined by AIG's compensation committee.”   It also specified that AIG was required to modify proposed compensation structures to conform with Feinberg's requirements.   Contrary to plaintiff's claim the Special Master's approval did not trigger his entitlement to payment.   It was a necessary precondition to AIGFP's ability to proceed with the development and approval process for compensation of its top level employees.   Subsequent to Feinberg's determination the actual details of the Plan were determined by the CMRC, then approved by the defendant's board on June 9, 2010, and payments were made on June 17, 2010.

AIGFP argues that even if the above facts can be construed to constitute an enforceable agreement, Hieb is not entitled to performance because he failed to fulfill conditions required for performance.

The plaintiff conceded in his deposition that he is not entitled to payment under the written Plan, approved on June 9, 2010, because he was not a “Covered Person” as defined in the Plan and as required by section 3.04.   The written Plan contains numerous restrictions, including that an individual be a “Covered Person,” i.e., be employed by the defendant on the date when payment was made.   The written Plan also provides for different compensation than the plaintiff claims he was promised.   The defendant maintains that this written plan memorializes the only valid contract for compensation of the 26–100 group in which plaintiff would have been included had he remained employed by defendant as of June 9, 2010.   The plaintiff claimed in his deposition that he did not agree to the written Plan and was only shown it during the course of the current litigation.   This lone statement somehow suggests that the plaintiff's compensation was a matter of negotiation and that in the midst of an unprecedented fiscal crisis for the country and his employer he was the only employee of the top 26–100 group to which the oversight regulatory restrictions, compensation review process and Plan terms did not apply.   Search as it may, the court cannot find support for the plaintiff's position in the undisputed facts this case.   Plaintiff's assertion that he did not agree to the written Plan is not relevant to his claim that an enforceable contract resulted from the oral communication by Pasciucco to him in December 2009.

The plaintiff claims that an oral contract was created by Pasciucco's December statement that the defendant would present compensation recommendations to the Special Master for his approval.   He then argues that the approval by Feinberg was “merely” a condition precedent to performance.   This argument ignores the undisputed facts of the defendant's position in the fiscal crisis and the consequences of the regulatory approval process.   As a condition for a loan of eighty-five billion dollars required for AIG to meet its financial obligations, the federal government had taken over AIG and assumed a controlling interest in the company.   It had appointed Special Master Feinberg to approve compensation schemes for certain groups of employees, of which the plaintiff concedes he was a member.   In this situation, neither Pasciucco nor any other representative of AIG had the authority to make a contract regarding compensation for someone at the plaintiff's level.   This was made clear by the email and by the surrounding circumstances, of which the plaintiff, himself a manager charged with communicating the compensation scheme to his subordinates, was acutely aware.   Previous bonus payments had been subject to massive public scrutiny, resulting in the defendant's employees giving back those bonuses and stringent requirements being placed on any new compensation schemes.   The 2010 compensation structures were subject to oversight, first by Special Master Feinberg whose responsibility was to determine whether the compensation scheme proposed by AIGFP violated the terms of the bailout or was otherwise contrary to the public interest.   Once the Special Master made this determination, the compensation scheme was subject to further approvals by the French Secretariat General de la Commission Bancaire,³ thereafter, by the Compensation and Management Resources Committee (CMRC) of the Board of Directors of AIG, and finally by the defendant's board.   The full details of the Plan, including the actual compensation breakdown and specific requirements, were fleshed out by the CMRC. The defendant needed to obtain approval from each of these entities before it could create an incentive plan.   If the plaintiff had any contract, it would have to be the Plan which was eventually approved by the defendant's board.   While not specifically stated in the December 14 email, these approvals would be among the “additional restrictions” contemplated therein.   The fact that the additional approvals by other bodies were required supports the only logical conclusion that Special Master Feinberg's approval was a necessary predicate to the remaining approval process, not the sole condition precedent to AIGFP's performance.

As noted above, the Plan contained the provision that the individual remain employed throughout the process, until the time the payments were actually made as a condition for qualifying for payment.   As noted above, Hieb gave notice of his voluntary decision to leave AIGFP and signed an employment letter with a new employer before the Special Master gave his approval.   Plaintiff also acknowledges that he was not an employee as of the date the defendant approved the plan.   In order for the plaintiff to prevail, the court would have to find that Special Master Feinberg's approval of the compensation scheme was the sole and final act required the plaintiff to be entitled to payment under the plan and that the December 14, 2009 email which Hieb received along with the other employees at the 26–100 level and that the approvals by regulatory bodies and the CMRC did not apply to him.   It would also have to find that Hieb was the sole individual who did not have to be a “Covered Person” in order to be entitled to payment.   There is no material fact to support this position.   The undisputed facts contradict the plaintiff's assertion that his oral conversation with Pasciucco in December 2009 resulted in a contractual obligation to compensate the plaintiff on terms contrary to the defendant's obligations under the terms of the plan and separate from all other employees at the 26–100 level.   Even more significantly, plaintiff's claim would require a finding that the December conversation overrode both the entire regulatory and corporate review process and the well established industry practice, that an individual must remain an employee in order to receive compensation under plans such as the one in question in this case.   Finally, it would require a finding for which there is absolutely no support in the material presented, that the defendant would have made what had to be a secret agreement with Hieb on terms more favorable than those which applied to other employees under the plan.   Given the required approval process, such an agreement by AIGFP would have risked the overall plan for the top 100 and fails to acknowledge the consequences of the bailout.   Viewing the evidence most favorably for the plaintiff, the court nonetheless concludes that there is no genuine issue of any material fact which would affect the outcome of the case.   There is absolutely no basis in law or fact to support the plaintiff's breach of contract claim.   Accordingly, the court will grant the motion for summary judgment as to count one.

II

COUNT TWO—VIOLATION OF GENERAL STATUTES § 31–72

The defendant claims that the plaintiff's breach of contract claim must fail, therefore the claim for violation of General Statutes § 31–72, for failure to pay wages, must also fail.  “Section 31–72 provides in relevant part that [w]hen any employer fails to pay an employee wages in accordance with the provisions of sections 31–71a to 31–71i, inclusive, or fails to compensate an employee in accordance with section 31–76k ․ such employee ․ may recover, in a civil action, twice the full amount of such wages, with costs and such reasonable attorneys fees as may be allowed by the court ․ The statute provides for a discretionary award of double damages, with costs and reasonable attorneys fees, to employees who are successful in actions against their employers for wages due ․ Although § 31–72 does not set forth a standard by which to determine whether double damages should be awarded in particular cases, it is well established ․ that it is appropriate for a plaintiff to recover attorneys fees, and double damages under [§ 31–72], only when the trial court has found that the defendant acted with bad faith, arbitrariness or unreasonableness.”  (Citations omitted, internal quotation marks omitted.)   Ravetto v. Triton Thalassic Technologies, Inc., 285 Conn. 716, 724, 941 A.2d 309 (2008).  “[Awarding double damages in lost wage cases] ‘constitutes a Congressional recognition that failure to pay the statutory minimum on time may be so detrimental to maintenance of the minimum standard of living necessary for health, efficiency and general well-being of workers and to the free flow of commerce, that double payment must be paid in the event of delay in order to insure restoration of the worker to that minimum standard of well-being.’   Brooklyn Savings Bank v. O'Neil, 324 U.S. 697, 707, 65 S.Ct. 895, 89 L.Ed. 1296 (1945).   We therefore conclude that the court did not abuse its discretion in awarding double damages pursuant to § 31–72.”  Petronella v. Venture Partners, Ltd., 60 Conn.App. 205, 215–16, 758 A.2d 869 (2001), appeal dismissed, 258 Conn. 453, 782 A.2d 97 (2001).

Judges of the Superior Court have found that even if the defendant mistakenly believed that the plaintiff was not entitled to unpaid wages, if such belief was in good faith the plaintiff is not entitled to double damages.  “While the court did not agree with [the defendant's] interpretation of the obligation imposed on it by the Participation Agreement, it could not be determined to be unreasonable.   Certainly there was no convincing evidence of bad faith or arbitrariness on the part of [the defendant] for the position that it took.”   Niehaus v. Cowles Business Media, Inc., Superior Court, judicial district of Fairfield, Docket No. CV 99 0363675 (January 9, 2009, Maiocco, J.).  “In this case, the evidence was that the defendant, PLS, Inc. refused to pay the plaintiff's third quarter 2008 commission on the grounds that it was not obligated to do so after plaintiff left defendant's employ.   This was a wrong, but bonafide belief and doesn't rise to the level of bad faith, arbitrariness, or unreasonableness.   As a consequence, the plaintiff is not entitled to double damages and attorneys fees.   The plaintiff, however, is entitled to costs and interest at the statutory rate of 10% from January 1, 2009.”   Francis v. PLS, Inc., Superior Court, judicial district of Hartford, Docket No. CV 09 5029386 (December 15, 2009, Satter, J.) [49 Conn. L. Rptr. 31].

In the present case, as noted above, the court finds that the plaintiff was not entitled to payment.   Therefore, he has no claim under § 31–72.   Furthermore, none of the evidence suggests that the defendant's refusal to pay was the result of bad faith, arbitrariness or unreasonableness.

Accordingly, the court will grant the motion for summary judgment as to count two.

III

COUNT THREE:  UNJUST ENRICHMENT

The defendant claims that the plaintiff's unjust enrichment claim must fail because it is undisputed that the plaintiff did receive compensation for the work he performed in the first quarter of 2010, and in addition because the plaintiff cannot claim unjust enrichment while also claiming that an express contract, the written Plan, existed.   The plaintiff responds that the compensation referenced by the defendant was for work performed in the previous year, and he is not claiming that the written Plan applies, but rather that the meeting between Pasciucco, Shephard and the plaintiff created either a contract or a quasi-contractual promise on which the unjust enrichment claim is based.

“A right of recovery under the doctrine of unjust enrichment is essentially equitable, its basis being that in a given situation it is contrary to equity and good conscience for one to retain a benefit which has come to him at the expense of another ․ With no other test than what, under a given set of circumstances, is just or unjust, equitable or inequitable, conscionable or unconscionable, it becomes necessary in any case where the benefit of the doctrine is claimed, to examine the circumstances and the conduct of the parties and apply this standard ․ Unjust enrichment is, consistent with the principles of equity, a broad and flexible remedy.   Plaintiffs seeking recovery for unjust enrichment must prove (1) that the defendants were benefitted, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs' detriment.”  Vertex, Inc. v. Waterbury, 278 Conn. 557, 573, 898 A.2d 178 (2006).

Where “the plaintiff did not allege that his employment contract with the defendants was in any respect unenforceable [and] he did not allege that he had performed services other than those contemplated by the contract ․ he has not alleged any basis for the proposition that he conferred extra contractual benefits on the defendants.”  Meaney v. Connecticut Hospital Assn., Inc., 250 Conn. 500, 517, 735 A.2d 813 (1999).   This “preclusionary rule has been applied in numerous cases to deny a claim for judicial relief premised on incomplete negotiations on the subject of additional compensation for work that falls within the contemplated scope of an existing contract.”  Id., 518–19.   If “the parties agreed on the idea of additional compensation,” but that “agreement, concededly, was too indefinite to be enforceable as a matter of contract law ․” the plaintiff's claim that the agreement “was sufficiently definite to afford him a remedy for unjust enrichment ․ rings hollow.”   Id., 519.  “[P]inpointing and quantifying even a senior employee's contributions to the profits of a complex enterprise is, as this case demonstrates, too fraught with uncertainty to prove unjust enrichment.”   Id., 520.  “Even if room may yet exist for [an unjust enrichment cause of action regarding] indefinite promises to pay incentive compensation in appropriate circumstances, the predicate for such a claim must be an unconditional commitment to pay such compensation.”  Id., 522.   Where “the parties' own conduct, over several years, had established a pattern of bonus payments ․ a plaintiff appropriately might recover according to the standard of the market, or, in the absence of such a standard, according to such fair approach thereto as may [be] found to be attainable ․” (Citations omitted, internal quotation marks omitted.)  Id., 521.  “[W]e are not persuaded that, merely because the focus of the plaintiffs' unjust enrichment claim bears an indirect relation to the subject matter of the parties' express contract, the unjust enrichment claim is barred.”  (Internal quotation marks omitted.)   New Hartford v. Connecticut Resources Recovery Authority, 291 Conn. 433, 458–59, 970 A.2d 592 (2009).

“Parties routinely plead alternative counts alleging breach of contract and unjust enrichment, although in doing so, they are entitled only to a single measure of damages arising out of these alternative claims.”  (Internal quotation marks omitted.)  Stein v. Horton, 99 Conn.App. 477, 485, 914 A.2d 606 (2007).  “[T]he plaintiff may plead unjust enrichment in the alternative, but this is not accomplished by incorporating into this count all the allegations of an express contract.   Such a complaint does not involve alternative pleading, but involves legally inconsistent pleading.”   J & N Electric, Inc. v. Notkins, Superior Court, judicial district of New Haven, Docket No. CV 085020144 (May 20,2009, Keegan, J.) [47 Conn. L. Rptr. 804];  see also Brantley v. Residential Makeover, LLC, Superior Court, judicial district of New Haven, Docket No. CV 105033289 (July 25, 2012, Fischer, J.);   Burke v. The Boat–Works, Inc., Superior Court, judicial district of Stamford–Norwalk at Stamford, Docket No. CV 044001838 (July 26, 2005, Jennings, J.) (“It has been held in several recent Superior Court cases that allegations of [ an] express contract between the parties incorporated into a count stating a claim for unjust enrichment cause a violation of the rule that those alternative causes of action must be pleaded in separate counts”).

The plaintiff's complaint incorporates all previous paragraphs into the unjust enrichment count, creating the logical inconsistency that a single count alleges an express contract and unjust enrichment.   The earlier breach of contract count alleges the formation of an oral contract when the plaintiff met with Shephard and Pasciucco.   At the least, the unjust enrichment count should have been stricken and repleaded.   For the purpose of a motion for summary judgment, however, the court will look beyond the allegations to the undisputed evidence, consider the arguments of both parties, and determine whether the defendant is entitled to judgment as a matter of law.

The defendant argues that the plaintiff was richly compensated for the work he performed in the first quarter of 2010;  the plaintiff responds that this compensation was provided for his work in 2009.   The plaintiff's deposition and other submitted evidence demonstrate that the plaintiff received compensation for the services he rendered to the defendant in the first quarter of 2010;  in the form of his salary and ex-pat benefits.   The defendant also claims that the 2009 retention award of $1.26 million should count as compensation for services in 2010 because the plaintiff would have forfeited this award if he had resigned prior to the end of March 2010.   In his deposition, the plaintiff stated that guaranteed retention awards for 2008 and 2009 were paid annually in 2009 and 2010, and that the defendant's custom had been to provide annual bonuses.   The undisputed facts therefore demonstrate that the plaintiff received his regular salary and expat benefits in the first quarter of 2010, along with a bonus for services he provided in previous years.

The plaintiff argues that the defendant was unjustly enriched because the plaintiff worked for the defendant and met his performance goals but did not receive a bonus for the first quarter of 2010.   It is true that in previous years, the plaintiff had received a yearly bonus and therefore may have expected to receive a similar bonus and provided services in that expectation.   In the present action, however, the plaintiff is seeking payment for a quarterly bonus under the theory that the defendant altered the incentive scheme to provide for quarterly, rather than yearly, bonuses.   The plaintiff does not claim that the written Plan applies to him, but rather claims that an agreement was made during his meeting with Pasciucco and Shephard.

Under Meaney v. Connecticut Hospital Association, Inc., supra, 250 Conn. 517, a potential contractual change cannot give rise to an unjust enrichment action unless additional work was done which was not contemplated by the earlier contract.   If the change is sufficiently definite, then a new contract is formed under which the plaintiff can collect.   If, however, the proposed changes are too indefinite to support a new contract and the plaintiff continues to work under an existing contract, he has no recourse under unjust enrichment.   In the present case, the plaintiff makes a claim for breach of contract stemming from the meeting with Pasciucco and Shephard, which this court disposed of in section one.   The undisputed facts demonstrate that the plaintiff was paid wages and expat benefits under his existing employment contract, he would not yet have been eligible for a bonus payment under the previous years' systems, and he was not eligible for payment under the written terms of the Plan. These facts demonstrate that he does not have a claim for unjust enrichment.   He was paid for his services in the manner in which he had been paid in the past.   The defendant is therefore entitled to judgment as a matter of law on the unjust enrichment count.

Accordingly, the court will grant the motion for summary judgment as to count three.

CONCLUSION

The court grants summary judgment for the defendant on all counts.

SOMMER, J.

FOOTNOTES

FN1. The plaintiff also submitted an argument after the hearing on the present motion claiming that the defendant breached the agreement with the plaintiff because the proposal it submitted to Feinberg varied from the compensation discussed with the plaintiff.   The defendant is correct that this argument was procedurally improper, and correct that the change reinforces the defendant's position that a binding contract was not created at the meeting..  FN1. The plaintiff also submitted an argument after the hearing on the present motion claiming that the defendant breached the agreement with the plaintiff because the proposal it submitted to Feinberg varied from the compensation discussed with the plaintiff.   The defendant is correct that this argument was procedurally improper, and correct that the change reinforces the defendant's position that a binding contract was not created at the meeting.

FN2. See Hieb Dep. At 61:20–62:3 “My understanding was that there would be a target compensation number and that for myself that was 1.8 million U.S. dollars and that, in line with the compensation plan that was being rolled out for all employees, that I would be compensated with a base salary up to five hundred thousand U.S. dollars ․”;  See also Hieb Dep. 48–52:1–5.Hieb admits, the base salary discussed in the December 2009 Conversation was not a concrete number.   Hieb Dep. at 61:20–62:3 “I would be compensated with a base salary up to five hundred thousand U.S. dollars ․”See also Pasciucco Dep. at 33:24–34:17 “The process was very interactive, and there were numerous stakeholders, like there were in a lot of things at FP. So these structures were discussed with representatives from U.S. Treasury, from the New York Fed, with AIG senior management and with the Special Master's office, and the responses were not always consistent.   There were different sensitivities in each of in each of those places.   They were also discussed with employees, sometimes with senior employees, sometimes with junior employees;  sometimes feedback was collected on proposals.   And like a lot of negotiations, the objective was to try to find something that met all the requirement of all the stakeholders, including employees.”.  FN2. See Hieb Dep. At 61:20–62:3 “My understanding was that there would be a target compensation number and that for myself that was 1.8 million U.S. dollars and that, in line with the compensation plan that was being rolled out for all employees, that I would be compensated with a base salary up to five hundred thousand U.S. dollars ․”;  See also Hieb Dep. 48–52:1–5.Hieb admits, the base salary discussed in the December 2009 Conversation was not a concrete number.   Hieb Dep. at 61:20–62:3 “I would be compensated with a base salary up to five hundred thousand U.S. dollars ․”See also Pasciucco Dep. at 33:24–34:17 “The process was very interactive, and there were numerous stakeholders, like there were in a lot of things at FP. So these structures were discussed with representatives from U.S. Treasury, from the New York Fed, with AIG senior management and with the Special Master's office, and the responses were not always consistent.   There were different sensitivities in each of in each of those places.   They were also discussed with employees, sometimes with senior employees, sometimes with junior employees;  sometimes feedback was collected on proposals.   And like a lot of negotiations, the objective was to try to find something that met all the requirement of all the stakeholders, including employees.”

FN3. Technically, the plaintiff was seconded to Banque AIG, hence the need for approval by the French banking regulatory body..  FN3. Technically, the plaintiff was seconded to Banque AIG, hence the need for approval by the French banking regulatory body.

Sommer, Mary E., J.