The opinion of the court was delivered by: Sandra L. Townes United States District Judge
TOWNES, United States District Judge*fn1
Plaintiff, Gregorio Soto ("Plaintiff" or "Soto"), brings this action against his former employer, defendant Federal Express Corporation ("FedEx" or "Defendant"), alleging breach of contract and loss of reputation as a result of his termination. Defendant now moves for summary judgment dismissing the complaint pursuant to Rule 56 of the Federal Rules of Civil Procedure. In addition, by a separate motion, Defendant moves for sanctions because it claims the action is frivolous. For the reasons set forth below, Defendant's motion for summary judgment is granted, and the motion for sanctions is denied. BACKGROUND*fn2
In October 1990, Plaintiff applied to work for FedEx, and was initially hired as a Cargo Handler in February 1991. Subsequently, he was promoted over the succeeding eight years from Cargo Handler to Courier, then to Station Lead, and finally, from Station Lead to Operations Manager in 1999. Prior to his termination on July 11, 2003, Plaintiff served as an Operations Manager for approximately 61/2 years.
Plaintiff did not have a contract of employment while working for FedEx. When he initially applied to work for FedEx in October 1990, he executed an Employment Agreement, which provided, in part, that Plaintiff understood that his employment was indefinite in duration, his employment and compensation could be terminated at any time without cause or notice of liability, and that no person at FedEx -- other than the Chief Executive Officer or Senior Vice President -- could enter into an employment agreement with him. See Deposition of Gregorio Soto ("Soto Depo."), pp. 75-77, Exh. 8 thereto. In addition, the Employment Agreement states: "Nothing in this agreement or any other communication from the Company shall abrogate this employment-at-will status." Id. Pursuant to the Employment Agreement, Plaintiff agreed to "comply with the guidelines established in the Company's rules, regulations and procedures, which I understand shall be amended from time to time." Id.*fn3
During Plaintiff's employment with FedEx, the company distributed several versions of the Federal Express Employee Handbook (the "Employee Handbook"), to all new employees in 1991, and thereafter distributed updated versions in 1993, 1996, and 2002. See Declaration of Samuel L. Nesbit dated August 24, 2007 ("Nesbit Decl.") ¶¶ 3-4. Although all employees should have received each edition of the Employee Handbook, Plaintiff only recalls receiving a copy of the Employee Handbook when he began working at FedEx in February 1991. See Soto Depo., pp. 78-84; Nesbit Decl. ¶¶ 3-4. The second page of the 1996 Employee Handbook includes a disclaimer that states: "The [Employee Handbook] is not a contract of employment, nor should its provisions be read or implied to provide for one. Your specific rights are governed by the Employment Agreement you signed in your employment application." Defendant's Rule 56.1 Statement ¶ 4.*fn4
Also, Plaintiff acknowledges that, on at least three separate occasions, he signed a receipt form indicating that he received a copy of the Employee Handbook ("Record of Receipt") in 1991, 1993, and 2002. See Soto Depo., at pp. 78-84, Exhs. 6a, 6b, 7. The exact language of each Record of Receipt differs, but they all state that signing the form indicates that the employee understands that the Employee Handbook is not a contract of employment. See id. In particular, the 1993 Record of Receipt repeats the same language as the above-quoted disclaimer in the 1996 Employee Handbook. See Soto Depo., p. 79, Exh. 6b. Also, by signing the 1993 Record of Receipt, Plaintiff acknowledged that he "understand[s] that [the Employee Handbook] contains guidelines only." Id.
In addition to the Employee Handbook, during Plaintiff's employment, FedEx maintained a document known as the "People Manual," which contained the policies and procedures applicable to FedEx employees. Nesbit Decl. ¶ 5. FedEx regularly updated the People Manual, and at the time of Plaintiff's termination, the 2006 People Manual was in effect. Page xi of the 2006 People Manual included the following provision:
This manual is intended solely as a guide for management and employees during employment. It is not a contract of employment, and no such contract may be implied from its provisions. Nothing in this manual shall be construed to abrogate the employment agreement signed upon application for employment preserving the Company's and the employee's right to terminate this relationship at the will of either party.
Id. ¶ 6; Defendant's Rule 56.1 Statement ¶ 8.*fn5 The People Manual also outlined a FedEx procedure that enabled employees to challenge various management decisions, including termination decisions, known as the Guaranteed Fair Treatment Procedure ("GFTP"). Nesbit Decl. ¶ 13. As Operations Manager, Plaintiff consulted the People Manual, including the GFTP, to ensure that he acted according to FedEx policy when disciplining other employees. See Declaration of Gregory Soto, sworn to November 9, 2007 ("Soto Decl.") ¶ 4. Plaintiff states that, upon becoming a manager, he was instructed to strictly follow FedEx policy regarding discipline and dismissal since no employee can be disciplined or discharged without just cause. See Soto Decl. ¶ 3. Plaintiff further states that he relied on his managers' representations that no employee can be fired without cause. See id. ¶ 5.
On March 1, 2005, Plaintiff received a memorandum from his Senior Manager, George Thomas, instructing him to review the changes to FedEx's policy against falsification of records, which designated a deliberate violation of such policy as grounds for termination. See Defendant's Rule 56.1 Statement ¶ 9; Soto Depo., pp. 63-65, Exh. 10h thereto. During the remainder of 2005 and part of 2006, Plaintiff was given several written warnings and reminders regarding violations of various FedEx policies, including having too many "service failures" (i.e., failures to timely deliver packages) on a daily basis. See Defendant's Rule 56.1 Statement ¶ 9; Soto Depo., pp. 67-70, Exhs. 10i - 10n thereto. In February 2006, Plaintiff was questioned by two supervisors -- Mr. Thomas and Samuel Nesbit, Plaintiff's Managing Director -- regarding inappropriate computer entries ("DEX scans") associated with packages that were delivered from his station. See Defendant's Rule 56.1 Statement ¶ 11; Nesbit Decl. ¶ 15. During this interrogation, Plaintiff admitted that he had, contrary to FedEx policy, manually entered DEX scans on packages that otherwise would have been considered "service failures" to make it appear that no service failure had occurred. See Defendant's Rule 56.1 Statement ¶ 11; Nesbit Decl. ¶ 15. At that point, Plaintiff's supervisors instructed him to cease entering false DEX scans and reviewed FedEx policy with him. See Defendant's Rule 56.1 Statement ¶ 11; Nesbit Decl. ¶ 15.
On July 11, 2006, Plaintiff's employment with FedEx was terminated for leadership failure. See Defendant's Rule 56.1 Statement ¶ 12; Nesbit Decl. ¶ 12. Defendant claims that Plaintiff was terminated because he was aware of the improper DEX scans, and he refused to cooperate with a related security investigation. See Defendant's Rule 56.1 Statement ¶ 12; Nesbit Decl. ¶ 12. After Mr. Nesbit was informed of policy violations at Plaintiff's station, he arranged for his security team to investigate the matter. See Defendant's Rule 56.1 Statement ¶ 13; Deposition of Samuel Nesbit ("Nesbit Depo."), pp. 32-34. The investigation revealed that two FedEx employees -- Ahmad Shafi and Fausto Alvarez -- had entered, on numerous occasions, DEX codes to alter the delivery times of packages that they did not personally deliver. See Defendant's Rule 56.1 Statement ¶¶ 14-15; Nesbit Depo., pp. 34-35, 44-45. When questioned, Shafi and Alvarez stated that they had been directed to manually enter the DEX codes by Plaintiff and another manager, Andre Hemraj.*fn6 See Defendant's Rule 56.1 Statement ¶ 15; Nesbit Depo., pp. 48.
On June 12, 2006, Plaintiff was interviewed by the security investigators, and following the interview, Plaintiff was asked to prepare and sign a written statement restating his testimony. See Defendant's Rule 56.1 Statement ¶ 18; Soto Depo., pp. 21, 85. Plaintiff refused to produce the written statement and opined that his recorded testimony should be used as his written statement. Soto Depo., pp. 85-87. Although FedEx policy, at that time, dictated that Plaintiff's refusal to provide a written statement would constitute a failure to cooperate with a security investigation, and could result in discipline, including termination, see Nesbit Decl. ¶ 12, Plaintiff claims that he was unaware of the "mandatory" nature of the written statement. Soto Decl. ¶ 9. In accordance with FedEx policy, on June 26, 2006, Plaintiff was suspended by his new Senior Manager, Ramona Oliver, pending further investigation into the DEX code falsification. See Defendant's Rule 56.1 Statement ¶ 19; Soto Depo., p. 24. Following his suspension, Plaintiff submitted a statement to Ms. Oliver disputing the facts supporting the suspension. Soto Decl. ¶ 10; Soto Depo., pp. 123-125, Exh. 11 thereto. Thereafter, on July 11, 2006, FedEx notified Plaintiff that his employment was being terminated for leadership failure. See Defendant's Rule 56.1 Statement ¶ 20; Soto Depo., p. 26, Exh. 10 thereto.
Through FedEx's three-step GFTP, Plaintiff appealed his termination. See Defendant's Rule 56.1 Statement ¶ 21; Nesbit Decl. ¶ 13. Plaintiff was provided a hearing and Mr. Nesbit personally interviewed all of the employees involved in the DEX falsification matter. Plaintiff's termination was upheld at each level. See ...