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Buckman v. Calyon Securities (USA) Inc.

September 14, 2011

JARVIS BUCKMAN, PLAINTIFF,
v.
CALYON SECURITIES (USA) INC. AND CALYON - NEW YORK BRANCH, DEFENDANTS.



The opinion of the court was delivered by: Shira A. Scheindlin, U.S.D.J.

OPINION AND ORDER

I. INTRODUCTION

Jarvis Buckman brings this action against Calyon Securities (USA) Inc. ("CSI") and Calyon - New York Branch (collectively, "Calyon") alleging (1) race and national origin discrimintion under Title VII of the Civil Rights Act of 1964 ("Title VII") and the New York City Human Rights Law ("NYCHRL"); (2) retaliation under Title VII and the NYCHRL; (3) breach of contract; (4) fraudulent inducement; (5) unjust enrichment; and (6) violation of section 193 of the New York Labor Law. Buckman's claims essentially fall into two categories: (1) that Calyon terminated his employment due to his race (African-American) and national origin (non-French) and (2) that Calyon promised him a seven-figure bonus if he met certain sales targets.

Calyon now moves for summary judgment on all claims pursuant to Rule 56 of the Federal Rules of Civil Procedure arguing that (1) Buckman was terminated as part of a reduction in force and there is no evidence permitting a reasonable inference that Calyon terminated him for a discriminatory reason; and (2) a written policy stating that bonuses are discretionary bars any attempt to enforce an alleged oral promise to Buckman for a seven-figure bonus. For the reasons discussed below, Calyon's motion for summary judgment is granted in its entirety.

II. BACKGROUND

Buckman is a 31-year old African-American male.*fn1 Calyon is a corporate and investment bank, organized under the laws of France, and has headquarters in Paris, capital markets business activities centered in London, and offices in other locations including New York.*fn2 During all relevant times, CSI was a New York corporation and a registered U.S. broker-dealer.*fn3

A. Buckman's Background and CSI's Recruitment

After Buckman received a dual degree in Economics and Industrial Engineering from Columbia College in 2003, he was an analyst in JPMorgan Chase & Co.'s credit hybrids structuring team for two years.*fn4 In 2006, Buckman joined Societe Generale ("SocGen") as a Vice President in the structured asset sales group,*fn5 where he marketed a variety of structured credit products.*fn6 In November 2006, a headhunter, Dean Han, approached Buckman concerning a structured credit sales position at CSI.*fn7 As a result, Buckman spoke with the following CSI employees: Bertand Delaunay, the U.S. Head of Structured Credit Sales; Zain Abdullah, the U.S. Head of Credit Markets and Collateralized Debt Obligations ("CDOs"); and a few members of the New York structured credit team.*fn8 Delaunay and Buckman discussed Buckman's concern that he would lose his 2006 SocGen bonus if he joined CSI. To assuage that concern, Delaunay offered Buckman a guaranteed $275,000 bonus for 2006 if Buckman lost his 2006 SocGen bonus.*fn9 Buckman also alleges that Delaunay made an oral promise that Buckman would receive a "seven-figure bonus" for 2007 if he (Buckman) generated $15 to $20 million in sales revenue; however, Delaunay does not recall such a discussion.*fn10

On January 11, 2007, Buckman received an offer letter from CSI for the position of Vice President.*fn11 Buckman requested several changes to the offer letter -- and Calyon accepted several of those changes -- but no version of the offer letter included any reference to a "seven-figure bonus."*fn12 Buckman testified that the letter did not mention the seven-figure bonus because the necessary approvals to get such a promise in writing could take up to a month, and CSI needed him to start immediately.*fn13 Buckman's claim that he was promised a seven-figure bonus rests on his recollection of oral promises made by Delaunay and Abdullah.*fn14

Specifically, Buckman told Abdullah that he "anticipate[d] making a million dollars in 2007 [at SocGen] dot, dot, dot," and Abdullah replied "not a problem."*fn15

Buckman's headhunter did not recall any promise of a seven-figure bonus.*fn16

Buckman also alleges that several other representations Calyon made during the recruitment process were false. First, Buckman alleges that, despite representations he would have established accounts to work on, Delaunay later told Buckman that he (Buckman) would need to build new relationships or energize relationships with which others were failing.*fn17 Second, Buckman learned that Calyon was struggling financially despite prior contrary representations by Delaunay and Abdullah.*fn18 Third, Calyon's trading book of cash and synthetic products was not well balanced -- it had a large amount of unsold CDO bonds that were losing value -- contrary to prior representations by Delaunay and Abdullah.*fn19

Fourth, Delaunay and Abdullah represented that Calyon had "robust risk management processes"; however, this was not the case.*fn20

Buckman began work at CSI on January 25, 2007. On his first day, he signed a document stating that he would review and comply with the Calyon Employee Handbook ("Handbook").*fn21 It is disputed which of two versions of the Handbook Buckman received.*fn22 Both versions provided that "[m]anagement . . . may, in its discretion, grant a bonus to any or all of its employees . . . . Payment of a bonus is not guaranteed; management may choose to grant or not grant a bonus at year-end to any or all of its employees."*fn23 It is disputed whether the version of the Handbook Buckman received stated that "[n]o one is authorized to change the employee's at-will status or to make any promises of compensation or bonus, unless such a promise is contained in a written agreement signed by an authorized representative."*fn24

B. Buckman's Colleagues

Buckman worked with four other salespersons in structured credit at CSI in New York -- Aseem Srivastava, Bruce Mulder, Carl Schuman, and Delaunay.*fn25 In July 2007, Buckman requested that CSI hire a trader for the index tranche business, and CSI hired David Galludec, who is Caucasian and French.*fn26

In November 2007, David Perry was moved to sales. After Buckman told Delaunay that he (Buckman) thought that Perry was a poor performer, Delaunay allegedly responded "but he does look the part right? . . . Well, he's white. And a lot of our clients are white, so at least he has that working for him."*fn27

Throughout Buckman's time at CSI, he repeatedly complained about the behavior of two French traders located in London -- Marc Benamran and Sebastien Boucard.*fn28 Buckman attributes Benamran's and Boucard's treatment of him to race and national origin discrimination because "they had no other basis" and "the only reason I could come up with is that I was so conspicuously different from them."*fn29 Buckman alleges that Abdullah used the word "discrimination" in reference to the treatment of Benamran and Bouchard.*fn30 Specifically, Buckman complained that Benamran and Bouchard (1) sent messages in French in a Bloomberg chat room and did not switch immediately to English when Buckman requested they do so; (2) permitted an intern to act "very disrespectful[ly]" to Buckman; and (3) prevented the intern from writing trade tickets for New York transactions.*fn31

Towards the end of 2007, Buckman also had a dispute with David Eline in which each complained to Delaunay that the other was attempting to poach clients.*fn32 On January 25, 2008, Delaunay attempted to resolve the dispute by having Buckman and Eline work as a team and split sales credit for accounts they both covered.*fn33

C. Buckman's Prohibited Transaction

On January 8, 2008, Buckman executed a transaction with a counterparty, Swiss Re Financial Products Corporation ("Swiss Re"). He inadvertently failed to notice that Swiss Re was on Calyon's "Do Not Trade List" and did not obtain permission for the trade.*fn34 Buckman may have believed the Swiss Re trade was permissible because Schuman had recently completed a trade involving Swiss Re after receiving permission from management.*fn35 As a result of Buckman's policy violation, he signed a warning letter acknowledging that he "breach[ed] . . . Calyon's policies and procedures" and that "[a]ny further breach will lead to disciplinary action, up to [and] including the termination of . . . employment."*fn36 Buckman claims that Calyon did not require Tom Goodale, a Caucasian bond salesperson in London, to sign a warning letter after a "Do Not Trade" violation.*fn37

D. The Financial Crisis: Bonuses and Layoffs at Calyon

As a result of the crisis in the credit markets beginning in the summer of 2007, Calyon and its affiliates lost billions of dollars in 2007 and 2008.*fn38 Due to $350 million in trading losses, CSI's chief executive officer, Abdullah, and others were terminated in the fall of 2007.*fn39 Despite this climate, Buckman was not worried about his job and did not contribute to Calyon's losses.*fn40 Buckman performed his job well and generated $21.9 million in revenue in 2007.*fn41 During the same year, Schuman generated $74 million and Delaunay generated $69.5 million.*fn42 Buckman received a bonus of $102,848 for 2007, the highest discretionary amount awarded to a New York structured credit employee.*fn43

Srivastava produced revenue similar to Buckman and received the same bonus.*fn44

Delaunay and Schuman received no bonuses for 2007.*fn45

In April 2008, Guy Laffineur, the Head of Global Credit Market Activity, instructed Delaunay to lay off employees in New York focusing on synthetic credit products, and specifically index tranches, because Calyon and CSI were exiting these businesses.*fn46 As a result, Calyon discharged six employees in New York -- including Buckman, Galludec, and Schuman -- as well as employees in offices across Europe.*fn47 Although Calyon asserts that it stopped marketing index tranches, Buckman claims that Benamran and Boucard continued to market index tranches.*fn48 Benamran and Bouchard played no role in Buckman's discharge.*fn49

III. LEGAL STANDARD

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law."*fn50 "'An issue of fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. A fact is material if it might affect the outcome of the suit under the governing law.'"*fn51

"The moving party bears the burden of establishing the absence of any genuine issue of material fact."*fn52 "When the burden of proof at trial would fall on the nonmoving party, it ordinarily is sufficient for the movant to point to a lack of evidence to go to the trier of fact on an essential element of the non-movant's claim."*fn53 In turn, to defeat a motion for summary judgment, the non-moving party must raise a genuine issue of material fact. To do so, the non-moving party "'must do more than simply show that there is some metaphysical doubt as to the material facts,'"*fn54 and "'may not rely on conclusory allegations or unsubstantiated speculation.'"*fn55

In deciding a motion for summary judgment, a court must "'construe the facts in the light most favorable to the non-moving party and must resolve all ambiguities and draw all reasonable inferences against the movant.'"*fn56 However, "'[c]redibility determinations, the weighing of the evidence, and the drawing of ...


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