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James Giller v. Oracle Usa

February 14, 2012


The opinion of the court was delivered by: John G. Koeltl, District Judge:


The plaintiff/petitioner, James Giller, brought this petition to confirm in part and vacate in part an arbitration award that resolved an employment dispute between Giller and his former employer, the defendant/respondent, Oracle USA. Oracle now moves pursuant to Federal Rule of Civil Procedure 12(b)(6)to dismiss the claims in the petition that seek to vacate the parts of the award that were favorable to Oracle. The Court has subject matter jurisdiction in this case pursuant to 28 U.S.C. § 1332.


In deciding a motion to dismiss pursuant to Rule 12(b)(6), the allegations in the Complaint are accepted as true, and all reasonable inferences must be drawn in the plaintiff's favor. McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 191 (2d Cir. 2007). The Court's function on a motion to dismiss is "not to weigh the evidence that might be presented at a trial but merely to determine whether the complaint itself is legally sufficient." Goldman v. Belden, 754 F.2d 1059, 1067 (2d Cir. 1985). The Court should not dismiss the Complaint if the plaintiff has stated "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). While the Court should construe the factual allegations in the light most favorable to the plaintiff, "the tenet that a court must accept as true all of the allegations contained in the Complaint is inapplicable to legal conclusions." Id.

When presented with a motion to dismiss pursuant to Rule 12(b)(6), the Court may consider documents that are referenced in the Complaint, documents that the plaintiffs relied on in bringing suit and that are either in the plaintiff's possession or that the plaintiff knew of when bringing suit, or matters of which judicial notice may be taken. See Chambers v. Time Warner, Inc., 282 F.3d 147, 153 (2d Cir. 2000); see also City of Roseville Emps.' Ret. Sys. v. Energysolutions, Inc., No. 09 Civ. 8633, 2011 WL 4527328 at *1-2 (S.D.N.Y. Sept. 30, 2011).


The following allegations are assumed to be true for the purposes of this motion unless otherwise stated.

Giller worked as Consulting Sales Manager for Oracle between February 2005 and April 2008. (Pet. to Confirm in Part & Vacate in Part the Arb. Award ¶ 1; Pet. Ex. A ("Award"), at 2.) Giller worked on a long-term master technology agreement between Oracle and the City University of New York ("CUNY") that closed on May 31, 2007. (Award, at 3-4.) Although the parties expected that the agreement eventually would involve $135 million of sales for Oracle, this was merely a projection of the contract's potential value. (Award, at 3-4; Pet. ¶ 9.) CUNY, as a public institution, could not sign a contract that bound it for longer than one year. (Pet. ¶ 9.) The $135 million represents the projected value of CUNY's expected purchases over five or six years. (Award, at 4; Pet. ¶ 9.) In 2007, CUNY purchased $20 million worth of services from Oracle. (Award, at 4; Pet. ¶ 9.) Although both Oracle and CUNY expected that CUNY would sign purchase orders in each of the following four or five years, CUNY was not obligated to do so and there was no such guarantee. (Award, at 4; Pet. ¶ 9.)

As a Consulting Sales Manager, Giller received commissions for sales that he booked at a rate determined annually by Oracle. (Award, at 4; Pet. ¶ 6; Decl. of Gary M. Meyers in Opp. to Mot. to Dismiss Pet. ("Meyers Decl.") Ex. 2A ("Compensation Plan"), at 3-20.) Giller received commissions from the 2007 CUNY transaction based not on the $135 million that included all expected future sales, but on $18 million of the initial $20 million purchase. (Award, at 4.) After the close of its 2007 fiscal year, Oracle placed a retroactive cap on the amount of money Giller could receive as payment for commissions for that year. (Award, at 7-9, 12; Pet. ¶ 10.)

For the year following Giller's booking of the CUNY transaction, Oracle significantly increased Giller's sales target, which resulted in a decrease in his commission rate. (Award, at 15-16.) Oracle also reduced Giller's sales territory. (Pet. ¶ 20.) Giller also alleges that his managers treated him poorly, that Oracle wished to "manage him out of the company," and that Giller was not a part of their long range plans. (Pet. ¶¶ 22-25.) Giller resigned from Oracle in April 2008. (Pet. ¶ 25.)

Giller's employment relationship with Oracle was governed by a broad Employment Agreement and Mutual Agreement to Arbitrate. (Decl. of Christopher J. Collins in Supp. of Mot. to Dismiss Ex. 2 ("Agreement").) That Agreement, which is dated January 16, 2005, provides:

You and Oracle understand and agree that any existing or future dispute or claim arising out of or related to your Oracle employment, or the termination of that employment, will be resolved by final and binding arbitration and that no other forum for dispute resolution will be available to either party, except as to those claims identified below. The decision of the arbitrator shall be final and binding on both you and Oracle and it shall be enforceable by any court having proper jurisdiction. (Agreement.) None of the exceptions to arbitration applied, and Giller submitted his employment dispute to an arbitrator in an Employment Arbitration Tribunal of the American Arbitration Association as provided for in the Agreement.

Giller filed three claims against Oracle in the arbitration. (Meyers Decl. Ex. 2 ("Stmt. of Claim") ¶¶ 17-31.) The first claim for fraudulent inducement was dismissed by the arbitrator on summary judgment and is not at issue here. (Award, at 1.) Giller's second claim sought to recover commission payments on the entirety of the potential $135 million purchase order with CUNY. (Stmt. of Claim ¶¶ 22-26.) Giller claimed that the failure to pay him a commission on the entire amount of $135 million was a breach of contract or a breach of the implied covenant of good faith and fair dealing. (Statement of Claim ¶¶ 22-26.) Giller's third claim sought to recover for discrimination on the basis of age. (Statement of Claim ¶¶ 27-31.) Giller argued that the increased sales target and resulting decreased rate of commission, and other actions undertaken by Oracle created an intolerable work atmosphere that amounted to constructive discharge. (Statement of Claim ¶¶ 9-15.) Giller alleged that this adverse employment action was motivated by discrimination on the basis of his age. (Statement of Claim ¶¶ 27-31.)

In a thorough decision, following a three day evidentiary hearing, the arbitrator found that the retroactive cap placed on Giller's commissions constituted a breach of contract and awarded him $99,355. (Award, at 12-13.) However, the arbitrator found in favor of Oracle on the remainder of Giller's contract claim, including Oracle's determination that Giller was not entitled to receive a commission for the higher, projected amount of the CUNY transaction until Oracle actually "booked" a CUNY payment for that amount. (Award, at 12.) The arbitrator found that Oracle's Compensation Plan entitles Consulting Sales Managers to receive commissions when the client executes a purchase order and that Oracle does not pay commissions for future or expected purchases. (Award, at 13.) While the arbitrator agreed that Oracle breached its contract with Giller by retroactively reducing the commission he ...

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