United States District Court, W.D. Louisiana, Lake Charles Division
KEITH A. ACKLEY
HONEYWELL INTERNATIONAL, INC.
REPORT AND RECOMMENDATION
KATHLEEN KAY UNITED STATES MAGISTRATE JUDGE
the court are cross-motions for summary judgment filed by
plaintiff Keith A. Ackley [doc. 72] and defendant Honeywell
International, Inc. (“Honeywell”) [doc. 66]. This
matter has been referred to the undersigned for review,
report, and recommendation in accordance with the provisions
of 28 U.S.C. § 636.
action arises from breach of contract and detrimental
reliance claims brought by Ackley against his former
employer, Honeywell, and relating to Honeywell's
cancellation of stock options granted to Ackley. Doc. 1, att.
1993 to 2009, Ackley was employed at Honeywell's office
in Lake Charles, Louisiana, as an account manager. Doc. 66,
att. 3, pp. 4-8. In July 2001 Ackley expressed job-related
frustrations to his manager, Guy Grumbles, in a phone call
and mentioned to him that he was considering looking for work
elsewhere. Id. at 13-15. According to Ackley,
Grumbles reassured him and said he would see what he could
do. Id. at 15-16. Grumbles followed up a couple of
weeks later, again by phone, and told Ackley that Honeywell
wanted to offer him stock options in the amount of 1, 000
shares in exchange for his continued employment. Id.
at 16-21. Ackley accepted, though he admitted later that he
had only a basic understanding of stock options and that he
never consulted anyone to learn more about them. Id.
alleges that it then issued a document titled “Special
Honeywell Stock Option Grant” (“Option
Grant”) and an accompanying stock option agreement
(“Option Agreement”), pursuant to a 1993 stock
plan (“Stock Plan”) sponsored by Honeywell for
its employees, to 2001 stock option recipients. See
doc. 66, att. 7 (Option Grant); doc. 66, att. 8 (Option
Agreement); doc. 66, att. 9 (Option Grant Process). The
Option Grant provided that the option would vest in stages
over the next three years. Doc. 66, att. 7. It pointed Ackley
to investment firm Salomon Smith Barney for information on
his stock options. Id. It also stated that, if
Ackley left the company due to an involuntary termination, he
must exercise any vested option by its normal expiration date
or within three years of his separation, whichever was
sooner. Id. Finally, the Option Grant instructed the
recipient to read “[t]he enclosed Option
Agreement” for “important information about your
stock option grant, ” but specified that the recipient
should keep the document for future reference and that a
signed copy did not need to be returned. Id.
Option Agreement provided that the option must be exercised
by July 15, 2011. Doc. 66, att. 8; see doc. 66, att.
2, p. 4, ¶ 17 & n. 18. Ackley, however, maintains
that Honeywell never provided the Agreement or a copy thereof
to him. Doc. 72, att. 1, p. 1, ¶ 1 (Ackley statement of
uncontested material facts); see doc. 66, att. 3,
pp. 26-27 (Ackley deposition). Honeywell disputes this and
notes that its records show that Option Agreements were
distributed to recipients of 2001 option awards, a group
which would have included Ackley, on or about July 27, 2001.
Doc. 66, atts. 6 & 9; see doc. 80, att. 2, p. 1
did not attempt to exercise his stock options during the time
he was employed at Honeywell. From July 2001 until some time
before March or April 2012, he received periodic statements
from Honeywell about his stock options which stated that he
had 1, 000 shares outstanding and describing the hypothetical
pre-tax gain of those shares. Doc. 1, att. 1, p. 5, ¶ 9;
doc. 66, att. 3, pp. 33-34. He remained employed at Honeywell
until he was involuntarily terminated on April 29, 2009, as
part of a reduction in force. Doc. 66, att. 3, pp. 8-9; doc.
66, att. 12. On that date Ackley was provided with an
employment separation agreement and release
(“Separation Agreement”), which he signed on June
10, 2009. Doc. 66, att. 12, pp. 1-7. That agreement specified
that Ackley released all claims against Honeywell arising out
of his employment or the termination thereof, including those
for incentive compensation awards. Id. at 3. A
four-page exhibit to the agreement provided a summary of
employee benefits and noted that stock options must be
exercised within “the lesser of (i) three years from
[his] Termination of Employment Date, or (ii) the full
remaining option term.” Id. at 54.
March 2012, after noticing that he had not received any
documentation relating to his stock options in some time,
Ackley first made inquiries to Honeywell in an effort to
exercise his stock options by calling Honeywell's human
resources line. Doc. 64, p. 3, ¶ 10; doc. 66, att. 3,
pp. 31-32. Honeywell compensation analyst Steven Foglyano
responded via phone and then followed up via email on April
9, 2012. Doc. 66, att. 3, pp. 32-33; doc. 66, att. 13. He
informed Ackley that the stock options had expired on July
15, 2011, pursuant to the Option Agreement.Doc. 66, att. 13.
states that he continued pursuing his stock options until his
efforts were finally rejected by Honeywell in a letter dated
October 31, 2014. Doc. 64, pp. 4-6, ¶¶ 14-17.
Ackley then filed suit against Honeywell in the 14th Judicial
District Court, Calcasieu Parish, Louisiana, on March 10,
2015, seeking to recover based on claims of breach of
contract and detrimental reliance. Doc. 1, att. 1, pp. 4-10.
Honeywell removed the suit to this court on the basis of
federal diversity jurisdiction, 28 U.S.C. § 1332. Doc.
1. Since that time, Ackley has twice amended his complaint
and Honeywell has also filed a counterclaim alleging that
Ackley breached his separation agreement by maintaining the
instant suit. Docs. 16, 27, 64. The matter is now before the
court on cross-motions for summary judgment, which have been
fully briefed and are ripe for review.
should grant a motion for summary judgment when 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.” Fed.R.Civ.P. 56. The party moving for
summary judgment is initially responsible for identifying
portions of pleadings and discovery that show the lack of a
genuine issue of material fact. Tubacex, Inc. v. M/V
Risan, 45 F.3d 951, 954 (5th Cir. 1995). The court must
deny the motion for summary judgment if the movant fails to
meet this burden. Id.
movant makes this showing, however, the burden then shifts to
the non-moving party to “set forth specific facts
showing that there is a genuine issue for trial.”
Anderson v. Liberty Lobby, Inc., 106 S.Ct. 2505,
2511 (1986) (quotations omitted). This requires more than
mere allegations or denials of the adverse party's
pleadings. Instead, the nonmovant must submit
“significant probative evidence” in support of
his claim. State Farm Life Ins. Co. v. Gutterman,
896 F.2d 116, 118 (5th Cir. 1990). “If the evidence is
merely colorable, or is not significantly probative, summary
judgment may be granted.” Anderson, 106 S.Ct.
at 2511 (citations omitted).
may not make credibility determinations or weigh the evidence
in ruling on a motion for summary judgment. Reeves v.
Sanderson Plumbing Prods., Inc., 120 S.Ct. 2097, 2110
(2000). The court is also required to view all evidence in
the light most favorable to the non-moving party and draw all
reasonable inferences in that party's favor. Clift v.
Clift, 210 F.3d 268, 270 (5th Cir. 2000). Under this
standard, a genuine issue of material fact exists if a