United States District Court, M.D. Louisiana
RICHARD L. BOURGEOIS, JR. UNITED STATES MAGISTRATE JUDGE.
the Court is Defendant's Motion to Exclude Expert
Testimony of Ralph Stephens. (R. Doc. 111). The motion is
opposed. (R. Doc. 126). Plaintiff has submitted a Supplemental
Memorandum. (R. Doc. 157).
before the Court is Defendant's Motion for Summary
Judgment. (R. Doc. 113).The motion is opposed. (R. Doc.
122). Defendant filed a Reply. (R. Doc. 140).
Plaintiff has filed a Supplemental Memorandum in Opposition.
(R. Doc 145).
about December 28, 2017, Damain Kerek
(“Plaintiff” or “Kerek”) initiated
this action against Crawford Electric Supply Company, Inc.
(“Defendant” or “Crawford”) for wages
that were allegedly owed to him under Crawford's 2016
Bonus Plan. (R. Doc. 1-1 at 3-7, “Petition”).
Crawford subsequently removed the action on the basis that
there is diversity jurisdiction under 28 U.S.C. § 1332.
(R. Doc. 1).
alleges that throughout his employment with Crawford he
participated in an annual “Bonus Plan” under
which he generally received “around 30% or more of his
total annual compensation.” (Petition ¶¶
3-4). Kerek further alleges that he worked the entirety of
the 2016 Bonus Plan's performance year, which began on
January 1, 2016 and expired on December 31, 2016, making him
eligible to receive payment of his wages under the 2016 Bonus
Plan. (Petition ¶ 5). Kerek further alleges that after
his employment was terminated, Crawford advised him that it
was refusing payment under the 2016 Bonus Plan, among other
reasons, because Kerek “did not meet the sales numbers
and expectations of the Plan.” (Petition ¶ 14).
has submitted an unsigned copy of the 2016 Bonus Plan, which
provides, in relevant part, that “All bonus payouts are
predicated upon Branch/Crawford meeting defined financial
targets. In the event that the Branch/Crawford targets are
not met, all bonus payouts will be at the discretion of the
Executive Management Team. ** No. bonus payments will be made
in any category if a minimum 3% ROS [return on sales] is not
achieved.**.” (R. Doc. 120-1) (under seal). The 2016
Bonus Plan also contains language under the section titled
“Participant Signature” stating the following:
“I have received a copy of this plan documents and
agree to participate within all terms and conditions. My
performance criteria & goals for the bonus period have
been formally established & satisfactorily conveyed to
me.” (R. Doc. 120-1) (under seal).
following facts are undisputed unless stated
otherwise. Kerek worked at Crawford from August 2013
to January 6, 2017, as the branch manager for Crawford's
location in Geismer, Louisiana (the “Kerek
Branch”). Kenny DeLaune (“DeLaune”) was the
Regional Vice President for the Louisiana Region and was
Kerek's supervisor in 2015 until Kerek's termination.
In early 2016, Kerek voiced disagreement with the provisions
of the 2016 Bonus Plan. Kerek stated in an email dated April
13, 2016, that he “cann[not] continue to sit back, sign
the plans and not at least speak up.” Christopher Tolle
(“Tolle”) informed Kerek, however, that the terms
of the 2016 Bonus Plan were not changing from what was
proposed notwithstanding Kerek's disagreement with the
proposed form. DeLaune requested that Kerek sign and return
the 2016 Bonus Plan. Kerek asserts that when Tolle and
DeLaune said that the terms of the plan were not going to be
changed, he signed the plan and handed it to DeLaune while
DeLaune was in Kerek's office. Crawford states that it
never received a signed 2016 Bonus Plan. Kerek admits that he
does not have a copy of the signed 2016 Bonus Plan. Finally,
Crawford represented at its deposition that it calculates a
branch's ROS by determining the branch's earnings
before interest and taxes (“EBIT”), less all
expenses, divided by the branch's net sales.
now moves to exclude the testimony of Kerek's expert,
Ralph Stephens, on the basis that his testimony is unreliable
in light of his accounting methodologies. (R. Doc. 111).
Central to the dispute is the application of costs associated
to Crawford's “parallel wire program” started
in July 2016 and run from Kerek's branch. Crawford argues
that it made a business decision that the costs associated to
the program would be allocated to Kerek's branch, as well
as offsetting revenue and profit related to the parallel wire
program even if sales were made by other branches. Kerek
asserts that the parallel wire product “is primarily
marketed for use in commercial and residential applications,
” and Kerek's branch, which primarily focused on
industrial customers, “would not be selling any
parallel wire products to its customers.” (R. Doc. 126
at 2). Crawford acknowledges that the primary use for
parallel wire is commercial applications. (R. Doc. 111-1 at
2). Crawford argues, however, that Mr. Stephens improperly
reallocated certain expenses related to the parallel wire
program for the sole purpose of raising Kerek's ROS to
reach the 3% requirement for the 2016 bonus. In opposition,
Kerek argues that Mr. Stephens' methodologies are
reliable, that he properly relied upon Kerek's testimony,
and that the removal of employee salaries, rent and real
estate taxes, and indirect general expenses related to the
parallel wire program from the calculation of Kerek's ROS
is appropriate because those expenses far exceeded any
revenue and profits received from the program. (R. Doc. 126).
also seeks summary judgment on the basis that Kerek's
branch failed to achieve 3% ROS and Kerek cannot prove that
the 2016 Bonus Plan was a term of his employment because he
cannot produce a signed copy of the 2016 Bonus Plan. (R. Doc.
113). In opposition, Kerek argues that his branch in fact
achieved a 3.18% ROS as calculated by Mr. Stephens. (R. Doc.
122 at 1-2). Kerek further argues, among other things, that
there was no requirement for him to sign the 2016 Bonus Plan
in order to be entitled to the bonus, that he in fact signed
the 2016 Bonus Plan, and that the Crawford's
post-termination communications acknowledge that Kerek was
subject to the 2016 Bonus Plan. (R. Doc. 112 at 2-6).
Law and Analysis
Crawford's Motion to Exclude Expert Testimony
702 of the Federal Rules of Evidence governs the
admissibility of expert testimony. Rule 702 states that a
witness “qualified as an expert by knowledge, skill,
experience, training, or education” is permitted to
(a) the expert's scientific, technical, or other
specialized knowledge will assist the trier of fact to
understand the evidence ...