Opinion
CIVIL ACTION NO. 03-0388
March 2, 2004
MINUTE ENTRY
Before the Court is a Motion for Partial Summary Judgment (Rec. Doc. 33) filed by plaintiffs George P. Hebbler, Jr., Thomas M. Young, and Greg C. Fuxan. Having reviewed the pleadings, memoranda, exhibits, and having heard oral argument, the Court GRANTS IN PART and DENIES IN PART plaintiffs' motion.
I.BACKGROUND
This lawsuit stems from the forced liquidation of the law firm of Turner, Young, Hebbler Babin, A.P.L.C. ("Lawfirm") commencing June 1, 2002 at the hands of its majority shareholder, defendant Emile L. Turner, Jr., over the objection of certain employees and shareholders, namely, plaintiffs George P. Hebbler, Jr. and Thomas M. Young, and Greg C. Fuxan. In their suit, Hebbler, Young and Fuxan assert various breach of fiduciary duty claims relating to the pre-liquidation affairs of the firm and to the handling of the liquidation by Turner, as self-appointed liquidator, as well as certain claims for unpaid compensation and for a distribution to Hebbler and Young of the value of their ownership interest in the firm. Only the claims for unpaid compensation are the subject of the instant Motion for Partial Summary Judgment. In short, plaintiffs seek compensation for fees earned prior to liquidation but collected after liquidation.
Plaintiff's and defendant Turner were employed as attorneys at Lawfirm, which Turner founded and in which he maintained a majority ownership interest of seventy percent (70%). Plaintiff's contend that, although there were no written employment agreements between them and the firm, a verbal agreement existed as to the compensation each was to be paid. According to plaintiffs, that compensation had three components: (1) guaranteed monthly salary draws, (2) "mandatory" bonuses, and (3) "discretionary" bonuses. Defendant insists that the only employee compensation guaranteed to plaintiffs was the annual salary described as monthly draws.
Plaintiff's were compensated according to the following system. Turner, Hebbler, Young and Fuxan would each receive a set amount on a monthly basis as a "draw." In addition, the annual draw of "profitable" partners would be raised to the level of the highest draw received by any Lawfirm partners and "profitable" partners would receive "mandatory" bonuses at year end, based on the net profits of the firm for that year. To determine "profitability," all of the expenses attributable directly to each partner (e.g., their own draw and the salaries of their secretary and paralegal, if any) and a share of the general expenses of the firm were subtracted from the total collected fees on cases managed and handled by that partner. The resulting number was deemed indicative of their "profitability" (or loss) for the year. One-half of the resulting number would be the "mandatory" bonus which that "profitable" partner would receive.
Remaining Lawfirm net profits were also distributed to the "profitable" partners as a "discretionary" bonus. Although the manner of computation of the "discretionary" bonus changed over the years, a "discretionary" bonus was paid to "profitable" partners most years. Thus, plaintiffs suggest that this bonus was discretionary only in terms of how it was calculated, not whether it was paid. Beginning in the late 1990s, the "discretionary" bonus was calculated under a formula (the "Babin Formula") created by Wilbur J. "Bill" Babin, Jr., a former Lawfirm minority shareholder, which apportioned those funds to the "profitable" partners based on the percentage of the firm's total net profit that they "brought in."
Defendants state that Turner, as Lawfirm founder and majority shareholder, maintained control over compensation decisions at all times, and that all bonuses, whether termed "mandatory" or "discretionary," were the result of his unilateral discretion. While Turner admits to issuing bonuses in accord with Babin's suggested system, he denies that his adherence to the Babin Formula arose out of a compensation agreement that bound plaintiffs and defendants.
On May 31, 2002, Turner liquidated Lawfirm. Plaintiff's filed a Complaint (Rec. Doc. 1) in this Court on February 7, 2003, and, on January 20, 2004, submitted the instant Motion for Partial Summary Judgment. The Court heard oral argument on plaintiffs' motion on February 9, 2004. The instant motion prays for the Court to hold that:
(1) an oral employment/compensation agreement existed between plaintiffs and defendants;
(2) plaintiffs are entitled to further compensation under that agreement for work performed prior to May 31, 2002, from fees collected by defendant after that date; and,
(3) plaintiffs are entitled to relief under the Louisiana Wage Statute.
II. LEGAL STANDARDS
A. Summary Judgment
Summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). "Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). Substantive law determines the materiality of facts, and "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The moving party "bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of [the record] . . . which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp v. Catrett, 477 U.S. 317, 323 (1986). Once the movant meets this burden, the burden shifts to the non-movant "to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 322. "[M]ere allegations or denials" will not defeat a well-supported motion for summary judgment. Fed.R.Civ.P. 56(e). Rather, the non-movant must come forward with "specific facts" that establish an issue for trial. Id.
When deciding a motion for summary judgment, the Court must avoid a "trial on affidavits. Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts" are tasks for the trier-of-fact. Anderson, 477 U.S. at 255. To that end, the Court must resolve disputes over material facts in the non-movant's favor. "The party opposing a motion for summary judgment, with evidence competent under Rule 56, is to be believed." Leonard v. Dixie Well Service Supply, Inc., 828 F.2d 291, 294 (5th Cir. 1987).
The party opposing summary judgment cannot manufacture a genuine issue of material fact by submitting an affidavit that directly contradicts his prior testimony. S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 495 (5th Cir. 1996). He may, however, supplement or explain his previous statements. Clark v. Resistoflex Co., 854 F.2d 762, 766 (5th Cir. 1988). He may "clarif[y] or amplif[y] the facts by giving greater detail or additional facts not previously provided in the deposition." S.W.S. Erectors, 72 F.3d at 496. What he may not do is "tell [ ] the same story differently." Id. "To the extent they exist, discrepancies in those averments present credibility issues properly put to the trier-of-fact. Credibility assessments are not fit grist for the summary judgment mill." Dibidale v. American Bank Trust Co., 916 F.2d 300, 307-08 (citation omitted); see Carter v. Bisso Marine Co., Inc., 238 F. Supp.2d 778, 789 (E.D. La. 2002). B. Louisiana Wage Statute
The Louisiana Wage Statute, Louisiana Revised Statute 23:631, requires that upon the discharge or resignation of an employee it shall be the duty of the employer to pay by the next regular payday or within fifteen days the amount then due under the terms of employment. That statute provides in pertinent part:
Upon the discharge of any laborer or other employee of any kind whatever, it shall be the duty of the person employing such laborer or other employee to pay the amount then due under the terms of employment, whether the employment is by the hour, day, week, or month, on or before the next regular payday or no later than fifteen days following the date of discharge, whichever occurs first . . .
Upon the resignation of any laborer or other employee of any kind whatever, it shall be the duty of the person employing such laborer or other employee to pay the amount then due under the terms of employment, whether the employment is by the hour, day, week, or month, on or before the next regular payday for the pay cycle during which the employee was working at the time of separation or no later than fifteen days following the date of resignation, whichever occurs first . . .
Payment shall be made at the place and in the manner which has been customary during the employment. . . .
La. Rev. Stat. 23:631(A). Louisiana Wage Statute § 632 imposes penalties and attorney fees on an employer who fails to comply with the directives of § 631, providing:
Any employer who fails or refuses to comply with the provisions of R.S. 23:631 shall be liable to the employee either for ninety days wages at the employee's daily rate of pay, or else for full wages from the time the employee's demand for payment is made until the employer shall pay or tender the amount of unpaid wages due to such employee, whichever is the lesser amount of penalty wages. Reasonable attorney fees shall be allowed the laborer or employee by the court which shall be taxed as costs to be paid by the employer, in the event a well-founded suit for any unpaid wages whatsoever be filed by the laborer or employee after three days shall have elapsed from time of making the first demand following discharge or resignation.
The Louisiana Wage Statute is penal in nature and must be strictly construed. Boudreaux v. Hamilton Medical Group, 644 So.2d 619, 621 (La. 1994) (citing Mitchell v. First National Life Insurance Co. of La., 236 La. 696, 109 So.2d 61, 63 (La. 1959); Clevy v. O'Meara, 236 La. 640, 108 So.2d 538, 539 (La. 1959)). In Boudreaux v. Hamilton Medical Group, the Louisiana Supreme Court held that La. Rev. Stats. 23:631 and 23:632 refer strictly to wages:
Since the phrase in La.R.S. 23:631 "any amount then due under the terms of employment" is modified by the phrase "whether the employment is by the hour, day, week, or month" (pay period), it is obvious that "the amount then due under the terms of employment" set forth in La.R.S. 23:631 refers to wages which are earned during a pay period. In other words, "terms of employment" refers to a particular pay period. Therefore, only compensation that is earned during a pay period will be considered wages under the statutes. This interpretation is consistent with the references to "wages" throughout the statutes.Boudreaux, 644 So.2d at 622. In restricting the statute to wages, the court stated, "if the statute is intended to cover all amounts due by the employer to the employee, regardless of whether they are wages, there is no need for the statute to specify the pay periods of wages." Id. (quoting Stell v. Caylor, 223 So.2d 423, 426 (La.App. 3rd Cir. 1969), writ denied, 254 La. 778, 226 So.2d 770 (La. 1969). The United States Fifth Circuit, in Batiansila v. Advanced Cardiovascular Systems, has expressly recognized that bonuses are not regulated by the Louisiana Wage Statute. 952 F.2d 893, 896 n. 7 (5th Cir. 1992) ("[B]onuses are not covered by the statute, but commissions are within the intent of the statute.")
III. ANALYSIS
A. Employment/Compensation Agreement
Essentially, plaintiffs assert that defendant Turner, acting on behalf of Lawfirm, entered into an oral employment agreement with plaintiffs that guaranteed plaintiffs a minimum salary and an additional portion of the fees and profits plaintiffs generated, i.e., bonuses. Young, Turner, and Fuxan claim, based on their oral employment/compensation agreement, that they are due portions of fees generated before liquidation but collected after that event.
Analyzing plaintiffs' motion begins with a review of employment contract form requirements. While Louisiana law requires that certain agreements be in a particular form, it does not prescribe any particular form for employment or compensation agreements between employers and employees.
Consequently, an unwritten agreement, such as the one alleged between plaintiffs Hebbler, Young and Fuxan and defendants Turner and Lawfirm is valid and enforceable. See, e.g., DuTreil v. Dinon Precast, Inc., 612 So.2d 143 (La.App. 5th Cir. 1992) (enforcing oral compensation agreement); Miller v. Harvey, 408 So.2d 946 (La.App. 2nd Cir. 1981) (enforcing oral contract); Vardaman Co., Inc. v. Ponder, 443 So.2d 697 (La.App. 1st Cir. 1983) (enforcing oral contingency fee contract). Louisiana law requires only that an oral contract for an amount in excess of $500 be proven by one credible witness and other corroborating circumstances. La. Civ. Code art. 2277.
In the case at bar, the existence of an oral employment/compensation agreement is supported by the deposition testimony of defendant Turner and of plaintiffs Young and Hebbler. Their testimony is corroborated by the fact that compensation was, in fact, paid in accordance with such an agreement. At his deposition, defendant Turner testified as follows:
Q: [T]here were employees, so there was some employment agreement between the employees and the firm, is that correct?
A: Yes.
Q: And it would be verbal as opposed to written?
A: I would think so.
* * *
Q: At some juncture, either — I think it was the early '90s, I asked Tom Young to in someway create a mandatory bonus system so that everybody would know what they could expect besides their draw or salary and they would know how much of the profits that they would get, and then there would be a discretionary portion over and above that hopefully.
So when it got to be that — I think it was either '90, '91 or '92, the mandatory bonus system came in and I participated in that.
* * *
Later on in the late '90s, Billy Babin came up with an idea in regards to how to handle the discretionary, and he suggested that we do it on the percentages of who brought in the most profit and then percentage it down, which is what I termed to be nothing more than an extension of the mandatory bonus. That stayed in effect for a few years.
. . . It was used in 2001. I believe it was used in 2000. I think it was used in 1999.
Q. This was Billy's suggestion?
A. Yes, Billy's suggestion, and I had no objections to it.
Turner deposition, pp. 16, 21-23. Clearly, defendant Turner and plaintiffs entered into an employment/compensation contract during the course of practicing law together at Lawfirm. This Court finds no genuine issue of material fact regarding the existence of an oral agreement between plaintiffs and defendants regarding employment compensation.
Having held that an oral employment agreement between plaintiffs and defendants existed, the Court turns to the issue of whether plaintiffs are entitled to further compensation under that agreement for work performed prior to liquidation from fees collected by defendants after May 31, 2002. As discussed above, plaintiffs allege that the employment agreement provided for the following three sources of guaranteed compensation: (1) monthly draws, (2) "mandatory" bonuses, and (3) "discretionary" bonuses. Defendants do not dispute that monthly draws were guaranteed under the oral employment agreement. In fact, defendant Turner, as liquidator, has paid plaintiffs their guaranteed draws for 2002. As to "mandatory" and "discretionary" bonuses, defendant avers that neither was guaranteed under the oral employment agreement.
In support of their claims regarding "mandatory" bonuses, plaintiffs refer to the aforementioned portion of defendant Turner's deposition, whereby Turner testified that "I asked Tom Young to in someway create a mandatory bonus system so that everybody would know what they could expect besides their draw or salary and they would know how much of the profits that they would get . . . the mandatory bonus system came in and I participated in that." Turner deposition, pp. 21-22. Plaintiff's also point out that mandatory bonuses were, in fact, issued in accordance with Tom Young's suggestion each year. Plaintiff argues that Turner's own testimony, corroborated by Lawfirm's course of dealings, is sufficient to merit partial summary judgment as to the existence of a mandatory bonus agreement and to the method of compensation. Defendants dispute this contention on the grounds that there was no meeting of the minds as to the terms of the agreement. See Stockstill v. C. F. Industries. Inc., 94-2072, 665 So.2d 802 (La.App. 1 Cir. 12/15/95). In support of this argument, defendant offers Turner's affidavit, which states that Turner believed that only the monthly draws were guaranteed under the agreement and that, as majority shareholder and Lawfirm founder, Turner retained ultimate authority over all other compensation decisions. The Court disagrees with defendants and finds that mandatory bonuses were guaranteed under the oral employment contract. "Mandatory" is defined as "containing or constituting a command: obligatory." Merriam-Webster's Collegiate Dictionary (10th Ed. 1999). Defendant Turner, an accomplished attorney, must have known this term's common usage when he affixed it to the type bonuses distributed in accordance with plaintiff Young's system. Furthermore, Lawfirm's practice in awarding "mandatory" bonuses was consistent with the term's literal meaning. Each year plaintiffs were "profitable," they received one-half of their "profitability" total as a "mandatory" bonus. Thus, defendant Turner and plaintiffs achieved a meeting of the minds regarding the guaranteed nature of "mandatory bonuses." Based on Turner's own testimony and on the practice of Lawfirm in distributing "mandatory" bonuses, this Court finds that no genuine issue of material fact exists regarding the "mandatory" bonus aspect of the oral employment/compensation agreement.
In addition to the aforementioned testimony, plaintiffs offer the following portion of Turner's deposition:
Q: Now, you don't disagree, do you, that every penny that came in subsequent to May 31, 2002 was generated by work performed by members of the law firm prior to May 31, 2002.
* * *
A: I would admit to you that it was work in progress.
Q: Or a receivable.
A: Or a receivable.
* * *
Q: . . . I just want to confirm as liquidator you collected receivables that were on the books as of May 31, 2002 after May 31, 2002.
A: Yes.
Q: You also billed work in process that was create — on the books as of May 31, 2002 at some point after May 31, 2002.
A: Yes.
Q: And you collected for those bills on the work — the work in process generated bills that then was collected after May 31, 2002 for work put on the books before May 31, 2002.
A: The work in progress, we billed it. We tried to collect it.
Q: Right. And you've done a pretty good job because as the records I see show, there's not a lot of receivable left.
A: No, there aren't.
Turner Deposition, at pp. 126-28, 212-16. Plaintiff's contend that, although Lawfirm ceased to operate after May 31, 2002, its income continued thereafter and plaintiffs should share in that income under the employment agreement. This income consisted of work in progress which was subsequently billed and collected or receivables extant on May 31, 2002, which was subsequently paid. This work in process and accounts receivable was the result of the work performed, in large part, by Hebbler, Young and Fuxan, as members of the firm, prior to May 31, 2002. All that remained to be done after that date was some billing and collection of fees for services rendered on or before May 31, 2002.
Plaintiff's are entitled to compensation based on fees collected after May 31. 2002, for work performed before that date. In Howser v. Carruther Mortgage Corp., 476 So.2d 830 (La.App. 5th Cir. 1985), Louisiana's Fifth Circuit found that a loan originator was entitled to an origination fee for a loan originated prior to her resignation but for which the fee was not collected within the 90-day period which her agreement with the employer required in order for her to receive payment therefor. That court held that the fee had been earned at the time of the plaintiff's resignation. In that case," . . . the only work remaining on the loan at the time of plaintiffs resignation was the actual collection of the fee, and once plaintiff resigned, it was beyond her control whether the money would be collected within the time period outlined in the ILOIP." Id. at 834. Similarly, in Patterson v. Alexander Hamilton, Inc., 844 So.2d 412 (La.App. 1st Cir. 2003), Louisiana's First Circuit determined that a sales associate was entitled to commissions and bonuses for sales made during the employment but which were not billed until after his employment terminated. The Court observed:
[w]hen commission sales are at issue, the inquiry of whether a wage was actually earned focuses on what work associated with the sale remained at the time of [termination].' Where only collection of the fee is outstanding and collection is beyond the control of the employee, the employee has earned his commission pursuant to La. R.S. 23:634. . . . However, if a substantial amount of time and effort are needed to complete a sale, then the right to a commission may not have been earned.Patterson, 844 So.2d at 416.
Although the instant matter relates to bonuses rather than commissions, the profitability contingency inherent Lawfirm's "mandatory" bonuses mandate that the Howser and Patterson rationales apply here. As in those cases, only the billing and collection of the fees earned prior to liquidation remained to be done here. Hebbler, Young and Fuxan, like Ms. Howser and Mr. Patterson, are entitled to compensation for work performed prior to the termination of their employment, even though the fees for their work were not billed and/or collected until after their employment terminated.
Defendants contend that plaintiffs are not entitled to any further payments of a mandatory bonus because any monies due have been paid already. According to Turner, since the "mandatory" bonus was conceived of in the early 1990s, it has always been based on the fees actually collected by Lawfirm as of the close of books. Turner affidavit at 13. Fees that were billed prior to the close of books, but not actually collected, were not included in any of the Corporation's bonus calculations. In line with this historical practice, Lawfirm closed its books due to voluntary liquidation on May 31, 2002, and paid mandatory bonuses on fees collected prior to liquidation and the close books. Defendants aver that this payment satisfied any potential employment/compensation contract liability.
Defendants support this argument with a 1952 Louisiana Supreme Court case, McLellan v. F.N. Johnston, Inc., 62 So.2d 504 (La. 1952). In McLellan, the plaintiff claimed that at the conclusion of his employment, he should have been paid for commissions earned but not yet paid by the customer to the corporation. The court found that the prior actions of the parties in relation to the computation of payment precluded such an argument. During the four years that plaintiff was working for the corporation, compensation was always figured on the basis of the commissions "actually earned and received during the fiscal year." Id. at 506. Therefore, the court held that the plaintiff was not entitled to compensation for commissions that were received by the corporation after his employment ended. Id. Likewise, defendant argues, the instant plaintiffs are not entitled to any bonus based on monies collected after their employment ended. Rather, the accounts receivable and work in progress on the Corporation's books as of the date of its liquidation are the property of the shareholders, to be shared according to their respective interests just as contemplated by the shareholders agreements. The Court disagrees.
The instant facts diverge from the McLellan scenario, rendering that dated case inapplicable. We do not have here employees who left a functioning place of employment demanding early bonus payments. Rather, this case addresses former employees whose employment ceased as a result of a liquidation prompted by the majority shareholder months before the usual close of books. Plaintiffs bonus demands do not alter Lawfirm's course of dealing any more than defendants' unilateral liquidation did. Also, defendants' attempts to invoke the terms of various shareholders agreements here are misplaced. The shareholders agreements are immaterial to this motion because, even if applicable to liquidation proceedings, they do not nullify or supercede the employment agreement at issue here. This motion pertains only to funds due under the employment/compensation agreement.
Although plaintiffs' employment contract did not speak specifically to liquidation procedures, it did establish a precedent that plaintiffs were entitled to a portion of the funds they generated. Despite Lawfirm's compensation contract with plaintiffs being unclear in other regards, the evidence supports that "mandatory" bonuses should be paid in some fashion for work performed by plaintiffs while they were employed by Lawfirm but for which collections had not yet been undertaken. Thus, the Court holds that fees collected after May 31, 2002, on work done by plaintiffs prior to liquidation should be included in plaintiffs' mandatory bonus calculation.
As to plaintiffs' claims for "discretionary" bonuses, the Court finds that a genuine issue of material fact exists as to whether such bonuses were guaranteed under the employment contract. Again, word choice is highly relevant. "Discretionary" means "left to discretion: exercised at one's own discretion." Merriam-Webster's Collegiate Dictionary (10th Ed. 1999). "Discretion" is defined as "individual choice or judgment: power of free decision or latitude of choice." Id. The word "discretionary" is, in fact, the antithesis of "mandatory." The obvious implication of describing a type of bonus as "discretionary" is that such a bonus is not guaranteed, but is rather the product of some authority's "latitude of choice."
The common usage of the term "discretionary" and the testimony of the parties indicate an uncertainty as to whether a meeting of the minds was achieved with regard to guaranteeing "discretionary" bonuses. Plaintiff's were admittedly aware that Turner believed that he was in control of the compensation determination. For example, plaintiff Hebbler testified that he knew all along that Turner believed he had control over the Corporation's payment of monies at the close of books. Hebbler's testimony regarding Turner's mind-set was corroborated in fact by Turner's conduct in 1999 when he decided that Lawfirm would retain $175,000 of its earnings rather that distribute those monies as "discretionary" bonuses. This fact, along with other variances from the Babin Formula, contradicts plaintiffs' argument that defendants were bound by a fixed compensation formula regarding "discretionary" bonuses.
In addition to Lawfirm's inconsistent adherence to the Babin Formula and plaintiff Hebbler's deposition, plaintiff Young's testimony serves to create an issue of material fact as to whether Babin Formula "discretionary" bonuses were obligatory. Young testified as follows:
A. [T]here were times when I was not in profit, that I got more than a hundred thousand dollars.
Q. And you got a bonus, even though you weren't in profit?
A. Correct.
Q. Okay.
* * *
Q. That's what I was getting to. In fact, from 1992 through 2001, you sometimes received discretionary bonuses when your revenues, minus your share of common and direct expenses, resulted in a negative figure; did you not?
A. Correct.
* * *
Q. So that there was no writing or no formula telling them how to do it; was there?
A. No.
* * *
A. Here's what it was: The discretionary bonus, whatever they amounted to, were discretionary.
Young deposition at 107-108, 115. Although plaintiffs have produced evidence suggesting that defendant Turner and Lawfirm contractually relinquished the authority to choose "discretionary" bonus amounts, the facts and testimony discussed above sufficiently establish a genuine issue of material fact. Thus, the Court declines to grant summary judgment on the issue of discretionary bonuses. B. Louisiana Wage Statute
In addition to contract claims, plaintiffs seek relief under the Louisiana Wage Statute, La. Rev. Stat. 23:631, et seq. Hebbler, Young and Fuxan maintain that "bonuses," such as those at issue here, fall within the ambit of the Louisiana wage state. See, e.g., Thomas v. Orleans Private Industry Council, Inc., 669 So.2d 1275 (La.App. 4th Cir. 1996); Fender v. Power Structures, Inc., 359 So.2d 1321 (La.App. 4th Cir. 1978); Cochran v. American Advantage Mortgage Co., Inc., 638 So.2d 1235 (La.App. 1st Cir. 1994). Further, plaintiffs aver that courts have routinely held that compensation earned prior to termination of employment, even if not payable until after termination, are required to be paid under the wage law. The Court disagrees.
To begin, the Court notes, sua sponte, that this lawsuit does not result from defendants discharging plaintiffs from employment at Lawfirm or from plaintiffs' resignation. Rather, the instant action arises out of a corporate liquidation and the resulting cessation of employment. As such, La. Rev. Stat. 23:631 does not apply because there has been no "discharge of any laborer or other employee" or "resignation of any laborer or other employee," as required by the statute. See La. Rev. Stat. 23:631(A)(1)(a) and (A)(1)(b). Furthermore, plaintiffs claims for Louisiana Wage Statute seek relief beyond the strictly construed confines of this penal statute. Finally, the state appellate court jurisprudence cited by plaintiffs in support their wage statute claims is both non-binding and unpersuasive in light of the distinct facts at bar. Consequently, the Court holds that the Louisiana Wage Statute is inapplicable to the instant matter.
Because the Louisiana Wage Statute is penal in nature and therefore subject to strict interpretation, the Louisiana Supreme Court has held that La. Rev. Stat. 23:631 et seq. applies strictly to wages. Boudreaux, 644 So.2d at 622. This Court has adopted that reasoning. See Bass v. Amite Independent School District, 1996 WL 117501 (E.D.La. 1996). In Boudreaux, the court explicitly rejected the notion that the Louisiana Wage Statute was intended to cover all amounts due by the employer to the employee, regardless of whether they are wages. Taking that analysis one step further, the United States Fifth Circuit, in Batiansila, has expressly recognized that bonuses, as opposed to commissions, are not regulated by the Louisiana Wage Statute. 952 F.2d 893, 896 n. 7 (5th Cir. 1992). The instant matter, in which plaintiffs seek to be paid "mandatory" and "discretionary" bonuses for work done prior to liquidation, pertains to bonuses rather than wages or commissions. Consequently, the Louisiana Wage Statute does not apply and plaintiffs are not, therefore, entitled to attorneys' fees under La. Rev. Stat. 23:632. The Louisiana Court of Appeal cases cited by plaintiffs in support of wage statute applicability do not persuade this Court. Those cases are distinguishable in that they apply to employment commissions and origination fee wages rather than bonuses. Thus, the Louisiana Wage Statute is inapplicable to the case at bar. Plaintiff's' Motion for Partial Summary Judgment is denied insofar as it seeks attorneys' fees and other remedies under La. Rev. Stat. 23:631 et seq.
IV. CONCLUSION
In sum, plaintiffs' Motion for Partial Summary Judgment seeks the following forms of relief: (1) a holding that an oral employment/compensation agreement existed; (2) a finding that plaintiffs are due further compensation under that agreement for work performed prior to liquidation; (3) and a ruling that the Louisiana Wage Statute, La. Rev. Stat. 23:631 et seq., applies to plaintiffs claims. This Court grants plaintiffs' request as to the existence of a contract, denies their prayer for the application of the Louisiana Wage Statute, and grants in part and denies in part the portion of their motion seeking a determination whether plaintiffs are due further compensation under the agreement. The Court holds that no genuine issue of material fact exists as to whether an agreement regarding employment and compensation existed, or whether that agreement entitled plaintiffs to a guaranteed monthly draw and genuinely mandatory bonuses. Plaintiff's are entitled to bonuses on work done prior to May 31, 2002, but collected thereafter, as computed under the mandatory bonus system in place during the years preceding liquidation. This total will be calculated at trial. Plaintiff's have not, however, satisfied their burden in proving that Lawfirm's "discretionary" bonuses were also guaranteed. Therefore, plaintiffs' motion is denied to the extent that it seeks a judgment that "discretionary" bonuses are due. Finally, the Louisiana Wage Statute is inapplicable to the instant facts because bonuses are not governed by the statute. Accordingly,
IT IS ORDERED that plaintiffs' Motion for Partial Summary Judgment (Rec. Doc. 33) is hereby GRANTED IN PART and DENIED IN PART.