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Godert v. Palo Alto Networks, Inc.

United States District Court, N.D. Texas, Dallas Division

November 30, 2017

KEVIN GODERT, AND ALL SIMILARLY SITUATED EMPLOYEES, Plaintiff,
v.
PALO ALTO NETWORKS, INC., Defendant.

          MEMORANDUM OF DECISION

          A. JOE FISH, SENIOR UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         This action was brought by the plaintiff, Kevin Godert (“Godert”), against the defendant, Palo Alto Networks, Inc. (“PAN”). Originally filed in state court, the defendant removed the case to federal court on the basis of federal question jurisdiction. Notice of Removal (docket entry 1). Although the court remanded some of the plaintiff's state law claims before trial, it retained one state law claim and one federal claim on its docket. See Memorandum Opinion and Order at 6 (docket entry 36). Specifically, the court retained Godert's breach of contract claim as well as his claim for wages and overtime compensation under the Fair Labor Standards Act (“FLSA”). See id. After a two-day bench trial on October 23 and 24, 2017, the court makes the following findings of fact and conclusions of law.

         II. FINDINGS OF FACT

         1. PAN is a technology company that emphasizes cyber security. PAN develops and sells advanced firewall systems and other applications to companies. Trial Transcript, Vol. 1, 10:22-24, 12:22-25 (docket entry 57).

         2. PAN employed Godert as a Senior Business Development Representative (“SBDR”) from October 2013 until February 2016. Joint Pretrial Order ¶ II (1, 2) (docket entry 45).

         3. Throughout the entirety of his employment with PAN, Godert worked as an SBDR in PAN's Plano, Texas Office. Trial Transcript, Vol 1, 87:15-20; Joint Pretrial Order ¶ II (6).

         4. In his position, Godert marketed the defendant's products and services to potential customers. Trial Transcript, Vol. 1, 20:9-18. One of Godert's responsibilities as an SBDR was to schedule appointments for PAN's field representatives to meet with existing and prospective customers. Trial Transcript, Vol. 1, 21:21-22:15.

         5. To facilitate sales, PAN utilizes both an inside and an outside sales team. Trial Transcript, Vol. 1, 22:11-23:10; 87:25-90:21. SBDRs and Business Development Representatives (“BDRs”), one level below the SBDRs, work on PAN's inside sales team, Trial Transcript Vol. 1, 92:8-10, while PAN employs a separate outside sales team of Field Representatives. Trial Transcript Vol. 1, 20:19-23, 22:16-23:10. Though PAN assigns different goals and responsibilities to members of the inside sales team and the outside sales team, the two teams often work cooperatively to secure a sale. Trial Transcript, Vol. 1, 88:7-90:21.

         6. Godert participated in PAN's hiring process at least once during the time of his employment, when he helped to interview a BDR candidate and was asked to provide a recommendation on whether to hire that candidate. Trial Transcript, Vol. 1, 92:6-93:23. Though Godert recommended that PAN hire the individual he helped to interview, the company did not follow his recommendation. Trial Transcript, Vol. 1-B, 23:7-20 (docket entry 58).

         7. Godert sometimes assisted PAN in training new members of the inside sales team. Trial Transcript, Vol. 1, 93:24-94:11.

         8. At all times during his employment, PAN paid Godert a salary of not less than $455 a week, which he received semi-monthly. Joint Pretrial Order ¶ II (5); Defendant's Trial Exhibit (“DTE”) 1 at PAN000041.

         9. During the course of his employment, Godert had four direct supervisors: Kelly Tulos, Christine Muir, Kevin Hemphill (“Hemphill”), and Andrew Sakelson. Trial Transcript, Vol. 1, 20:24-21:15, Vol. 1-B, 29:14-23.

         10. During Godert's employment, Joshua Hoffman was, and still is, PAN's Vice President of Global Inside Sales. Trial Transcript, Vol. 1-B, 112:12-13.

         11. All insides sales personnel, including Godert, received a light-weight, portable laptop, and both inside and outside sales representatives were permitted to seek reimbursement for their work-related cell phone charges. Trial Transcript, Vol. 1-B, 37:23-39:14.

         12. Godert's normal routine while with PAN was to arrive at the office around 7:00 a.m. and leave around 3:00 p.m. or 4:00 p.m. Trial Transcript, Vol. I, 102:19-103:5. See DTE 24-25.

         13. In addition to receiving a fixed salary, Godert also received commissions. See, e.g., Plaintiff's Trial Exhibit (“PTE”) 3 at PAN000080. Palo Alto's Employee Handbook stated that PAN reserved the “right to revise, modify, delete, or add to any and all policies, procedures, work rules, or benefits” stated in the handbook or any other document. DTE 14 at PAN000151.

         14. Godert received commissions when he set an appointment for a client to meet with an outside sales representative and the appointment was kept. Trial Transcript, Vol. 1, 32:18-20. During Godert's employment, PAN switched its plan from paying SBDRs a commission on just “appointments kept” to paying them for “appointments kept” and through a “pipeline” program. See Trial Transcript, Vol. 1, 36:21-38:5.

         15. SBDRs received pipeline-based commissions when outside sales representatives changed the client's status to an ...


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