United States District Court, S.D. Texas, Houston Division
JOSEPH F. BEGGINS, Plaintiff,
CBRE CAPITAL MARKETS OF TEXAS L.P., Defendant.
MEMORANDUM AND OPINION
Rosenthal Chief United States District Judge
case is about whether the plaintiff, Joseph Beggins, was
entitled to receive more than half a million dollars when his
employment ended. Beggins was a seconded chief executive
officer for GEMSA Loan Services, a partnership between
General Electric and the defendant, CBRE Capital Markets of
Texas, L.P. When General Electric decided to leave the
partnership, CBRE offered Beggins a retention bonus if he
agreed to oversee the transition for the rest of the year.
Beggins did oversee the transition, but Beggins and CBRE
could not agree on some retention-agreement provisions.
Beggins ended his work for CBRE, but it did not pay Beggins
the retention bonus. Beggins tried to apply for benefits
under CBRE's severance pay policy, but CBRE did not
respond to Beggins's benefits claim. Beggins sued,
asserting claims for breach of contract, promissory estoppel,
negligent misrepresentation, and wrongful denial of ERISA
benefits. (Docket Entry No. 11). After discovery, CBRE moved
for summary judgment on all four claims, and Beggins
responded, agreeing to dismiss the promissory estoppel and
breach of contract claims. (Docket Entry Nos. 19 ¶ 3; 20
¶ 1). CBRE replied. (Docket Entry No. 20). The court
granted leave for CBRE to amend its answer and both parties
submitted supplemental briefing to CBRE's motion for
summary judgment and Beggins's response. (Docket Entry
Nos. 24, 25, 26).
on the motion, response, reply, the supplemental briefs, the
record, and the applicable law, CBRE's motion for summary
judgment, (Docket Entry No. 16), is granted in part and
denied in part. The reasons for this ruling are explained
below. A scheduling and status conference is set for
Friday, July 13 at 3:00p.m.
led GEMSA Loan Services as its seconded chief executive
officer for over a decade. (Docket Entry No. 16 ¶ 19).
GEMSA was a partnership between a CBRE subsidiary and a
General Electric Corporation subsidiary. (Id.). Du
ring this time, Beggins was considered a CBRE employe e, paid
by CBRE. (Docket Entry No. 19, Ex. A, Joseph Beggins Dep. 33:
April 2015, General Electric decided to leave the GEMSA
partnership, requiring a reduction in the number of employees
and the partnership's dissolution. (Docket Entry No. 16
¶ 20). CBRE planned to end Beggins's employment, but
General Electric wanted Beggins to stay and protect its
interests in the transition period. (Docket Entry No. 19, Ex.
B, Chris Shamaly Dep. 51: 4-13). CBRE offered Beggins a
retention agreement as an incentive to help with the
transition through the end of the year. (Docket Entry No. 16
2015, General Electric's global head of asset management,
Joe Manasseri, called Beggins to tell him that he would soon
receive a formal retention agreement calling for an $800, 000
payment. (Docket Entry No. 19, Ex. A, Joseph Beggins Dep.
120: 15-121: 12). One month later, Beggins received a phone
call from a GEMSA board member, Neil Sullivan, to discuss the
agreement. Sullivan told Beggins that the amount would be
closer to $827, 000. (Id. 113: 1-25). General
Electric decided to structure the agreement to pay $200, 000
for Beggins's continued employment through the year's
end and to pay $627, 000 in place of the amount Beggins would
have received under CBRE's severance policy.
(Id., Ex. B, Chris Shamaly Dep. 46: 1-20).
22, 2015, another GEMSA board member, Jeff Majewski, sent
Beggins a copy of the retention agreement and a release form.
(Id. ¶ 12). The retention agreement provided in
1. Background: You are currently employed by
CBRE and seconded to GEMSA Loan Services . . . as that
company's Chief Executive Officer. . . . The [General
Electric] Partner has informed the CBRE Partner that it
intends to . . . withdraw as a partner of GEMSA on or about
August 31, 2015 . . . .
2. Retention Period: CBRE desires that you
continue employment with CBRE at your current salary through
the earlier to occur of either (a) the last day of the month
in which the IT Migration Occurs, or (b) December 31, 2015 .
. . .
. . .
5. Payments: In lieu of any bonus
consideration that you may have been eligible for under GEMSA
or CBRE bonus plan and CBRE's Severance Policy, CBRE
agrees to pay you a “Retention Bonus” equal to
$827, 202 . . . within twenty (20) days following the
completion of working through the Retention Period . . .
6. Breach: If you do not either (a) return a
fully executed copy of this Agreement by email by the date
set forth below, or (b) meet the Retention Period obligations
. . . CBRE may terminate your employment effective August 31,
2015 and you will not be eligible for the Retention Bonus . .
. but instead will receive severance equal to $471, 868 . . .
. . .
10. Employee Release of Claims: As a
condition of receiving the Retention Bonus and/or severance,
employee agrees to execute CBRE's General Release and
Agreement at the end of employee's employment. . . .
(Docket Entry No. 16, Ex. A at 7-8). The CBRE General Release
Employee does hereby, and for Employee's heirs, legal
representatives, agents, successors in interest, and assigns,
irrevocably and unconditionally release, acquit, and forever
discharge CBRE and all of its Agents . . . of and from all
claims, actions, causes of action, rights, demands, debts,
obligations, damages, or accounts of whatever nature arising
through the date hereof . . . which Employee has against
[CBRE and all of its Agents] by reason of or arising out of
Employee's employment with CBRE or any other matters of
whatever nature, whether known or unknown . . . .
(Id., Ex. B ¶ 7(A)).
consulted with his attorney and sent proposed changes to the
retention agreement and release form two weeks later.
(Id., Ex. F). In one of the many revisions, Beggins
proposed to change the language releasing “CBRE and all
of its Agents” in the CBRE General Release to just
“CBRE Capital Markets.” (Docket Entry No. 16, Ex.
F at 79). Beggins wanted to preserve any claims he might have
against General Electric for his pension benefits. (Docket
Entry No. 19, Ex. A, Joseph Beggins Dep. 153: 1-13).
sent the edits to Majewski, who forwarded the changes to
Chris Shamaly in CBRE's general counsel office. (Docket
Entry No. 19, Ex. D at 3). Shamaly told Majewski that the
changes to the release were “probably not
acceptable” by CBRE's human resources office, but
that he would “send it to them for review.”
(Id.). Shamaly forwarded the changes to
Nadine Chang, assistant general counsel for CBRE, stating:
“Have you had a chance to look at this? . . . If none
of his lawyer's changes are acceptable, that's okay.
At a minimum, I assume the changes to the [release agreement]
are not all acceptable.” (Id. at 4). Chang
responded, “His changes are ridiculous. We should
days later, Majewski sent back a new agreement incorporating
and rejecting some of Beggins's proposals. (Docket Entry
No. 16, Ex. G). CBRE rejected Beggins's proposal to
change “CBRE and all of its Agents” to limit the
release to “CBRE Capital Markets.”
same day, Beggins spoke by phone with Majewski and Shamaly to
discuss the release and explain that he did not want to
release General Electric. (Docket Entry No. 19, Ex. A, Joseph
Beggins Dep. 166: 12-19; Ex. B, Chris Shamaly Dep. 13: 2-18).
Beggins asked Majewski and Shamaly what the word
“agents” meant in the general release. They told
him they did not know. (Id., Ex. A, Joseph Beggins
Dep. 166: 7-19). Majewski and Shamaly told Beggins that he
could send back another edited agreement that expressly
excluded General Electric from the release provision, instead
of changing “CBRE and all of its Agents” to
“CBRE Capital Markets.” (Id. 168: 3-11,
week later, Beggins sent another proposed agreement to
Majewski. (Docket Entry No. 16, Ex. H). In the revised
release form, instead of changing the “CBRE and all its
Agents” language, Beggins added the following line:
It is acknowledged that [CBRE and all of its Agents] does not
include the General Electric Company, General Electric
Capital Corporation or any of its respective subsidiaries,
affiliates, divisions, predecessors, successors, officers,
directors, shareholders, employees, representatives or
(Id. at 109). Beggins did not get a response. On
September 1, 2015, he emailed Sullivan, Majewski, Shamaly,
and Chang to ask whether CBRE had decided to accept or reject
his most recent proposed agreement. (Id., Ex. I at
124). Chang responded that CBRE was in the process of
revising the documents. (Id.). Beggins contacted
Chang again on September 10 for an update and did not receive
a response. (Id. at 123). On September 16, Beggins
contacted Chang for a third time and Chang responded:
Apologies for the delay. We will be updating the retention
and general release agreement that you marked up and returned
to us. We will not accept the change that you made that
indicates that [General Electric] Corporation and [General
Electric] Capital are excluded from the arbitration agreement
or release, however, I believe we are close to agreement on
the other changes that you made.
(Id. at 122). Beggins responded: “Thank you
Nadine, that is all I needed to know. Much
appreciated.” (Id.). Beggins testified that he
understood this interaction to mean he would receive the
standard CBRE retention agreement and release with the
previous “CBRE and all of its Agents” language.
(Docket Entry No. 19, Ex. A, Joseph Beggins ...