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Chapman v. Asbury Automotive Group, Inc.

United States District Court, E.D. Virginia, Richmond Division

September 7, 2016



         This matter comes before the Court on Defendant Asbury Automotive Group, Inc.'s ("Asbury") Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), [1] (ECF No. 3), and Asbury's Amended Memorandum in Support, (ECF No. 6). Plaintiff Joseph D. Chapman ("Chapman") responded, (ECF No. 10), and Asbury replied (ECF No. 11). This matter is ripe for disposition. The Court dispenses with oral argument because the materials before it adequately present the facts and legal contentions, and argument would not aid the decisional process. The Court exercises jurisdiction pursuant to 28 U.S.C. § 1332.[2] For the reasons that follow, the Court will grant Asbury's Motion to Dismiss. (ECF No. 3.)

         I. Standard of Review

         "A motion to dismiss under Rule 12(b)(6) tests the sufficiency of a complaint; importantly, it does not resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses." Republican Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir. 1992) (citing 5 A Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1356 (1990)). In considering a motion to dismiss for failure to state a claim, a plaintiffs well-pleaded allegations are taken as true and the complaint is viewed in the light most favorable to the plaintiff. Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993); see also Martin, 980 F.2d at 952.

         The Federal Rules of Civil Procedure "require[] only 'a short and plain statement of the claim showing that the pleader is entitled to relief, ' in order to 'give the defendant fair notice of what the ... claim is and the grounds upon which it rests.'" Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (omission in original) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). Plaintiffs cannot satisfy this standard with complaints containing only "labels and conclusions" or a "formulaic recitation of the elements of a cause of action." Id. (citations omitted); see also Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). Instead, a plaintiff must assert facts that rise above speculation and conceivability to those stating a claim that is "plausible on its face." Twombly, 550 U.S. at 570. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). Therefore, in order for a claim or complaint to survive dismissal for failure to state a claim, the plaintiff must "allege facts sufficient to state all the elements of [his or] her claim." Bass v. E.I. DuPont de Nemours & Co., 324 F.3d 761, 765 (4th Cir. 2003) (citations omitted).

         "If, on a motion under Rule 12(b)(6)..., matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56, " and "[a]ll parties must be given a reasonable opportunity to present all the material that is pertinent to the motion." Fed.R.Civ.P. 12(d); see Laughlin v. Metro. Wash. Airports Auth., 149 F.3d 253, 260-61 (4th Cir. 1998); Gay v. Wall, 761 F.2d 175, 177 (4th Cir. 1985). However, "a court may consider official public records, documents central to plaintiffs claim, and documents sufficiently referred to in the complaint [without converting a Rule 12(b)(6) motion into one for summary judgment] so long as the authenticity of these documents is not disputed." Witthohn v. Fed. Ins. Co., 164 F.App'x 395, 396-97 (4th Cir. 2006) (citing Alt. Energy, Inc. v. St. Paul Fire & Marine Ins. Co., 267 F.3d 30, 33 (1st Cir. 2001); Phillips v. LCI Int'l, Inc., 190 F.3d 609, 618 (4th Cir. 1999); Gasner v. Cty. of Dinwiddie, 162 F.R.D. 280, 282 (E.D. Va. 1995)).

         Chapman attached the following to his Complaint: (1) an "Asbury Automotive Group, Inc. Amended and Restated 2002 Equity Incentive Plan Restricted Share Award Agreement for GM Equity Incentive Program (Cliff Vesting)" (the "Award Agreement"), (Compl. Ex. 1, ECF No. 1-4); and, (2) a Common Stock Certificate of Asbury Automotive Group, Inc., (Compl. Ex. 2, ECF No. 1-5). This Court will consider the exhibits because the documents are central to the claims, are sufficiently referred to in the Complaint, and neither party contests their authenticity.[3] See Witthohn, F.App'x at 396-97 (citations omitted).

         II. Factual and Procedural Background

         A. Summary of Allegations in the Complaint[4]

         Asbury owns the Crown Platform, one of its several companies that operate car dealerships. Chapman commenced employment with Asbury as an automobile sales associate in the Crown Platform in October 1999. Over the next six years, Asbury promoted Chapman several times. In 2005, he became the General Manager of Crown Richmond BMW in Midlothian, Virginia.

         At a company-wide recognition dinner in March 2011, Asbury honored Chapman and seven other general managers for top performance based on customer satisfaction, vehicle sales, and dealership profitability. Asbury also awarded Chapman 4, 000 restricted shares of Asbury stock (the "Restricted Shares"). The Award Agreement governed the stock share award and placed restrictions on the shares, including limitations on transfer, risks of forfeiture, and vesting of Chapman's rights to the shares. Section 3(a) of the Award Agreement states, in pertinent part:

The Grantee's rights with respect to the Restricted Shares shall become fully vested, and the restrictions set forth in this Award Agreement shall lapse, on the third anniversary of the Grant Date (the "Vesting Date"); provided that the Grantee must be employed as of such Vesting Date, except as otherwise determined by the Committee in its sole discretion.
The Committee, in its sole discretion, may accelerate the vesting of all or any portion of the Restricted Shares, at any time and from time to time.

(Award Agreement 2.) Section 4 of the Award Agreement states, in pertinent part: "[I]f the Grantee's rights with respect to any Restricted Shares ... awarded to the Grantee pursuant to this Award Agreement have not become vested prior to the date on which the Grantee's employment is terminated, the Grantee's rights with respect to such Restricted Shares ... shall immediately terminate" (Id. at 2.) The Grant Date of Chapman's award was April 19, 2011, making the Vesting Date April 19, 2014.

         Asbury Regional Manager Jeffrey Hicks ("Hicks") terminated Chapman's employment on December 2, 2013, four months prior to the Award Agreement's Vesting Date. Hicks had attended the March 2011 recognition dinner and knew that Chapman's shares would not vest for three years after the Grant Date. Chapman contends that, although his "sales were up" and commensurate with sales at other Asbury dealerships in the market, Hicks set "unrealistically high" sales targets for Chapman's dealership and gave "false information" that Chapman was performing "poorly." (Compl. ¶¶ 17, 23.) Chapman also asserts that Asbury had a custom and practice of not terminating employees in December.

         Upon termination, Chapman requested that he "remain employed by Asbury in some capacity" because, in his experience with Asbury, managers were not terminated when another position with the company was available. (Id. ¶ 18.) Chapman also informed Hicks that he needed to remain employed with Asbury until April 19, 2014, the Vesting Date, in order to receive his 4, 000 shares of Asbury stock. Hicks denied Chapman's request, and, as a result of the termination of his employment, Chapman did not receive the Restricted Shares under the Award Agreement.

         B. Proce ...

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