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Tyson v. BB & T Corporation

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

February 21, 2017

WILLIAM L. TYSON, Plaintiff,


          Robert E. Payne Senior United States District Judge

         This matter is before the Court on BB&T CORPORATION'S MOTION TO DISMISS (ECF No. 7) . For the reasons set forth below, the motion will be denied.


         In the Complaint (ECF No. 1), William L. Tyson ("Tyson") alleges a breach of contract in connection with two restricted stock award agreements ("RSAs") made between Tyson and the Defendant, BB&T Corporation ("BB&T"). (Compl. ¶ 1). The Complaint seeks damages, declaratory, and injunctive relief based on three separate but alternatively pled claims. (Compl. ¶¶ 1, 27, 34). BB&T CORPORATION'S MOTION TO DISMISS ("Def. Mot.") challenges the legal sufficiency of Counts II and III of the Complaint, and requests dismissal of both. (Def. Mot. 1-2) . In evaluating the Defendant's Motion, the Court accepts as true all well-pleaded allegations in the Complaint, and views the facts in the light most favorable to Tyson. Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993).

         A. Relevant Facts

         As alleged in the Complaint, Tyson was employed by BB&T Securities, a wholly-owned subsidiary of BB&T, as a Senior Manager of Capital Markets from 1997 until 2016. (Compl. ¶ 5). Towards the end of his employement, Tyson and BB&T entered into two "substantially identical" RSAs.[1] (Compl. ¶ 6). The first RSA was dated February 24, 2014, and awarded Tyson 981 shares of BB&T common stock; the second RSA was dated February 24, 2015, and awarded Tyson 3, 188 shares of BB&T common stock. Id. The first RSA provided that the stock award would vest in three equal portions on February 24 of 2015, 2016, and 2017; the second RSA provided that its award would vest in three equal portions on February 24 of 2016, 2017, and 2018. Id.

         The RSAs purportedly provided that, if Tyson were to quit or resign from his position, the stock awards would continue to vest pursuant to their original vesting schedule unless Tyson gained new employment with a "competitor of BB&T or any of its Affiliates." (Compl. ¶ 8) . The determination of whether any of Tyson's subsequent employers constituted a "competitor" was to be made in the sole and unreviewable discretion of the "Plan Administrator, " defined as the BB&T Board of Directors, or, if so designated, the Board's Compensation Committee. (Compl. ¶ 9). In the event that Tyson's termination was "involuntary and without cause, " the RSAs provided that the stock awards would fully and immediately vest. (Compl. ¶ 7). Tyson alleges his employment was twice terminated in February Of 2016 "involuntarily and without cause." Id.

         Tyson alleges that he received notice of termination without cause on or about December 20, 2015. (Compl. ¶ 10). He further alleges that he entered into a separation agreement with BB&T Securities that was fully executed by all parties on January 25, 2016. That agreement provided that Tyson's employment would effectively terminate no later than February 5, 2016. (Compl. ¶ 10) . In the agreement and in exchange for a lump-sum severance payment, Tyson agreed to, among other things, a "release of all claims related to his employment with BB&T Securities and the termination of that employment." Id. Nevertheless, Tyson alleges that, at the time of his termination, he was "assured" by BB&T Securities that his RSAs would be vested in full without any restrictions. (Compl. ¶ 11). At that time, he had received only the first one-third portion of the stock award set out in the first RSA. Id.

         On or about February 16, 2016 (eleven days after the initially provided "effective termination" date), BB&T presented Tyson with an amended separation agreement, which extended his employment to February 29, 2016. (Compl. ¶ 12) . Then, on March 1, 2016, Tyson received an offer of employment by BB&T Scott & Stringfellow, a different division within BB&T Securities. (Compl. ¶ 13) . As a condition of accepting the offer, Tyson signed another document that purported to void the previous separation agreement, as amended, in its entirety. Id. Nevertheless, Tyson received the severance called for under the purportedly voided agreement. Id.

         Sometime after his employment began with BB&T Scott and Stringfellow, Tyson became aware that "BB&T had reneged on its promise to fully vest his shares upon his involuntary termination, " and had instead vested only the portions due under the RSAs as if he had remained continuously employed by BB&T. (Compl. ¶ 14) . Effective May 1, 2016, Tyson resigned from his employment, and took a new position with Fifth Third Bank as a Senior Managing Director. (Compl. ¶ 15).

         Although Tyson alleges that Fifth Third Bank "does not compete with BB&T Scott & Stringfellow, " BB&T Securities notified Tyson that he had forfeited the outstanding portions of the stock awards by joining a competitor of BB&T Securities. (Compl. ¶ 16-17) . Tyson alleges that the determination that Fifth Third Bank was a competitor was made by someone other than the Board of Directors or Compensation Committee. Id. He also alleges that, at the time of his original involuntary termination, the unvested shares promised in the RSAs were worth in excess of $120, 000.00. (Compl. ¶ 19). In terms of current market prices, Tyson states that the value of the wrongfully forfeited stock still exceeds $90, 000.00. Id.

         B. Procedural Posture

         Based on the facts alleged in the Complaint, Tyson asserts three alternative claims for relief. Count I seeks in excess of $100, 000 for breach of contract on the theory that BB&T was required to fully vest both RSAs when Tyson was effectively terminated on February 5, 2016, and that BB&T's obligation was unaffected by the severance agreements. (Compl. ¶ 23). Count II seeks the same award, on the alternative theory that BB&T breached the RSAs when it wrongfully declared the forfeiture of the outstanding stock awards in response to Tyson's employment with Fifth Third Bank. (Compl. ¶¶ 30-33). Finally, and in the alternative to Counts I and II, Count III seeks both declaratory and injunctive relief. (Compl. ¶¶ 34-43). Specifically, it seeks an order that the provisions of the RSAs restricting employment are overbroad and unenforceable as against public policy, and, as an alternative to an award of money damages, an order granting specific performance of the RSAs-i.e, an order granting Tyson 2, 453 shares of unrestricted BB&T common stock. Id.

         In response to these allegations, BB&T CORPORATION'S MOTION TO DISMISS (ECF No. 7) ("Def. Mot.") seeks dismissal of Counts II and III under Fed.R.Civ.P. 12(b)(6). Id. at 1. In its supporting memoranda (ECF No. 8) (wDef. Memo"), BB&T argues that Tyson has failed to demonstrate an entitlement to the $100, 000 in damages alleged in Count II, and otherwise failed to satisfy the elements required of declaratory judgment actions under Count III. Id. at 6-9, 9-11. Tyson has filed a MEMORANDUM IN OPPOSITION TO DEFENDANT'S PARTIAL MOTION TO ...

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