United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 01-3505
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Donald G. Cousineau, *
*
Appellee, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota.
Norstan, Inc., *
*
Appellant. *
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Submitted: October 9, 2002
Filed: March 6, 2003
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Before McMILLIAN, LAY, and RILEY, Circuit Judges.
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RILEY, Circuit Judge.
Norstan, Inc. (Norstan) appeals the district court’s1 grant of summary judgment
in favor of Donald G. Cousineau (Cousineau). Cousineau sought damages from
Norstan relating to a dispute over sales commissions. Norstan contractually agreed
to pay Cousineau twenty-five percent of the gross margin on all “guaranteed revenue”
from the equipment and service outsourcing contracts Cousineau negotiated for
Norstan. Norstan argues two of the three sales contracts Cousineau negotiated had
1
The Honorable David S. Doty, United States District Judge for the District of
Minnesota.
lower “guaranteed revenue” than asserted by Cousineau, thereby reducing the
commissions owed to Cousineau. We disagree and affirm.
I. BACKGROUND
Norstan provides telecommunication equipment and consulting and
management services. Cousineau marketed outsourcing contracts for Norstan’s
services. In 1997, Cousineau transferred from Norstan’s Montreal, Quebec, office to
its Plymouth, Minnesota office. Cousineau’s title became Director of Strategic
Alliances; however, he continued to focus exclusively on selling outsourcing
contracts. At that time, the parties negotiated a new contract (Letter Agreement)
dated July 25, 1997, providing that Cousineau would receive twenty-five percent of
the gross margin on all “guaranteed revenue” for the initial term of the outsourcing
contracts he negotiated for Norstan. The Letter Agreement further provides that any
changes made to the outsourcing contracts within ninety days of execution are
included in the final commission calculation.
Cousineau negotiated three outsourcing contracts before leaving Norstan.
Cousineau alleged Norstan breached the Letter Agreement by failing to pay him all
the commissions owed on two of the contracts: (1) the Grandview contract, and (2)
the AmerUs contract. Cousineau filed claims for breach of contract, unjust
enrichment, and failure to pay wages promptly in violation of Minn. Stat. § 181.14
(1998). Norstan counterclaimed, contending Cousineau was overpaid and had
misrepresented the commissions and information to both Grandview and AmerUs.
Specifically, Norstan alleged fraud, fraudulent concealment, negligent
misrepresentation, breach of fiduciary duty, unjust enrichment, and breach of
contract.
The district court granted Cousineau summary judgment on his breach of
contract and section 181.14 claims, while dismissing Cousineau’s unjust enrichment
claim and Norstan’s counterclaims. The district court awarded Cousineau
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$699,817.85, which included unpaid commissions, prejudgment interest, penalties,
attorney fees and costs.
On appeal, Norstan contends the district court erred in granting Cousineau
summary judgment because (1) a modification to the Grandview contract reduced the
amount of commissions owed, and (2) the AmerUs contract did not contain a required
minimum number of long distance minutes, which reduced the commissions sought
by Cousineau. Norstan also argues the district court erred in dismissing Norstan’s
counterclaims and in awarding Cousineau prejudgment interest, penalties, attorney
fees and costs.
II. DISCUSSION
We review the grant or denial of summary judgment de novo. See Calder v.
TCI Cablevision of Mo., Inc., 298 F.3d 723, 728 (8th Cir. 2002). “Summary
judgment is proper where the evidence, when viewed in the light most favorable to
the nonmoving party, indicates that no genuine issue of material fact exists and that
the moving party is entitled to judgment as a matter of law.” Id.; Fed. R. Civ. P.
56(c).
A. Grandview Contract
Over the course of several months, Cousineau negotiated a contract with
Grandview for telecommunication services and equipment. The primary contact
person from Grandview with whom he negotiated was Martina Clemens (Clemens).
Clemens was a vice president at Grandview, the sister-in-law of Grandview’s
president and CEO, and responsible for Grandview’s contract negotiations with
Norstan. At the conclusion of the negotiations, the contract contained a “termination
for convenience” clause, whereby Grandview could terminate the contract at the end
of two years, without cause, by giving six months notice. In that event, Grandview
would be subject to a specified amount of “stranded costs.” Otherwise, the contract
contemplated a service agreement for six years.
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After executing the contract on June 11, 1998, Cousineau submitted his
commission request based on a calculation of the revenue for the full six years of the
contract. However, Norstan determined the “guaranteed revenue” based on only two
years because of the termination clause. Cousineau then sought and received
permission from Norstan to negotiate with Grandview to eliminate the termination
clause from the contract. Cousineau talked to Clemens, and Clemens agreed to
eliminate the termination clause. On August 13, 1998, Clemens initialed a single
redlined page from the contract, which contained the deleted termination clause. On
August 25, 1998, Jim Guthrie, Cousineau’s supervisor, also initialed the redlined
page, after speaking to Clemens, who confirmed she intended to delete the
termination clause in exchange for other contract provisions. Norstan suggests
Cousineau and Clemens actually negotiated some additional changes at the same
time, which never took effect and were not part of the written redlined page. In mid-
September 1998, Norstan understood Grandview did not want the two-year
termination for convenience clause in the contract. However, by September 24, 1998,
Grandview sought to reinstate the termination clause, and Norstan decided that it was
“in the best interests of both parties that the clause for convenience be kept in the
contract.”
Did the August actions constitute an effective modification of the contract for
purposes of calculating Cousineau’s commissions, as a matter of law? Cousineau
argues the redlined page of the contract is unambiguous and the changes speak for
themselves; therefore, no extrinsic evidence need be considered. Norstan contends
the modification was ineffective because it violated the contract’s modification
procedure. Cousineau argues an executive from each company responsible for
negotiating the contract initialed and dated the appropriate portion of the redlined
page, thereby effecting a binding modification. Cousineau further replies that the
modification procedure was not utilized, in this instance, because that procedure
required use of a committee, which had not yet been formed, and later modifications
were made without using a committee.
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“We review the district court’s interpretation of the contract and the grant of
summary judgment de novo.