Mcgurn, v. Bell Microproducts, Inc.

284 F.3d 86 (1st Cir. 2002)

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Nature of the Case

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Facts

D is a distributor of semiconductor parts and components with headquarters in San Jose, California. P is a resident of Massachusetts. In March of 1997, D met with P to discuss the position of Vice President for the Eastern Region. P said that if he came to work for D, he would require a written contract that included a 'termination clause' stipulating that he would receive six months salary and half his commissions in the event that he was fired. An offer letter was prepared and mailed it to P. The termination clause was missing and P and D discussed the issue. According to P, D replied that a twenty-four-month termination clause would be acceptable. A second offer letter was drafted and yet a third. On the third and last one, it stated that: The Company may terminate your employment without cause. In the event that this occurs within your first twelve months of employment, you will continue to receive your base salary for a period of six (6) months following your termination of employment, [and] . . . you will receive an additional lump-sum amount equal to $ 40,000 or 50% of annual incentive. P signed his name but crossed out the word 'twelve' in the termination clause, inserted 'twenty-four' directly above it, and initialed the change. The alteration was in the center of the second page of the two-page letter, five inches above McGurn's signature. P returned the letter and started work on July 8, 1997. P advised no one at D that he had modified the July 3 offer letter. Everyone involved on D's side denies having viewed the letter upon its return. There was evidence that it was D's practice to check that returned offer letters had been signed by the employee. In or around April of 1998, it was concluded that P's performance was not satisfactory. D then discovered P's alteration of the offer letter, and it discussed at length in D. P was terminated and refused to pay the amounts specified in the termination clause. P sued D for breach of contract and bother parties filed cross-motions for summary judgment. The district court found that P's alteration constituted a counteroffer which, in the circumstances of this case, D had accepted by its silence. The district court concluded that D should have known about the change made by P, and hence its silence constituted an acceptance of P's counteroffer. The court entered judgment for P in the amount of $ 120,000 plus interest. D appealed.