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McCabe v. Abbott Labs., Inc.

United States District Court, E.D. North Carolina, Western Division

September 19, 2014

JILL C. MCCABE, Plaintiff,

For Jill C. McCabe, Plaintiff: G. Christopher Olson, H. Forest Horne, Jr., LEAD ATTORNEYS, Martin & Jones, Raleigh, NC.

For Abbott Laboratories, Inc., Defendant: Zebulon D. Anderson, LEAD ATTORNEY, Smith Anderson Blount Dorsett Mitchell & Jernigan, LLP, Raleigh, NC.

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JANIES C. DEVER III, Chief United States District Judge.

On February 20, 2013, Jill C. McCabe (" McCabe" or " plaintiff" ) sued her former

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employer Abbott Laboratories, Inc. (" Abbott" or " defendant" ) and makes three claims concerning her 2011 and 2012 incentive compensation: (1) breach of contract; (2) a violation of the North Carolina Wage and Hour Act (" NCWHA" ),N.C. Gen. Stat. § § 95-25.1-95-25.25; and (3) unjust enrichment. See Compl. [D.E. 2]. On February 14, 2014, Abbott moved for summary judgment [D.E. 25]. On March 14, 2014, McCabe responded in opposition [D.E. 30]. On March 31, 2014, Abbott replied [D.E. 43]. As explained below, the court grants Abbott's motion for summary judgment.


McCabe was an Abbott pharmaceutical sales representative in Raleigh, North Carolina. See McCabe Dep. [D.E. 27-1 ] 22-26. McCabe worked for Abbott from October 2003 until she resigned in May 2012. Id. 20; Oudal Dep. [D.E. 44-1] 8. Beginning in 2010, Yolanda Lindsay was McCabe's supervisor and district manager. McCabe Dep. 21; Lindsay Dep. [D.E. 27-2] 7,23-24. McCabe's regional manager was Christine Mueller. McCabe Dep. 47. Mueller's supervisor was Medgar Williams, the national sales director. Id.

McCabe was responsible for selling Humira, an Abbott drug, in eastern North Carolina. Id. 22-26. From 2010 to 2012, McCabe worked with another Abbott sales representative, Joy Gordon, to sell Humira. See id. 25-28. In 2011 and 2012, Abbott compensated McCabe with a base salary of approximately $110,000 and the possibility of quarterly incentive bonuses. See id. 34, 37, 61, 122-23; McCabe Dep. Exs. 7,22; Brooks Decl. [D.E. 28] ¶ ¶ 7-8, Exs. A--B; Lindsay Dep. 48-49, 52.

In 2011 and 2012, Abbott's sales representatives were eligible for quarterly incentive payments pursuant to Abbott's Sales Incentive Eligibility and Program Criteria documents. See McCabe Dep. 31-32,175; McCabe Dep. Exs. 6, 37; Brooks Deck ¶ 7, Exs. A--B. Under Abbott's Sales Incentive Eligibility and Program Criteria documents (" criteria documents" ):

All payouts or awards discussed herein are discretionary. Any amounts, percentages, or particular awards discussed are presented as guides, not as guarantees. Abbott reserves the right in its sole and absolute discretion whether any payout, payout amount, or award is issued under any program.

Brooks Deck f7, Ex. A (section 1 with heading " Introduction" ). Abbott's criteria documents also discussed " data anomalies" and stated:

There are no minimum or maximum payout or award limits for Sales Bonuses, unless otherwise noted in your specific sales force bonus plan. However, unanticipated data anomalies or business developments may arise that may affect payout amounts. The amount or method of calculation of any Sales Bonus is discretionary, along with the decision as to whether any payout or award should be issued.

Id. (section 3 with heading " Payout Limit or Modifications" ). Abbott's criteria documents also addressed employment eligibility requirements concerning incentive-compensation payments. Specifically, Abbott's criteria documents stated: " Except as specifically provided in these guidelines, an employee who is not actively employed, or on active payroll on the payout date for any reason, as determined by [Abbott], is not eligible for and will not have earned a Sales Bonus." Id. (section 3 with heading " Eligibility Requirements -- General" ).

Abbott sales representatives had targets, or quotas. See McCabe Dep. Ex. 7; Oudal Dep. 19, 21; Lindsay Dep. 257-58; Brooks Decl. ¶ 8, Ex. C. The bonus calculation initially depended on whether a sales

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representative met the quota for her territory. See McCabe Dep. Ex. 7; Oudal Dep. 19,21; Brooks Decl. ¶ ¶ 7-8, Exs. A-C. In 2011 and 2012, if a sales representative did not attain 91% of the her quota, she was not eligible for a quarterly bonus. See McCabe Dep. Ex. 7; Brooks Decl. 18, Ex. C (AMcCabe 000558); Oudal Dep. 19,21.

In 2011 and 2012, Abbott based the sales representatives' quotas on individual territory and national historical product sales. See McCabe Dep. Ex. 7; Brooks Decl. ¶ 8, Ex. C. For Humira prescriptions, Abbott received the sales data that it used to calculate quarterly incentive payments primarily from a third-party vendor, IMS. See McCabe Dep. 50,124-25; Brooks Dep. [D.E. 44-2] 13-17. Some pharmacies, however, did not provide their sales data to IMS. If a so-called non-reporting pharmacy had over $1.5 million in annual Humira sales, Abbott obtained the prescription data directly from that pharmacy. See Brooks Dep. 15-16,39. If Abbott did not collect sales data directly from a non-reporting pharmacy, Abbott did not include such sales in a quarterly bonus calculation. See id. 29-31. McCabe knew that she sometimes called on non-reporting pharmacies and might not receive sales credit for sales from such pharmacies. See McCabe Dep. 133-37.

In May 2011, IMS announced a national data issue that affected the pharmaceutical industry. See McCabe Dep. 166-67; McCabe Dep. Ex. 27. Specifically, IMS announced that a major pharmacy had stopped reporting its prescription sales data to IMS pending a contract renegotiation. See Brooks Dep. 123-24. Thus, IMS estimated the missing data for the first quarter (" Q1" ) of 2011. See id.; McCabe Dep. Ex. 27. IMS gave Abbott the option of getting the retrospective corrected data once the contract was renegotiated. See Brooks Dep. 123-25; McCabe Dep. Ex. 27. In order not to delay bonus payments for Q1 2011, which were scheduled for June 9, 2011, Abbott decided to pay the quarterly bonus provisionally, at 70% based on the estimated data, and then to recalculate the bonus with the corrected data. See McCabe Dep. Ex. 27. Abbott told the sales representatives (including McCabe) that any overpayment based on inaccurate estimated data would be carried forward and deducted from future bonus payments. See McCabe Dep. 166-67; McCabe Dep. Ex. 27. In June 2011, Abbott used the estimated data and paid McCabe $4,997.61 for the Q1 2011 bonus. See McCabe Dep. 171; McCabe Dep. Exs. 30-31.

When Abbott received the corrected data from IMS in July 2011, Abbott determined that McCabe had not met 91 % of her quota; therefore, McCabe was ineligible for a Q1 2011 bonus. See McCabe Dep. 78-79,171; McCabe Dep. Exs. 7,27,30. As such, McCabe had a negative balance of $4,997.61 for incentive compensation for Q1 2011. McCabe Dep. 165-66. Furthermore, McCabe did not meet 91% of her quota in Q2, Q3, or Q4 of 2011; therefore, she did not receive a bonus in those quarters. See id. 78-79, 166, 171-72; McCabe ...

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