Burnett v. Finance of America Mortgage LLC

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Robert E. Blackburn
Civil Action No. 23-cv-02381-REB-STV
MARK BURNETT,
Plaintiff,
v.
FINANCE OF AMERICA MORTGAGE, LLC, and
GRAHAM FLEMING
Defendant.
ORDER RE: DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT
Blackburn, J.
The matter before me is Defendants’ Motion for Summary Judgment [#40],1
filed October 31, 2024. I grant the motion in part and deny it in part.
I. JURISDICTION
I have jurisdiction over this matter under both 28 U.S.C. § 1332 (diversity of
citizenship).
II. STANDARD OF REVIEW
Summary judgment is proper when there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law. FED. R. CIV. P.
56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d
265 (1986). A dispute is “genuine” if the issue could be resolved in favor of either
1 “[#40]” is an example of the convention I use to identify the docket number assigned to a
specific paper by the court’s case management and electronic case filing system (CM/ECF). I use this
convention throughout this order.
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party. Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574,
586, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986); Farthing v. City of Shawnee, 39
F.3d 1131, 1135 (10th Cir. 1994). A fact is “material” if it might reasonably affect the
outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct.
2505, 2510, 91 L.Ed.2d 202 (1986); Farthing, 39 F.3d at 1134.
A party who does not have the burden of proof at trial must show the absence of
a genuine factual dispute. Concrete Works, Inc. v. City & County of Denver, 36
F.3d 1513, 1517 (10th Cir. 1994), cert. denied, 115 S.Ct. 1315 (1995). Once the
motion has been properly supported, the burden shifts to the nonmovant to show, by
tendering depositions, affidavits, and other competent evidence, that summary
judgment is not proper. Concrete Works, 36 F.3d at 1518. All the evidence must be
viewed in the light most favorable to the party opposing the motion. Simms v.
Oklahoma ex rel. Department of Mental Health and Substance Abuse Services,
165 F.3d 1321, 1326 (10th Cir.), cert. denied, 120 S.Ct. 53 (1999).
III. ANALYSIS
Plaintiff Mark Burnett was employed by defendant Finance of America Mortgage,
LLC (“FOAM”), a forward mortgage lending company, from 2010 until December 15,
2022. From 2017 until the time his employment with FOAM ended, Mr. Burnett was a
branch manager for the company. His branch covered two “cost centers” comprised of
three Colorado offices in the Denver Tech Center/Englewood, Colorado Springs, and
Pueblo.
2
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During the period of time relevant to this lawsuit, Mr. Burnett’s compensation
was paid according to the terms of a Branch Manager Non-Producing Compensation
Agreement.2 (Motion App., Exh. 4.) In addition to specifying the terms of Mr. Burnett’s
base compensation, the agreement set forth the conditions under which Mr. Burnett
would be entitled to various types of variable compensation, including relevantly for
purposes of this lawsuit, bonuses:
Discretionary Bonus. The Company may, from time to time,
award Employee with a Discretionary Bonus based on
Employee’s overall contributions to the Company, or for
greatly exceeding expectations regarding productivity.
Discretionary Bonuses may be awarded for the following
preapproved reasons: 1) exceeding volume expectations, 2)
retention, 3) incentives to join the Company (“Sign-On
Bonus”), and 4) assisting with a corporate initiative. These
bonuses, if any, are awarded at the sole discretion of the
Company, and in amounts set at the sole discretion of
[FOAM].
(Id., Exh. 4 ¶ 5.2 at 3.)
In September 2022, FOAM began discussions with Guaranteed Rate regarding
the sale of FOAM’s assets to Guaranteed Rate, and on September 15, the parties
executed a non-binding term sheet. (Id., Exh. 1 at 11, 22.) The following day, Mr.
Burnett requested a discretionary bonus of $875,000. (See id., Exh. 6.)3 The
requested bonus was more than three times Mr. Burnett’s annual base salary of
$250,000 (id., Exh. 4A) and significantly larger than any bonus he requested in the
2 A “non-producing branch manager” is one who does not originate mortgage loans and thus
does not earn commissions. (Motion App., Exh. 2 at 19.)
3 Although FOAM maintains Mr. Burnett’s bonus request was motivated by rumors of the sale
(see Motion ¶ 23 at 7), he denied as much in his deposition, stating only that rumors of a sale had
circulated on and off for years (see Motion App., Exh. 2 at 47).
3
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past (id., Exh. 2 at 61).4 Nevertheless, Mr. Burnett believed he was entitled to this
bonus based on the status of his general ledger, the success and profitability of his
branches over the years, and his substantial contributions to the success of FOAM,
including taking on business, recruiting, and training for other branches. (See id., Exh.
2 at 61-63; Resp. App., Exh. 15 ¶ 8 at 2, Exh. 17 ¶¶ 4-5 at 1-2.)
Apparently, Mr. Burnett’s supervisors agreed with his assessment, as his bonus
request was marked approved that same day by his direct supervisor, Craig Davis, and
two days later by Michael Farr, FOAM’s president of retail lending and national regional
sales director.5 (See Motion App., Exh. 6; Resp. App., Exh. 15 ¶¶ 3 & 6 at 1.) The
parties dispute whether Mr. Burnett’s request was approved once Mr. Davis and Mr.
Farr executed their approvals. FOAM insists bonus requests were subject to review by
FOAM’s corporate leadership prior to final approval, relying on the deposition testimony
of their Rule 30(b)(6) corporate representative, Michael Lord, FOAM’s Chief Financial
Officer. (Motion App., Exh. 3 at 83-85.)6 By contrast, Mr. Davis, on behalf of Mr.
4 Contrary to FOAM’s suggestion (see Reply Br. at 9), the size of the bonus actually lends
support to Mr. Burnett’s arguments that it constituted “wages” within the meaning of the Colorado Wage
Claim Act. See Rohr v. Ted Neiters Motor Co., 758 P.2d 186, 188 (Colo. App. 1988). Cf. Long v.
OmniTRAX, Inc., 2014 Colo. Dist. LEXIS 3576 at *10 (Colo. Dist. Ct., Denver Cty., March 17, 2014)
(drawing negative inference from fact that bonus was not “disproportionately large” in relation to
employee’s base salary, citing Rohr).
5 These were Mr. Farr’s titles as understood by Mr. Davis, as set forth in his declaration. By
contrast, FOAM has attested that Mr. Farr was “President and Senior Vice President” of FOAM. (Resp.
App., Exh. 21 ¶ 10 at 7.)
6 In FOAM’s description of these steps, the words “process” (Motion ¶ 12 at 5) and “detailed
plan” (see Reply ¶ 52 at 3) are doing a lot of work, at least to the extent they are based on Mr. Lord’s
testimony, which was tentative on this question, at best. (See Motion App., Exh. 3 at 84 (“If it would
have gotten denied by -- for some reason there would have been a communication back to whoever
submitted it, but in most cases I'm sure it would have came from the compensation team[.]”); id., Exh. 3
at 84-85 (“[B]ecause if it was denied, somebody would have had to give the information back to the
branch manager letting him know he's not getting paid. So it would have been, you know, communicated
4
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Burnett, counters that he “understood that Mr. Farr was authorized to sign the form, and
that his signature on the form represented FOAM’s agreement to pay Mr. Burnett the
$875,000 bonus he had requested” and that he told Mr. Burnett his bonus had been
approved. (Resp. App., Exh. 15 ¶ 7 at 1, ¶ 11 at 2.) There is also evidence in the
record before me suggesting FOAM never had failed previously to pay a bonus which
had received the required two approvals. (See id., Exh. 15 ¶ 12 at 3.) Moreover, Mr.
Burnett avers he saw his bonus reflected on FOAM’s CompenSafe system on
September 27, 2022. (Id., Exh. 17 ¶ 11 at 5.) The following day, however, it was gone.
(Id.; see also Motion App., Exh. 8.)
According to the declaration of FOAM’s former Chief Operating Officer on behalf
of Mr. Burnett, prior to September 2022, “FOAM customarily approved discretionary
bonus requests by nonproducing branch managers up to an amount equal to the
amount in the branch manager’s general ledger, less two months of reserves for branch
expenses.” (Resp. App., Exh. 16 ¶ 6 at 1.) Mr. Burnett asserts that at the time he
requested his bonus, his Englewood branch held sufficient funds to pay his requested
bonus and leave enough in reserve to cover fixed costs for almost a year. (Id., Exh. 17
¶¶ 7-8 at 2-3, Exh. 18 at 35-36.) However, during the period of the contemplated sale
to Guaranteed Rate, defendant Graham Fleming, FOAM’s Chief Administrative Officer,
and Mr. Lord adapted the formula to include, in addition to two months’ operating
expenses, deductions for an amount for severance and an amount to cover remaining
somehow from that way and then at that point, you know, if the branch manager got a denial, I'm sure
the first phone call they were going to make was to Mr. Davis or Mr. Farr if that's who they reported
to.”).)
5
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lease obligations. In late September or early October 2022, the reserve requirement
was increased again, to six months’ operating expenses, severance, and remaining
lease obligations, with the expectation that it would take that much time to service the
remaining loans in FOAM’s pipeline after it stopped originating new loans. (Motion
App., Exh. 1 at 24-25, Exh. 3 at 31-32, 40, 86, 88-89.)
Ultimately, however, the Guaranteed Rate acquisition did not go through, which
FOAM perceived as making the need to ensure adequate reserves even more crucial,
as there was no longer the opportunity to transfer those obligations to a buyer. (Id.,
Exh. 1 ¶ 8 at 2.) Soon thereafter, FOAM decided to exit the forward mortgage lending
industry and cease operations entirely. Mr. Fleming announced that decision to FOAM
employees on October 21, 2022. (Id., Exh. 1 ¶ 8 at 1 & Exh. 5.)
Meanwhile, after discovering his bonus was no longer reflected on the
company’s compensation ledgers, Mr. Burnett emailed Jason Kashuba, the sales
compensation manager, carbon copy to Mr. Davis, to inquire on the status of his bonus.
Mr. Davis responded, assuring Mr. Burnett that “as a non producing mgr you will be
fine” and “nothing has come up to the contrary about compliant bonuses.” (Id., Exh. 8.)
On October 7, after Mr. Burnett again inquired about the status of his bonus, Mr.
Kashuba responded that the request was being reviewed. (Id., Exh. 9.) Ultimately,
FOAM denied Mr. Burnett’s request for a bonus on the basis that fulfilling it would have
left his branch’s general ledger with a negative balance and no reserves to cover
expenses. (See id., Exh. 1 ¶¶ 9-20 & Exh. A, Exh. 10.) However, Mr. Burnett insists
the calculation of his branches’ reserves was skewed because FOAM included all 63
6
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months of rent remaining on the recently-renewed lease of the Englewood office7
without considering that the lease gave FOAM the opportunity to terminate early in
November 2025. (Resp. App., Exh. 17 ¶ 19 at 5-6; Exh. 19 at 52-55, 63-65; Exh. 23 ¶
11 at 4-5.)
Mr. Burnett continued to work for FOAM through mid-December 2022, assisting
with the winding down of his branches’ affairs. He states he did so in anticipation of
receiving his bonus, allegedly foregoing the opportunity to begin searching for a new
position earlier. (Id., Exh. 19 ¶ 18 at 5.) His employment terminated December 15,
2022. On March 3, 2023, he inquired of FOAM’s associate general counsel as to the
status of his bonus (Motion App., Exh. 12), but there is no evidence that anyone at
FOAM ever responded to this inquiry. This lawsuit followed.
By this lawsuit, Mr. Burnett contends the failure to pay his bonus violates the
Colorado Wage Claim Act (“CWCA”), §§8-4-101 – 8-4-125, C.R.S. He also alleges
claims for breach of contract and unjust enrichment. FOAM and Mr. Fleming have
moved for summary judgment on all these claims. Initially, Mr. Burnett concedes
7 FOAM attaches to its reply brief an exhibit purporting to show Mr. Burnett approved the lease
renewal in May 2022. (Reply App., Exh. 27.) The exhibit does not prove any such thing, as Mr. Burnett
simply told the leasing agent to “get [the lease] finalized,” and the agent responded with a “clean copy”
and asked Mr. Burnett to contact him with “questions . . . and/or to discuss.” (Id.) The lease was not
signed until August 5, 2022, by Mr. Reich; Mr. Burnett avers he had no authority to sign the lease. (See
Motion App., Exh. 16 ¶ 9 at 2, Exh. 17 ¶¶ 14-15 at 4.)
Moreover, nothing in this putative factual dispute is relevant to the court’s resolution of the issues
raised by and inherent to the motion for summary judgment. Accordingly, the court finds no need to
consider Mr. Burnett’s putative objection to its consideration (see Plf. Partial Obj. [#48], filed December
26, 2024), which essentially constitutes an unauthorized sur-reply in any event. See Green v. New
Mexico, 420 F.3d 1189, 1197 (10th Cir. 2005) (court did not abuse its discretion in denying leave to file a
sur-reply where it did not rely on new materials appended to movant’s reply brief); see also Herlik v.
Knight, 2008 WL 185521 at *4 & n.1 (D. Colo. Jan. 18, 2008) (“There is no provision for filing a
document captioned as a ‘surreply[,]’ [a] term without basis or meaning in the Fed.R.Civ.P.”).
7
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defendants’ argument that Mr. Fleming cannot be individually liable for damages for
breach of contract or unjust enrichment under Colorado law. See Newport Steel Corp.
v. Thompson, 757 F. Supp. 1152, 1156 (D. Colo. 1990).8 Thus, the motion will be
granted as to these claims, and they will be dismissed with prejudice.
The essence of FOAM’s arguments as to all Mr. Burnett’s remaining claims is
that they are untenable because FOAM retained absolute and unbounded discretion to
grant or deny such a bonus. I am unconvinced as a matter of law, and find further that
there are genuine disputes of material fact as to whether FOAM abused its discretion in
denying Mr. Burnett a bonus.
I begin with Mr. Burnett’s CWCA claim. The CWCA was enacted to ensure that
“employers make timely payment of wages and to provide adequate judicial relief when
employers fail to pay wages when due.” Cagle v. Mathers Family Trust, 295 P.3d
460, 469 (Colo. 2013) (citation, internal quotation marks, and ellipses omitted). See
also Brownlee v. Lithia Motors, Inc., 49 F.Supp.3d 875, 878 (D. Colo. 2014). When
an employee is terminated (see Complaint ¶ 5 at 2), his “wages or compensation for
labor or service earned, vested, determinable, and unpaid at the time of such discharge
is due and payable immediately.” §8-4-109(1)(a), C.R.S. “Wages” includes “[b]onuses
8 By contrast, under the CWCA, the term “[e]mployer has the same meaning as set forth in the
federal ‘Fair Labor Standards Act of 1938' 29 U.S.C. sec. 203(d),” §8-4-101(6), C.R.S., pursuant to which
an employer “includes any person acting directly or indirectly in the interest of an employer in relation to
an employee[.]” Under that definition, “personal liability has often been imposed on individual officers in
a corporation without conducting a traditional veil-piercing analysis.” Lopez v. Next Generation
Construction & Environmental, LLC, 2016 WL 6600243 at *3 (D. Colo. Nov. 8, 2016). (The statute
was amended in 2019 to close the “loophole” created by the Colorado Supreme Court’s decision in
Leonard v. McMorris, 63 P.3d 323 (Colo. 2003), which held an individual corporate officer was not a
“person” within the prior meaning of the CWCA, id. at 330. See 2019 COLO. LEGIS. SERV., Ch. 182, (H.B.
19- 1267), §§ 1(b) &(c).)
8
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or commissions earned for labor or services performed in accordance with the terms of
any agreement between an employer and employee.” §8-4-101(14)(a)(II), C.R.S.
As evident from this definition, the CWCA does not create any substantive rights
to any particular form of compensation. Rather it “establishes minimal requirements
concerning when and how agreed compensation must be paid.” Kouzmanoff v. Unum
Life Insurance Co. of America, 374 F.Supp.3d 1076, 1088 (D. Colo. 2019) (citation
and internal quotation marks omitted; emphasis in original).9 Thus, to recover a bonus,
Mr. Burnett must show he has “an enforceable right to receive payment for such
benefits pursuant to an employment agreement.” Johnson v. Greenfield Holdings,
LLC, 2023 WL 3437372 at *3 (D. Colo. May 12, 2023) (citation and internal quotation
marks omitted). See also §8-4-109(2), C.R.S. (“Nothing in [§8-4-109(1), C.R.S.] shall
. . . require the payment at the time employment is severed of compensation not yet
fully earned under the compensation agreement between the employee and employer,
whether written or oral.”).
Courts in this district routinely have considered the CWCA’s requirements that
“wages” be “earned, vested, and determinable” to apply to consideration of the
availability of bonuses. See, e.g., Johnson, 2023 WL 3437372 at *4; Graesser v.
IQVIA RDS Inc., 2022 WL 4547565 at *2 (D. Colo. Sept. 28, 2022). However, in Nieto
v. Clark's Market, Inc., 488 P.3d 1140 (Colo. 2021), the Colorado Supreme Court,
considering a former employee’s claim for vacation pay, remarked that the apposite
9 In so providing, the legislature sought to avoid "employees relying on indefinite, possible
remittances." Kouzmanoff, 374 F.Supp.3d at 1088.
9
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subsection of the CWCA provided only that vacation pay must be “earned” and
“determinable;” it did not require that such pay also be “vested.” See
§8-4-101(14)(a)(III), C.R.S. Because principles of statutory construction require that a
specific provision trump a more general one to the extent they conflict, see id. at 1145
(citing Mook v. Board of County Commissioners of Summit County, 457 P.3d 568,
582 (Colo. 2020)), the Court concluded that a plaintiff seeking vacation pay under the
CWCA need only prove that such benefits were earned, id. at 1145-46.10
Mr. Burnett points out that the subsection of the CWCA concerning the payment
of bonuses likewise requires only that the bonus be “earned,” absolving him of any
burden to prove his bonus was “vested.”11 Given the holding in Nieto, this conclusion
seems inescapable. I thus concur that the clear import of Nieto is to obviate any need
for Mr. Burnett to prove that his bonus was vested.12
The Nieto Court held that a benefit is “earned” when it is owed “as return for . . .
work done or services rendered” by an employee. Nieto, 488 P.3d at 1144. See also
10 In addition, the Nieto Court mused that in the context of the CWCA’s vacation pay provisions,
“it is quite possible that ‘vested’ is essentially a synonym of ‘earned.’” Nieto, 488 P.3d at 1145.
Nevertheless, the court held that “even if vested means something other than earned, its exclusion from
subsection (14)(a)(III) signals that the legislature did not intend it to apply in this context.” Id. at 1146.
11 In addition, because unlike the provision governing vacation pay considered in Nieto, §8-4-
101(14)(a)(III), C.R.S., the subsection providing for bonus does not appear to include even a requirement
that the bonus be “determinable,” see §8-4-101(14)(a)(II), C.R.S., Mr. Burnett argues that, under the
logic of Nieto, he need not prove that element either. I am not entirely prepared to go that far, at least
on the briefing before me. In any event, assuming arguendo Mr. Burnett must show his bonus was
determinable, that he requested and arguably received approval for a bonus of $875,000 certainly would
satisfy that requirement. See Nieto, 488 P.3d at 1144.
12 Indeed, FOAM treats the terms “earned” and “vested” as interchangeable in its motion. (See
Motion at 11 (“A bonus is ‘earned’ and ‘vested’ when an employee performs the work required to receive
the bonus according to the agreement between the employer and employee.”).)
10
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Johnson, 2023 WL 3437372 at *4 (bonus is “earned” when it is “receive[d] as return
for effort and especially for work done or services rendered”) (citation and internal
quotation marks omitted). The terms of the contract provide that bonuses could be
earned based on an employee’s “overall contributions to the Company, or for greatly
exceeding expectations regarding productivity.” (Motion App., Exh. 4 ¶ 5.2 at 3.)
Clearly, such language contemplates the availability of bonuses for “services rendered”
to the company above and beyond those compensated by an employee’s base salary.
At least two supervisors apparently believed Mr. Burnett had rendered such services.
There thus is at least a genuine dispute of material fact as to whether Mr. Burnett had
“earned” a bonus.
FOAM maintains the removal of this requirement is irrelevant here because the
bonuses contemplated by the compensation agreement between the parties were
wholly discretionary. I am not persuaded. FOAM’s reliance on the Denver County
district court decision in Long v. OmniTRAX, Inc., 2014 Colo. Dist. LEXIS 3576 (Colo.
Dist. Ct., Denver Cty., March 17, 2014), is misplaced. The decision there plainly rested
on a determination that the employer’s retention of discretion to award bonuses
prevented the employee’s bonus from being vested. See id. at *4 (noting employer’s
argument that employee’s bonus had not vested), *7 (“[A]n employer is liable when it
refuses to pay vested bonuses . . . or otherwise refuses to recognize the employee’s
vested rights.”), *10-11 (“Where . . . the employer retains absolute discretion to grant or
withhold the bonus, the employee does not have a vested right to the bonus[.]”)
(emphases added). In light of the Colorado Supreme Court’s decision in Nieto, I
11
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cannot find Long persuasive.13 See Panczner v. Fraser, 374 F.Supp.3d 1063, 1068
(D. Colo. 2019) (while decision of a lower state court is not binding on federal court
sitting in diversity, “it should usually be followed ‘unless [the Court] is convinced by
other persuasive data that the highest court of the state would decide otherwise.’”)
(quoting West v. AT & T Co., 311 U.S. 223, 237, 61 S.Ct. 179, 183, 85 L.Ed. 139
(1940)).
FOAM’s only other authority, an appeal of a decision of the Colorado Division of
Labor Standards and Statistics, does not clearly support its position either. See United
States Beef Corp. d/b/a Arby’s, Decision No. 19-060 (July 31, 2019)14 (Motion App.,
Exh. 14.) Instead, the hearing officer in that case found the Division did not clearly err
where the employee’s evidence of oral promises to pay a bonus constituted
uncorroborated hearsay insufficient to overcome the description of the written contract
of the program as discretionary. Id. at 5-6.15 That determination plainly suggests the
possibility that evidence could have been presented which would have supported a
contrary conclusion.
Both the law and the facts support the existence of such a possibility in this
case. While Mr. Burnett’s compensation agreement refers to the bonus as
13 Moreover, the evidence in Long showed only that the employee had been “recommended”
for a bonus. Long, 2014 Colo. Dist. LEXIS 3576 at *8. By contrast, Mr. Burnett has presented sufficient
evidence to create a triable issue of fact as to whether his bonus had been approved.
14 Available at: https://drive.google.com/file/d/1i1ic6UO27mrmpYKojzbCzxnpeNIWictb/view
(last accessed: February 23, 2025).
15 In addition, the hearing officer noted the employee had “some credibility issues.” U.S. Beef
at 6.
12
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discretionary, discretion can be abused. Indeed, every contract in Colorado includes
an implied duty of good faith and fair dealing, see §4-1-203, C.R.S., which attaches
when the contract gives one party discretion in the performance of the terms of the
contract, City of Golden v. Parker, 138 P.3d 285, 292 (Colo. 2006). “Good faith
performance of a contract involves . . . consistency with the justified expectations of
the other party.” Amoco Oil Co. v. Ervin, 908 P.2d 493, 498 (Colo. 1995), as
modified on denial of reh'g (Jan. 16, 1996) (citation and internal quotation marks
omitted).
On the record before me, there are genuine disputes of material fact as to
whether Mr. Burnett had a reasonable, justifiable expectation that he had been
awarded a bonus.16 He sought a bonus based on his “overall contributions to the
Company, or for greatly exceeding expectations regarding productivity.” (Motion App.,
Exh. 4 ¶ 5.2 at 3.)17 His request had been approved by both his direct supervisor, Mr.
Davis, and a president of the company, Mr. Farr. The evidence suggests no previous
bonus request had ever been denied where it had received such approvals, and Mr.
Davis informed Mr. Burnett his bonus had been approved. Indeed, Mr. Burnett avers
he saw the bonus reflected in the company’s online compensation program in late
September.
16 The court’s recitation of these fact issues is illustrative and not necessarily exhaustive and
should not be taken in any wise to cabin the universe of evidence that may be presented at trial.
17 FOAM’s argument that Mr. Burnett had not met any of the additional “pre-approved” reasons
justifying a bonus is irrelevant and disingenuous given this broader language of the contract.
13
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There are also disputes of material fact as to whether FOAM abused its
discretion by denying Mr. Burnett’s bonus once it ostensibly was approved. For
example, Mr. Burnett testified his general ledger at the time he requested the bonus
reflected funds on hand more than adequate to pay the bonus and maintain reserves
for fixed expenses for almost another year. Moreover, a jury could find FOAM’s
explanation for why it ultimately could not approve Mr. Burnett’s bonus – because
doing so would have left Mr. Burnett’s branches with negative reserves – undercut by
evidence that the formula it used unfairly saddled the Englewood branch with rent
payments that could have been avoided.
Moreover, FOAM’s arguments as to the allegedly unbridled scope of its
discretion are clearly contrary to the policy considerations which animate the CWCA.
The purpose of the CWCA is “to protect employees from exploitation, fraud[,] and
oppression,” and thus the statute must “be liberally construed to carry out its [remedial]
purpose.” Nieto, 488 P.3d at 1146-47. See also §8-4-121, C.R.S. (“[A]ny agreement
. . . by any employee purporting to waive or to modify such employee's rights in
violation of this article shall be void.”) Numerous courts have interpreted this provision
as preventing an employer from interpreting or applying a contract term which would
divest an employee of earned wages, including bonuses. See, e.g., Goodwin v.
Johnson Controls, Inc., 2024 WL 5356881 at *6-7 (D. Colo. Dec. 27, 2024);
Johnson, 2023 WL 3437372 at *5; Hallmon v. Advance Auto Parts, Inc., 921
F.Supp.2d 1110, 1120 (D. Colo. 2013). See also Nieto, 488 P.3d at 1146-49 (contract
provision purporting to divest employees of earned vacation pay unenforceable). The
14
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evidence before me is more than sufficient for a jury to find that FOAM actually had
approved Mr. Burnett’s bonus request and then rescinded its approval under the guise
of a supposed additional step in the approval process. For these reasons, I find and
conclude that the motion for summary judgment as to Mr. Burnett’s CWCA claim must
be denied.
As for Mr. Burnett’s claims for breach of contract and unjust enrichment, FOAM
again relies heavily on its discretion to deny bonuses. For many of the same reasons
outlined above, it is evident there exist one or more genuine disputes of material fact
which would make summary resolution of these claims inappropriate.18 The motion as
to these claims therefore also will be denied.
THEREFORE, IT IS ORDERED as follows:
1. That Defendants’ Motion for Summary Judgment [#40] filed October 31,
2024, is granted in part and denied in part, as follows:
a. That the motion is granted as to the claims for breach of contract and
unjust enrichment against Graham Fleming individually; and
b. That in all other respects the motion is denied; and
18 The argument that Mr. Burnett did not have an enforceable contract because FOAM retained
discretion with respect to the availability of bonuses ignores the evidence suggesting Mr. Burnett already
had been “awarded” a bonus – as contemplated by the language of the contract – once both his direct
supervisors approved his request. There also is sufficient evidence to create triable issues of fact as to
whether Mr. Burnett performed under the contract.
As for Mr. Burnett’s claim for unjust enrichment, “whether the defendant's retention of the benefit
would be unjust [] calls for a fact-intensive inquiry in which courts look to, among other things, the
intentions, expectations, and behavior of the parties.” Menocal v. GEO Group, Inc., 882 F.3d 905, 923
(10th Cir. 2018) (citation and internal quotation marks omitted). There is evidence in the record from
which a jury could conclude that FOAM’s post hoc alteration of the reserves requirements and/or its
failure to tell Mr. Burnett his bonus had been denied while continuing to make use of his services in
winding down the business through mid-December 2022 were unjust.
15
Case No. 1:23-cv-02381-REB-STV Document 50 filed 02/24/25 USDC Colorado
pg 15 of 16

2. At the time judgment enters, judgment with prejudice shall enter on behalf of
defendant Graham Fleming, individually, and against plaintiff Mark Burnett, as to Mr.
Burnett’s claims for breach of contract and unjust enrichment.
Dated February 24, 2025, at Denver, Colorado.
BY THE COURT:
16
Case No. 1:23-cv-02381-REB-STV Document 50 filed 02/24/25 USDC Colorado
pg 16 of 16