SAN FRANCISCO — IBM is facing charges — again — that it stiffs its own salespeople out of commissions after a once-dead lawsuit is revived by the courts.
On Thursday, the US Fourth Circuit Court of Appeals vacated a dismissal granted to IBM in November 2018, as first reported in the UK’s The Register.
The appeals court ruled that the District Court erred when it tossed plaintiff Justin Fessler’s claim against Blue Blue over unpaid sales commissions.
Fessler alleges that IBM unlawfully “capped” his sale commissions after repeatedly telling him his earning potential would be uncapped.
In one instance, Fessler closed a deal with the US Customs and Border Protection agency for $5,200,000 in late December 2017. He expected his commissions on this to be paid at the end of February 2018, which he ultimately did not receive.
“In sum, we find that Fessler adequately alleged sufficient facts to permit a plausible inference that IBM committed fraudulent misrepresentation and constructive fraud,” the decision stated this week.
The case now goes back to the US District Court in Alexandria, Virginia, for written discovery and depositions.
“We are disappointed in the decision but confident that we will ultimately be successful on the merits,” an IBM spokesperson was quoted as saying in The Register.