Avaya Inc.

1 printed pages contain little extracted OCR body text; searchable legal-body completeness has not been established for those pages.

OCR transcription for search; preserved printed pages are authoritative

17-10089-dsj} Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 1 of 15

UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK

AVAYA, INC., ; Chapter 11
Case No. 17-10089 (SMB)

MEMORANDUM DECISION AND ORDER
GRANTING MOTION FOR PARTIAL SUMMARY JUDGMENT

APPEARANCES:

KIRKLAND & ELLIS LLP
Attorneys for Debtor

601 Lexington Avenue

New York, New York 10022

James H.M. Sprayregen, P.C.

Jonathan S. Henes, P.C.

Patrick J. Nash, Jr., P.C.

Christina L. Briesacher, Esq.
Of Counsel

ALAN WATTENMAKER
Wattenmaker Pro Se

c/o AMI, CFC AWvAV

127 West 23'¢ Street

Apartment 501

New York, New York 10024-0501

STUART M. BERNSTEIN
UNITED STATE BANKRUPTCY JUDGE:

Alan Wattenmaker, a former employee of the debtor Avaya, Inc. (“Avaya”),! filed
secured claim no. 3103 in the amount of “$170,000 +” (the “Claim”) on May 5, 2017.2
Avaya moved to expunge and/or reclassify the Claim along with other claims in the

Debtors’ Eighth Omnibus Objection to Certain: (I) Amended Claims; (II) No Liability

! References to Avaya include its predecessor, Lucent Technologies, Inc., where appropriate.

2 A copy of Wattenmaker’s claim is annexed as Exhibit B to the Debtors’ Sur-Reply in Support of
Debtors’ Objection to Proof of Claim Number 3103 Filed by Alan Wattenmaker, dated Apr. 19, 2018
(“Sur-Reply”) (ECF Doc. # 1942). “ECF Doc.” refers to the docket entry on the CM/ECF case docket.

2
Claims; and (III) Claims to Be Modified, dated Feb. 5, 2018 (“Objection”) (ECF Doc. #
1785) and thereafter moved for summary judgment on the Objection pursuant to Fed. R.
Bankr. P. 7056 and 9014(c). (See Avaya Inc.’s Motion for Summary Judgment and
Memorandum of Law in Support, dated Nov. 21, 2018 ( “Motion”) (ECF Doc. # 2248).)
For the reasons that follow, the Motion is granted but certain issues must still be
resolved before the allowed amount of the Claim in addition to Wattenmaker’s post-
petition pension benefits can be finally determined. 3
BACKGROUND
Except as may be otherwise noted, the facts set forth are not subject to reasonable
dispute. Avaya hired Wattenmaker on April 20, 1998 and terminated him from
employment on June 11, 2009. In June 2012, Wattenmaker, represented by counsel,
sued Avaya in New York Supreme Court claiming discrimination based on age, religion
and disability. (Decision and Order, N.Y. Cty. Index No. 102877/2012, slip. op. at 1
(N.Y. Sup. Ct. dated July 22, 2016) (“Decision & Order”). 4 On or about November 26,
2013, the parties to the New York action attended a mediation and agreed to settlement
terms that were memorialized in a Settlement Term Sheet. 5 (Id. at 1, 3.) The Settlement
Term Sheet provided in relevant part that (i) Avaya would reinstate Wattenmaker for
one day on January 13, 2014 and Wattenmaker would voluntarily retire the same day;
(ii) Wattenmaker would be entitled to sixteen years of service credit (as opposed to his
3 	Consequently, the Court views the Motion as a motion for partial summary judgment.
4 	A copy of the Decision & Order is attached to the Declaration of Christina L. Briesacher in
Support of Avaya Inc.’s Motion for Summary Judgment, dated Nov. 21, 2018 (“Briesacher Declaration”)
(ECF Doc. # 2250, at ECF pp. 230-38 of 271). “ECF pp. 230-38 of 271” and similar citations refer to the
page numbers imprinted at the top of each page by the Court’s CM/ECF system.
5 	A copy of the Settlement Term Sheet is annexed to the Briesacher Declaration at ECF pp. 227-28
of 271.
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 2 of 15

3
actual service credit of roughly eleven years); (iii) Wattenmaker would get the pension,
employment retirement medical benefits and the retirement benefits to which he would
be entitled under the collective bargaining agreement with the Communications
Workers of America (“CWA”), based on the retirement date of January 13, 2014; and (iv)
Avaya would pay Wattenmaker $92,000. (Settlement Term Sheet at ¶¶ 2, 3.)
The Settlement Term Sheet contemplated a more formal agreement, (id. at ¶ 1;
Decision & Order at 2), and Wattenmaker, by his counsel, was required to deliver a fully
executed agreement by December 3, 2013 or waive his ability to receive any payments
under the settlement agreement in 2013. (Settlement Term Sheet at ¶ 11.) During the
following year, the parties exchanged documents but could not reach agreement.
(Decision & Order at 2.) Avaya forwarded what it considered the final draft on October
7, 2014 (“October Draft”), and when Wattenmaker refused to sign it, moved in state
court to enforce the Settlement Term Sheet or alternatively, the October Draft. (Id.)
The state court concluded that the Settlement Term Sheet was binding and
enforceable, (id. at 2-7), and the October Draft did not supersede it because
Wattenmaker did not sign the October Draft. (Id. at 8.) It appears that a money
judgment in the sum of $92,000 (“Judgment”) was also entered on September 14, 2016,
because Wattenmaker’s counsel filed a Notice of Entry of Judgment on or about
September 16, 2016 that referred to a Judgment. 6 However, the Notice of Appeal from
the Decision & Order filed by Wattenmaker’s counsel on September 18, 2016 did not
mention the Judgment and only referred to the Decision & Order. (See Briesacher
Declaration, Ex. C, at ECF p. 2 of 22.) The commencement of this chapter 11 case on
6 	A copy of the Notice of Entry of Judgment, dated Sept. 16, 2016, is annexed to the Claim. (ECF
pp. 16, 17 of 37.)
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 3 of 15

4
January 19, 2017 automatically stayed the appeal as to Avaya and Wattenmaker has not
sought relief from the automatic stay to prosecute the appeal.
Following the commencement of the chapter 11 case, Wattenmaker filed the
Claim.7 The principal components of the Claim were the $92,000 Avaya agreed to pay
pursuant to the Settlement Term Sheet and Wattenmaker’s pension benefits. As to the
latter, Wattenmaker estimated that he was entitled to $2,000.00 per month for forty
months (through May 2017). He also claimed he was entitled to “retirement benefits
TBD,” interest from January 2014 (also to be determined) and “expenses TBD.” After
Avaya filed the Objection, Wattenmaker updated his computations in an email to Avaya
as follows:
Payment due $92,000, pension 49 months @2000/mo. = $98,000, Legal
expenses approximately $30,000, interest from approximately January,
2014 @ 5% $11,000/year, times = 5 years = $55,000, expenses TBD =
approximate total $275,000
(Sur-Reply at ¶ 4 & Ex. C.) When informal attempts to resolve the Objection failed,
Avaya filed the Supplemental Declaration of James Kobar in Support of the Debtors’
Eighth Omnibus Objection to Certain: (I) Amended Claims; (II) No Liability Claims;
and (III) Claims to Be Modified with Respect to Claim No. 3103, dated July 11, 2018
(“Kobar Declaration”) (ECF Doc. # 2094) in support of the Objection.
Wattenmaker was out of town during the summer of 2018 working at a summer
camp, and upon his return, the Court scheduled a conference relating to the Objection
for September 6, 2018. Following the conference, the Court signed an order scheduling
the trial on the Objection for November 7, 2018. (See Order (I) Scheduling Trial Date
and Procedures in Connection With the Debtors’ Objection to Claim No. 3103, and (II)
7 	Wattenmaker actually filed twenty-five claims but all of his claims except the Claim have been
expunged. (Motion at 2 n.3.)
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 4 of 15

5
Granting Related Relief, signed Sept. 12, 2018 (ECF Doc. # 2188).) The scheduling
order also stated that the Kobar Declaration would constitute Kobar’s direct testimony
and Wattenmaker could depose Kobar at a mutually convenient time before the trial.
(Id. at ¶ 4.)
Instead of deposing Kobar, Wattenmaker filed a request for an extension of
discovery and an adjournment of the trial date. (See Motion to Extend the Due Date for
Discovery and Trial Date, in Connection with the Debtors’ Objection to Claim No. 3103,
and (II) Granting Related Relief, dated Sept. 30, 2018 (ECF Doc. # 2207).) Avaya’s
counsel disclosed at the ensuing hearing that Wattenmaker had served 133 discovery
requests consisting of document demands and/or interrogatories. (Transcript of
10/25/18 Hr’g at 11:23-12:3 (“Tr. (10/25)” (ECF Doc. # 2236).) After reviewing the
proposed discovery, the Court concluded that Wattenmaker’s discovery requests were
largely if not completely irrelevant to the three issues that governed Wattenmaker’s
pension calculation: his start date, his termination date and his band (described below)
under the collective bargaining agreement (“CBA”) between Avaya and the CWA.
Because the material facts appeared to be few and not subject to reasonable dispute, the
Court suggested that Avaya make a motion for partial summary judgment or summary
judgment. (Id. at 51:16-53:10.) In accordance with the Court’s suggestion, Avaya filed
the Motion.
The Motion
Avaya seeks summary judgment limited to determinations on the following
issues: (i) the Settlement Term Sheet is binding and enforceable, (Motion at 3-8), a
proposition that Wattenmaker does not dispute although he contends that Avaya
breached the Settlement Term Sheet (see Declaration of Claimant and Claimant’s
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 5 of 15

6
Reply to Avaya Inc.’s Motion for Summary Judgment (Claim #3103) and Declaration
of Claimant and Claimant’s Justification for Discovery, dated Dec. 11, 2018 (ECF Doc.
# 2259, at ECF pp. 4-5 of 11)); (ii) the CBA and Pension Plan govern the calculation of
Wattenmaker’s pension, the relevant information needed to calculate the pension are
not subject to dispute, (Motion at 8-9), and it follows that Wattenmaker became entitled
to a monthly pension, beginning on February 2013, in the sum of $1,123.68; (iii)
Wattenmaker has failed to identify any specific claim for additional medical or
retirement benefits to which he is entitled, (id. at 9-10), and (iv) the sum of $92,000 is
an allowable unsecured claim, not a priority claim. (Id. at 10-12.)
Wattenmaker’s contentions have been spread across numerous pleadings and are
repeated in the Claimant’s Reply and Opposition to Avaya Inc.’s Motion for Summary
Judgment and Memorandum of Law in Support of Opposition, filed Apr. 2, 2019
(“Wattenmaker Opposition”) (ECF Doc. # 2324). His principal contention is that the
Settlement Term Sheet required Avaya to reinstate him for one day as an active
employee and give him work. (See id. at ECF p. 25 of 61 (“The meaning of this condition
[reinstatement for one day] is that Avaya is obligated to reinstate Claimant, giving the
Claimant work to perform as an active full time (SCSE) with all the rights, salaries,
benefits and etc. of that position.”).) It never did, and consequently, he was never
terminated and is still employed by Avaya. (See, e.g., id. at ECF p. 13 of 61 (“Avaya
mentions that Creditor claims to be employed till this very day but has not present [sic]
a single argument to refute this statement.”); Tr. (10/25) at 15:21-16:1 (stating that he
has not been terminated and is still employed by Avaya).)
Wattenmaker points to other alleged breaches of the Settlement Term Sheet. He
contends, among other things, that Avaya has failed to provide him with wages for the
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 6 of 15

7
one day he worked, overtime pay, vacation pay, carry beeper payments, “Call out
Tech/Engineer” payments, meal and travel allowance payments, on the job educational
benefits, off the job and after-hours educational benefits, non-profit organization Avaya
match contributions/donations, leave of absence benefits, city allowance pay upgrade,
various awards, additional “cross over time” from Bell Atlantic, New York Telephone
employment and the right to view, make comments on, and get a complete copy of his
employee personal file. (Wattenmaker Opposition at ECF p. 10 of 61.) Avaya has also
deprived him of certain pension and “voluntary retirement” benefits (the latter includes
“newsletters, phone, museum, misc. discounts, monthly retirement Breakfasts that all
retirees and active (SCSEs) attend etc.”), denied him the separate medical benefits due
under the CBA or independent of the CBA, breached the confidentiality and non-
disparagement provisions and failed to comply with certain deadlines. (Id. at ECF pp.
10-12, 25-27 of 61.)
Finally, Wattenmaker argues that the $92,000 is entitled to priority because it
was not due and owing until the Judgment was entered and that occurred within four
months of the petition date, (see id. at ECF pp. 7-8 of 61), and he should be reimbursed
for expenses incurred due to Avaya’s failure to make sure that Wattenmaker received
the benefits to which he was entitled. (Id. at ECF pp. 12 of 61.) 8
8 	In a separate pleading, Wattenmaker opposes the Motion and seeks sanctions against Avaya for
failing to comply with the District Court’s Local Civil Rules 7.2 and 56.2 regarding certain
accommodations granted to pro se litigants. (Claimant’s 1st Notice of and Motion to Dismiss Avaya Inc.’s
(Entire) Motion for Summary Judgment (ECF Doc. 2248) With Prejudice and Sanctions, Suppliment
[sic] to Claiment’s [sic] Reply to Debtors [sic] Motion for Summary Judgment, dated Mar. 29, 2019 (ECF
Doc. # 2319); Claimant’s 2nd Notice of and Motion to Dismiss Avaya Inc.’s (Entire) Motion For
Summary Judgment (ECF Doc. 2248) With Prejudice and Sanctions, Supplement to Claimants [sic]
Reply to Debtors [sic] Motion for Summary Judgment, dated Mar. 31, 2019 (ECF Doc. # 2320).) The
Local Bankruptcy Rules, which govern these proceedings, do not contain similar provisions. Accordingly,
his request for sanctions is denied.
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 7 of 15

17-10089-dsj} Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 8 of 15

9
DISCUSSION
A. 	Standards Governing the Motion
As this is essentially a contract case, I briefly review the principles that govern the
determination of the Motion. When asked to interpret contractual language, the
question under New York law 9 is “whether the contract is unambiguous with respect to
the question disputed by the parties.” Law Debenture Tr. Co. of N.Y. v. Maverick Tube
Corp., 595 F.3d 458, 465 (2d Cir. 2010) (quoting Int’l Multifoods Corp. v. Commercial
Union Ins. Co., 309 F.3d 76, 83 (2d Cir. 2002)). Ambiguity presents a question of law.
Id. A contract is ambiguous if it “could suggest more than one meaning when viewed
objectively by a reasonably intelligent person who has examined the context of the entire
integrated agreement and who is cognizant of the customs, practices, usages and
terminology as generally understood in the particular trade or business.” Int’l
Multifoods, 309 F.3d at 83 (internal quotation marks and citation omitted); accord
Cont’l Ins. Co. v. Atl. Cas. Ins. Co., 603 F.3d 169, 180 (2d Cir. 2010); Maverick Tube,
595 F.3d at 466. An agreement is not ambiguous if it has a definite and precise
meaning, and unambiguous language does not become ambiguous because a party urges
a different interpretation that strains the language beyond its ordinary meaning.
Maverick Tube, 595 F.3d at 467; Seiden Assocs., Inc. v. ANC Holdings, Inc., 959 F.2d
425, 428 (2d Cir. 1992). Where the dispute concerns a provision of the contract, the
Court must consider the contract “as a whole to ensure that undue emphasis is not
placed upon particular words and phrases,” Bailey v. Fish & Neave, 868 N.E.2d 956,
9 	The Settlement Term Sheet does not state which law governs and neither side has addressed this
issue. I will apply New York law to the interpretation of the Settlement Term Sheet because it was
executed in New York to settle a New York lawsuit brought by Wattenmaker and Wattenmaker has
resided in New York at all relevant times. In any event, the Court is not aware of any conflict between
New York law and the rules of contract interpretation applicable in any other jurisdiction that might
conceivably apply.
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 9 of 15

10
959 (N.Y. 2007); accord Maverick Tube, 595 F.3d at 468, and “seek to give ‘[e]ffect and
meaning . . . to every term of [a] contract.’” XL Specialty Ins. Co. v. Level Glob. Inv’rs,
L.P., 874 F. Supp. 2d 263, 284 (S.D.N.Y. 2012) (quoting Reda v. Eastman Kodak Co.,
649 N.Y.S.2d 555, 557 (N.Y. App. Div. 1996)).
B. 	Wattenmaker’s Pension Benefit
A claim for pension benefits is based on the Avaya Inc. Pension Plan (“Pension
Plan”). 10 An employee such as Wattenmaker, who worked for Avaya for at least ten
years, becomes eligible for monthly pension benefits the day after his 65 th birthday.
(Pension Plan § 4.1(a), (b).) The amount of the monthly pension benefit is based on two
factors: the employee’s pension band and his years and months of employment, i.e., his
start date and his termination or retirement date. (Id. § 4.2(c)(i).) The pension band is
determined under the CBA 11 based on job title and locality.
The following critical information is undisputed or cannot be reasonably
disputed. First, Wattenmaker was born in January 1948 and reached his 65 th birthday
in January 2013. It appears that Avaya paid the pension on the first day of the month.
Accordingly, Wattenmaker became entitled to receive his monthly pension beginning
February 1, 2013. (See Business Records Affidavit [of Brendon Banks], dated Jan. 22,
10 	The Kobar Declaration attached the Pension Plan, As Amended and Restated Effective January 1,
2016, as Exhibit B. At the Court’s request, Avaya subsequently provided the Pension Plan, As Amended
and Restated Effective January 1, 2010. (Declaration of James Kobar In Support of Avaya Inc.’s Motion
for Summary Judgment, dated Jan. 22, 2019 (“Second Kobar Declaration”), Ex. A (ECF Doc. # 2322).)
This Pension Plan was in effect in January 2014. (Second Kobar Declaration at ¶ 2.) The relevant
portions of the 2010 and 2016 Pension Plans are identical and the Court will refer to the Pension Plan
attached to the Kobar Declaration.
11 	The CBA, effective May 24, 2009, is annexed as Exhibit A to the Kobar Declaration. The 2009
CBA is the current CBA in effect. (Kobar Declaration at ¶ 10 n. 11).)
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 10 of 15

11
2019 (“Banks Affidavit”), Ex. C., at ECF p. 308 of 332).) 12 Second, he started his
employment with Avaya on April 20, 1998 and was terminated from actual employment
on June 10, 2009. (See id.) At that point, he had accrued between 11.0833 and 11.167
years of service.13
One of the purposes of the settlement embodied in the Settlement Term Sheet
was to give Wattenmaker additional service credit by creating a new, albeit fictional
retirement date; the parties agreed that he would be reinstated and voluntarily retire on
the same day, January 13, 2014, and be entitled to sixteen years of service credit.
(Settlement Term Sheet at ¶ 2.) As the New York Supreme Court explained in enforcing
the Settlement Term Sheet:
[The Settlement Term Sheet] terminates plaintiff’s employment and
requires him to discontinue this action and not pursue arbitration over his
termination. In exchange plaintiff receives $92,000, 16 years of service
credit, and any benefits he earned under the applicable collective
bargaining agreement.
(Decision & Order at 4.) Finally, Wattenmaker conceded that if the January 13, 2014
retirement date is correct, he belonged in band 125. (Tr. (10/25) at 16:2-16.)14
12 	The Banks Affidavit was filed as part of the same document that included the Second Kobar
Declaration. (ECF Doc. # 2322.)
13 	Wattenmaker worked for Avaya for eleven years, one month and twenty days, ten days shy of his
monthly anniversary date. It is not clear if he is entitled to receive service credit only for completed
months, i.e., eleven years and one month (11.0833) or a full month’s credit for the partial month, i.e.,
eleven years and two months (11.167). Because the Settlement Term Sheet fixed his service credit at
sixteen years, the Court need not resolve this question.
14 	Wattenmaker now states that “after more careful review the pension band 125 based on my job
function is also in dispute.” (Wattenmaker Opposition, ECF p. 16 of 61.) He has not identified what band
he belongs in or pointed to a different band in the CBA. Wattenmaker cannot create a factual dispute
simply by saying “I don’t agree.” See Fed. R. Civ. P. 56(c)(1)(A) (party disputing fact must support his
assertion by “citing to particular parts of materials in the record, including depositions, documents,
electronically stored information, affidavits or declarations, stipulations (including those made for
purposes of the motion only), admissions, interrogatory answers, or other materials”).
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 11 of 15

12
Given a band of 125 and sixteen years of service credit, we can readily compute
Wattenmaker’s monthly pension under the unambiguous provisions of the Pension
Plan. According to the table on pages 30-31 of the Pension Plan, (see Kobar
Declaration, Ex. B, at ECF pp. 68-69 of 244), his monthly pension is $70.23 multiplied
by his sixteen years of service, or $1,123.68. 15
Wattenmaker’s proffered interpretation, that Avaya never gave him duties, never
terminated him and still employs him, is unreasonable. The Settlement Term Sheet was
entered into more than four years after Wattenmaker last worked for Avaya and a year
after Wattenmaker had sued Avaya for employment discrimination. It settled a
litigation; it was not an employment agreement. Reading the Settlement Term Sheet as
a whole, Wattenmaker’s simultaneous reinstatement and retirement was part of the deal
to give him more service credit and a larger pension, not new duties for the one day he
was deemed to be reinstated. In addition, it granted him the retirements under the CBA
based on a retirement date of January 13, 2014. The Settlement Term Sheet is
unambiguous on this critical issue, and I conclude as a matter of law that Wattenmaker
was terminated on January 13, 2014 and became entitled under the Pension Plan to
receive a monthly pension of $1,123.68 beginning on February 1, 2013.
C. 	Wattenmaker’s Other Arguments That Avaya Breached the Settlement
Term Sheet Lack Merit.
Wattenmaker maintains that Avaya breached the confidentiality and non-
disclosure agreements. Under the Settlement Term Sheet, the confidentiality and non-
15 	The same table shows that based on his actual termination date in June 2009, his monthly
pension would have been $67.53. Whether multiplied by 11.0833 or 11.167 years of service credit, the
Settlement Term Sheet increased Wattenmaker’s monthly pension benefit by almost $400.
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 12 of 15

13
disparagement provisions (¶¶ 6, 7) bind only Wattenmaker. In addition, his allegations
of breach are conclusory.
Wattenmaker further alleges that Avaya breached the Settlement Term Sheet by
failing to provide a litany of employment and voluntary retirement benefits summarized
above, benefits that supposedly attached to his reinstatement and voluntary retirement.
(See Wattenmaker Opposition at ECF pp. 9-10 of 61.) Many of the benefits he lists
incorrectly assume that he became an active employee of Avaya after January 13, 2014
and remains an active employee to this day. In addition, the Settlement Term Sheet did
not provide these benefits and Wattenmaker has failed to identify their source, such as
the Pension Plan, the CBA, employment manuals or similar documents. Wattenmaker
also fails to identify any employment and voluntary retirement benefits available to him
under the CBA or otherwise that he has not received. For example, he has not pointed
to any expense he incurred that Avaya wrongfully refused to fund. Accordingly, Avaya is
entitled to partial summary judgment to the extent that the Claim seeks a monetary
award based on the failure to provide retirement benefits other than his monthly
pension benefits granted under the Pension Plan.
D. 	The Classification of the $92,000 Claim
Wattenmaker’s argument that a portion of the $92,000 settlement is entitled to a
wage priority lacks merit. The Bankruptcy Code affords a limited priority for “wages,
salaries, or commissions, including vacation, severance, and sick leave pay” that were
“earned 180 days before the date of the filing of the petition,” 11 U.S.C. § 507(a)(4)(A)
(emphasis added) and “claims for contributions to an employee benefit plan . . . arising
from services rendered within 180 days before the date of the filing.” 11 U.S.C. §
507(a)(5)(A) (emphasis added). Wattenmaker’s claim for employment discrimination
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 13 of 15

14
accrued no later than the date he was terminated by Avaya in June 2009. The $92,000
settlement as well as the other provisions of the Settlement Term Sheet, executed in
November 2013, resolved that claim and any other claims that Wattenmaker had
relating to his employment with Avaya.
Wattenmaker’s contention that the $92,000 was not earned until the Decision &
Order was filed in September 2016, within the 180-day period, is wrong. He confuses a
disputed claim with an unmatured claim. By June 2009, all of the facts that gave rise to
his employment discrimination claim (and Avaya’s alleged liability) were fixed. At that
point, Wattenmaker held an unliquidated, matured, disputed employment
discrimination claim and brought a lawsuit in 2012 on that claim. The Settlement Term
Sheet merely liquidated the claim and rendered it undisputed. Even using the
reinstatement/retirement date of January 13, 2014 as Wattenmaker’s last date of
employment, the settlement was still not “earned 180 days before” the petition date or
based on services rendered “within 180 days” of the petition date. Accordingly, Avaya is
entitled to partial summary judgment determining that Wattenmaker’s claim for
$92,000 is a general, unsecured claim, not a priority claim.
E. 	Unresolved Questions
Having determined the amount of Wattenmaker’s monthly pension benefit and
the correct classification of the $92,000 settlement, certain factual and legal issues
preclude a complete disposition of the Claim and the Objection.
First, the Claim includes legal fees and “expenses TBD.” These were not
addressed in the Motion.
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 14 of 15

15
Second, the computation of the pension benefit portion of the Claim requires
further factual development. At some point, Wattenmaker refused the tender of pension
benefit payments and equitable principles may stop the running of interest on the
payments he refused. See Koch v. Greenberg, 14 F. Supp. 3d 247, 285 (S.D.N.Y. 2014).
Third, the parties dispute the date that interest began running on the $92,000
settlement. Avaya concedes that interest may be owed from the date of the entry of the
judgment enforcing the Settlement Term Sheet to the petition date. (Motion at 10 n. 5.)
Wattenmaker contends that it began to accrue on the date that the Settlement Term
Sheet was signed. (Wattenmaker Opposition at ECF pp. 46-47 of 61.) The accrual of
pre-verdict interest is governed by N.Y.C.P.L.R. § 5001. The parties will have an
opportunity to clarify their positions regarding the date on which interest began to
accrue in future proceedings.
For the reasons stated, the Motion is granted. The Court has considered
Wattenmaker’s other arguments and concludes that they lack merit. The parties should
contact chambers to schedule a hearing to address further proceedings.
So ordered.
Dated: 	New York, New York
April 22, 2019
/s/Stuart M. Bernstein
STUART M. BERNSTEIN
United States Bankruptcy Judge
17-10089-dsj Doc 2329 Filed 04/22/19 Entered 04/22/19 11:07:05 Main Document
Pg 15 of 15