## Facts

- LECG, LLC employed Dr. Sanjay Unni for many years; he rose to senior roles and later became a director.
- Unni signed a written employment agreement making his employment at-will, allowing either party to end the relationship at any time, with or without cause.
- The written employment agreement contained an integration clause stating it was the entire agreement between the parties on its subject matter and superseded prior or contemporaneous oral understandings.
- After Unni became a director, he signed a Director Agreement that provided $500,000 in “advance bonus” payments.
- The Director Agreement stated the advance was not earned when paid and was an advance against future bonuses; future bonuses were not guaranteed.
- The Director Agreement provided that Unni would repay the advance through offsets against future bonuses and that, if his employment ended before the advance was fully recouped, he would repay the outstanding balance.
- LECG later experienced financial difficulties and reduced staff.
- Unni claimed the staffing reductions and company turmoil reduced his ability to generate work and earn bonuses sufficient to offset the advance, and he believed he could not continue to build his career at LECG.
- Unni gave notice and resigned. LECG demanded repayment of the unpaid balance of the advance, but Unni did not pay.
- LECG sued for breach of contract and unjust enrichment. Unni filed counterclaims, including breach of contract, breach of an oral agreement, and constructive discharge, and argued defenses based on impossibility/impracticability and frustration of purpose.
- The parties filed cross-motions for summary judgment.

## Issues

1. Whether the Director Agreement unambiguously required Unni to repay the unpaid balance of the advance bonus when his employment ended before the advance was fully offset by future bonuses.
2. Whether LECG’s financial problems and staffing reductions discharged or excused Unni’s repayment duty under impossibility/impracticability or frustration of purpose.
3. Whether Unni’s counterclaims for breach of contract, breach of an oral agreement, and constructive discharge could survive summary judgment in light of the at-will and integration terms and the evidence of working conditions.

## Decision

- The court granted LECG’s motion for summary judgment on its breach-of-contract claim requiring repayment of the outstanding advance-bonus balance.
- The court denied Unni’s motion for summary judgment.
- The court rejected Unni’s defenses based on impossibility/impracticability and frustration of purpose.
- The court granted summary judgment against Unni on his counterclaims (including breach of contract, breach of an oral agreement, and constructive discharge).
- Judgment was entered against Unni for $366,790.

## Legal Principles

- When contract language is clear, courts enforce it as written, including repayment terms for an advance against future, non-guaranteed bonuses.
- In an at-will employment relationship, a party cannot rely on an alleged assumption of guaranteed continued employment that conflicts with the written at-will term.
- Impossibility/impracticability and frustration of purpose require more than a business downturn or workplace disruption; ordinary commercial developments that affect expected earnings generally do not discharge a payment obligation.
- A duty to repay money is not excused merely because repayment becomes harder due to reduced income or reduced opportunity to earn anticipated compensation.
- An integration clause bars claims based on prior or side oral promises that contradict or add to the written agreement’s terms on the same subject.
- Constructive discharge requires working conditions so intolerable that a reasonable person would feel compelled to resign; financial distress, staffing cuts, and reduced business prospects, without more, do not meet that standard.

## Conclusion

The court held that Unni’s at-will status and the Director Agreement’s express terms required him to repay the remaining balance of a $500,000 bonus advance when he resigned before offsets through future bonuses repaid it, and that LECG’s financial difficulties and staff reductions did not excuse repayment or support Unni’s counterclaims, resulting in summary judgment for LECG and a $366,790 judgment against Unni.


LECG, LLC v. Unni, 2014 WL 2186734 (2014)