CITATION: O'Reilly v. Imax Corporation, 2019 ONSC 342 COURT FILE NO.: CV-16-561057 DATE: 20190125 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: 2 ) LARRY O'REILLY ) M. Catherine Osborne & Justin Tetreault, ) for the Plaintift Plaintife ; ~and- ; ) IMAX CORPORATION ) Trevor Lawson, for the Defendant Defendant} ) ) > ) BEARD: January 11,2019 M.D. FAIETA J. 'S FOR DECISIO) INTRODUCTION [1] The Plaintif's employment as a senior executive with the Defendant was terminated without cause. On this motion for summary judgment, the Plaintiff asks that the Court find that he is entitled to the following relief for breach of his employment contract: * compensation for unpaid commissions on sales made prior to July 8, 2016, being the date of termination; ‘* 30 months’ reasonable notice of termination; * damages of unpaid base salary over the reasonable notice period; * damages for the lost opportunity to eam commissions over the reasonable notice periodsPage: 2 * damages for the lost value of various stock option grants that would have vested during the reasonable notice period; ‘* damages for pension contributions during the reasonable notice period; and ‘* damages for the value of his lost benefits over the last 24 months of the reasonable notice period in the amount of: 1) $886.23 per month for an employee benefit plan; 2) $750 per month for a car allowance; 3) $5,000.00 USD per year for an executive wellness expense account; and 4) $500.00 USD per year for a fitness expense account. BACKGROUND 2] ‘The Plaintiff was born in August 1962. He was employed by the Defendant since March 1994 in positions involving progressive levels of responsibility. The Plaintiff's Curriculum ‘Vitae describes his positions with the Defendant, since 2001, as follows: Bl January 2001 - VP & GM, Film Distribution and Theatre Sales (Americas and Europe); January 2003 ~ January 2005: SVP, Theatre Development and Film Distribution (World Wide) — led a team of 40 professionals responsible for Film Distribution, Theatre Sales, Theatre Design, Project Management and Corporate Events; September 2005 - January 2015 ~ President, World Wide Sales. Led a team of 33 professionals responsible for Theatre Sales, Theatre Design, Project Management and Corporate Events; and January 2015 - January 2016: President, Strategic Sales, Reporting to the President, IMAX Theatres and the CEO, TCL IMAX Joint Venture (China), with four primary areas of responsibility: Commercial Sales; Americas, Museum Sales: World Wide, Seles Strategy & Planning: Worldwide and Acting President, Sales and Marketing for TCL IMAX Joint Venture in Shanghai, ‘The Plaintiff's last employment agreement with the Defendant is outlined in a letter dated June 19, 2014, from Mark Welton. Mr. Welton is employed by the Defendant as President of IMAX Theatres and he directly supervised the Plaintiff from October 2011 until his termination. Mr. Welton’s letter states: Further to our recent discussions, I am writing to confirm the details of our agreement with respect to your new areas of focus and related commission opportunities in your ongoing role of President, Worldwide Sales, continuing to report to me. 1. Your principal focus and commission opportunities will be as follows: a. The sale of Institutional theatre systems worldwide — for these sales, you will be entitled to eam $15,000 per system. b. IMAX Private Theatre (IPT) sales worldwide — for these sales, we will increase your commission opportunity per sale. For a deal with a margin of $800,000-Page: 3 $999,000, you will eam $15,000 in commission and the supporting sales person(s) will receive a total of $10,000 in commission. For a deal with a margin over $1,000,000, you will earn $20,000 in commission and the supporting sales person(s) will receive a total of $15,000 in commission. ©. The Americas ~ for these sales, we will amend your commission opportunity to a $7,000 per system. (This shall replace the previous 17.5% override commission up to a threshold of $40 million commission value and 30% thereafter). 2. You will no longer be required to oversee or provide support to, nor will you receive ccomumission overrides for, theatre sales in the EMEA or Asia. All other details of your employment agreement with IMAX Corporation shall remain unchanged, including your title, reporting structure, base salary, equity opportunity, benefits, vacation entitlement, position and office location. In addition, you will continue to lead and oversee the Sales organization. This includes setting the general strategy for the sales team, partnering with the Marketing for sales initiatives and events and running the ASM. [4] The Plaintiff assumed additional responsibilities (referred to below as “other responsibilities” ) related to an IMAX joint venture under the terms of an updated job description dated February 13, 2015: Title: President, Institutional and Strategic Sales, and EVP Sales, IMAX Corporation Top Priorities (75% of time; Reporting to President, IMAX Theatres) 1. Institutional Sales (#1 TOP PRIORITY) * This includes direct oversight and Sales Management to the VP Museum Sales and Client Services 2. Sales in the Americas * Provide direct oversight and Sales management to the VP Sales Americas for commercial activity in Latin America as well as, for 2015, oversight and Sales management to VP, Sales Americas for North America exhibitors excluding AMC, Regal and Cineplex 3. General Management Support and Administrative Activities ‘* Provide sales and technical support for the Sales activities for our core Theatre Sales team on a worldwide basis, including the development of Sales and Marketing deliverables, Sales event planning and execution for major conferences and events, as well as the Annual Sales Meeting (in partnership with Marketing)