George S. Fischer, Appellant-Petitioner,
Jennifer M. Fischer, Appellee-Respondent.
from the Lake Superior Court The Honorable Cheryl Williamson,
Senior Judge The Honorable Elizabeth Tavitas, Judge The
Honorable Thomas Hallett, Magistrate Trial Court Cause No.
Attorney for Appellant Edward J. Calderaro Sachs & Hess,
P.C. St. John, Indiana.
Attorneys for Appellee Brian R. Gates Mark J. Phillipoff
Jones Obenchain, LLP South Bend, Indiana.
Summary and Issue
Jennifer Fischer filed for dissolution of her marriage to
George Fischer on October 30, 2014. The trial court held a
final hearing on August 27, 2015, and issued an order
dissolving the marriage on November 23, 2015. George appeals
the dissolution decree, raising two issues for our review,
which we consolidate and restate as one: whether the trial
court abused its discretion in dividing the value of certain
stock options as part of the marital estate. Concluding the
value of the stock options at issue are not properly included
in the marital estate, we reverse and remand.
and Procedural History
George and Jennifer were married in 1998. Although they have
one child, born in 2003, this appeal only involves a property
division issue. Jennifer filed a petition for dissolution of
marriage in October 2014, and the trial court held a final
hearing in August 2015. George testified that since May of
2011, he has worked for E*Trade, where he earns a base salary
plus discretionary bonuses and stock options. In trying to
establish George's income for child support purposes
based upon George's August 7, 2015 earnings statement
from his employer, Jennifer's counsel stated,
[George is] telling us he believes he will receive no further
stock options, no further bonuses for the year, he's not
sure about holiday pay. In order to figure out what his total
gross is going to be for the year 2015, . . . I took his base
pay, uh, of [$11, 538.46] per pay period times twenty six
pays, comes out to exactly [$299, 999.96]. . . . I've
added to that the bonus that he received this year, which is
$325, 000.00. I've added the holiday pay of [$7, 788.47]
to that, and I've added the, the stock options that he
received of $149, 739.62.
Vol. II at 35-36. When asked if he had reason to contest that
as his projected 2015 income, George conceded he did not,
"[p]rovided I work through the end of the year."
Id. at 36-37.
With regard to the stock options referenced in counsel's
remarks above, the evidence establishes George has a stock
options account which includes both vested stock options that
could be sold by him immediately and unvested stock options
"where the sale date has not hit yet." Id.
at 13. Sometime in 2015, stock options previously granted to
him as part of his compensation reached their "sale
date" and vested in the amount of $149,
739.62. Taxes owed for the vested stock options
were paid by the company selling a portion of the now- vested
stock options to cover the tax. Under questioning from
Jennifer's counsel, George explained:
A The hundred and forty nine thousand on [the August 2015
earnings statement] at the stock option option [sic] line . .
. was the amount that was vested for the year 2015.
Q Okay, from a prior award? Not from stocks that you received
options on through the year 2015 . . . from stocks that you
received the options on in one or more prior years.
A Or it could have been in the same year. Yes, it, it's
previously granted stock, some of which hasn't vested yet
and some of which is. . . . It did this year.
Q So, these are stocks that had vested, yet they were
acquired during the marriage, that you're paying taxes on
this year? . . .
A That I - I've paid taxes on this year? Correct. . . .
But, I dispute the terminology, but these are ves - at that
time of vesting, I am taxed and that's what you see [on
the earnings statement]. . . . They weren't acquired,
they were granted by my firm. Typically based on performance.
Q Okay, if you want to use the term granted, I'm not
gonna dispute that, but they became available through your
employer, whether you want to say grant or acquire, during
the marriage, correct?
Id. at 80-81.
On cross-examination by his own counsel, George elaborated:
Q [A]s part of your compensation, you receive a - there's
a stock option to that, correct?
Q And how does that ...