Hardenbrook v. United Parcel Service, Inc.

490 F. App'x 45

Opinions

MEMORANDUM

Footnotes

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Darel Hardenbrook brought suit against UPS alleging claims for breach of contract, breach of the implied covenant of good faith and fair dealing, and wrongful termination in violation of public policy. Harden-brook’s wrongful termination claim proceeded to trial and the jury returned an award of $1,436,367 in front pay and $40,000 in back pay, for a total of $1,476,367. The district court denied UPS’s motion for a new trial conditioned on Hardenbrook accepting a remittitur in the amount of $713,169 — or $673,169 in front pay and $40,000 in back pay, which he did. We have jurisdiction under 28 U.S.C. § 1291, and we affirm in part and reverse and remand in part.

UPS argues that the district court erred in offering Hardenbrook a remittitur that includes twenty-seven years of front pay. The proper amount of a remittitur is the maximum amount sustainable by the evidence. See D & S Redi-Mix v. Sierra Redi-Mix & Contracting Co., 692 F.2d 1245, 1249 (9th Cir.1982). “When considering an award of damages for lost future benefits, the question is whether the plaintiff has proven the damages relating to future losses with reasonable certainty.” O’Dell v. Basabe, 119 Idaho 796, 810 P.2d 1082, 1098 (1991). The factors to consider include “ ‘the plaintiffs salary history, scheduled or mandated pay raises, and a finding based on the evidence in the record of the time which it will take the plaintiff to find comparable employment with a commensurate salary, at which time the award of front pay should be discounted [sic].’ ” Hummer v. Evans, 129 Idaho 274, 923 P.2d 981, 985-86 (1996) (quoting O’Dell, 810 P.2d at 1098, but misquoting “discontinued” as “discounted”); see also Cassino v. Reichhold Chems., Inc., 817 F.2d 1338, 1347 (9th Cir.1987) (explaining that front pay is intended to be temporary in nature and “must be reduced by the amount [the] plaintiff could earn using reasonable mitigation efforts”).

The district court rejected the jury’s initial award, finding that the assumptions upon which it relied were “too speculative.” In determining the proper amount of the remittitur, the district court considered Hardenbrook’s expected years of employment at UPS, the comparability of Hardenbrook’s jobs post-UPS, the valuation of UPS restricted stock units, and the defined benefit plans offered by UPS and Hardenbrook’s subsequent employer. The district court relied on the evidence in the record, and the findings of the jury, to determine that had Hardenbrook not been fired from UPS, he likely would have remained with the company through retirement. This finding is supported by the evidence.

Additionally, the district court did not err in including the discretionary bo nus provided by UPS in the front pay analysis. The evidence shows that Har-denbrook received a bonus in his two last full years with UPS, there was no evidence presented that this bonus would cease to be paid in the future, and the evidence shows that it was unlikely that any bonus would be paid to Hardenbrook by his new employer.

The district court also did not err in rejecting UPS’s argument that Harden-brook’s current job is substantially equivalent to UPS, even with a lower salary, because he is required to work significantly fewer hours. The district court found that “the value of this difference was not quantified at trial” and thus “there [wa]s no evidence upon which to value the difference.” The district court did not abuse its discretion in rejecting the contention that Hardenbrook should have taken a second job to fully mitigate his damages.

UPS next claims that the district court’s award double-counted back-pay damages. Based on all the evidence, the district court concluded that “the proper amount of a remittitur, or the maximum amount sustainable by the evidence, is $673,169 in front pay damages and $40,000 in back pay.” The front pay figure was based entirely on the calculations offered by Hardenbrook’s expert. Notably, the expert’s calculations included $149,615 for “Value of Past Lost Wages and Benefits,” i.e., back pay. Thus, this calculation includes both back pay and front pay damages. Because the jury explicitly found, and the district court affirmed in the remittitur, that the proper amount of back pay damages was $40,000, the inclusion of an additional $149,615 for back pay was without support in the record and an abuse of discretion by the district court. We reverse the judgment. On remand, Hardenbrook’s damages should be reduced by $149,615.

Finally, UPS contends that the district court failed to discount the restricted stock to present value. Hardenbrook’s expert testified as to how he arrived at a net discount rate of zero. UPS’s expert strongly objected to this analysis as “completely wrong” and “makfing] absolutely no sense.” Although, the district court was “concerned” about the zero percent discount rate because it “seems to ignore the time value of money” and is not supported by “basic economic principles,” the court accepted that rate because UPS’s expert failed to provide any evidentiary basis for the discount rate it suggested. Because the district court’s conclusion appears to place the burden of proving the correct discount rate on the defendant, we reverse and remand to the district court, on an open record, for reconsideration in light of Watkins Co. v. Storms, 152 Idaho 531, 272 P.3d 503, 511 (2012) (holding that plaintiff has the burden to prove present value of damages, including the proper discount rate).

The case is remanded to the district court for further proceedings in accordance with this holding.

AFFIRMED in part; REVERSED and REMANDED in part. Each party to bear its own costs.

This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.