Vernon L. Haag v. International Telephone and Telegraph Corporation, a Maryland Corporation

342 F.2d 566
CourtCourt of Appeals for the Seventh Circuit
DecidedApril 2, 1965
Docket14776
StatusPublished
Cited by3 cases

This text of 342 F.2d 566 (Vernon L. Haag v. International Telephone and Telegraph Corporation, a Maryland Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vernon L. Haag v. International Telephone and Telegraph Corporation, a Maryland Corporation, 342 F.2d 566 (7th Cir. 1965).

Opinions

ENOCH, Circuit Judge.

This case is here for the second time. Plaintiff, Vernon L. Haag, brought suit originally in the state court (subsequently the cause was removed to the U. S. District Court) to recover damages arising out of the refusal of the defendant, International Telephone and Telegraph Corporation, to honor his attempted exercise of a stock option. The District Court granted summary judgment for defendant and plaintiff has taken this appeal.

On or about August 11, 1957, defendant had engaged plaintiff as an employee. On September 11, 1957, defendant gave plaintiff an option to buy certain shares of its common stock “only after two years of the Optionee’s continued employment with the corporation or one of its subsidiaries.”

In his initial suit, plaintiff contended that defendant’s determination that plaintiff’s employment terminated before the passage of the necessary two years failed to consider an alleged oral contract of employment for a period of 90 days, made on or about June 22, 1959.

In this Court’s opinion on the original appeal, No. 14134, filed November 12, 1963, 324 F.2d 205, we stated (p. 208):

“We do, however, agree with the plaintiff that if, in fact, on and after June 22, 1959, he had a contract of employment with the defendant for a fixed and definite term [567]*567embracing the ninety day period ending September 20, 1959, as he alleges and claims he did, and if his discharge on July 28, 1959, was without just cause and for the purpose of depriving him of attaining the right to exercise his stock purchase option, the defendant is liable for such damages as may have been occasioned thereby.”

The cause was remanded to the United States District Court where it was tried to a jury. The jury found for the plaintiff and answered “yes” to the following special interrogatory:

“QUESTION: Did the plaintiff, Haag, and the defendant International Telephone and Telegraph, on June 22, 1959, enter into an oral contract of employment for a fixed and definite term embracing the ninety-day period ending September 20, 1959?”

Defendant had filed motions for a directed verdict at the close of plaintiff’s evidence and at the close of all the evidence, asserting that the evidence was insufficient as a matter of law to establish that plaintiff had a contract of employment for a fixed and definite term. The District Judge reserved his ruling on these motions, following the good practice recommended by this Court in Reitan v. Travelers Indemnity Co., 1959, 267 F.2d 66, 68. Pursuant to the defendant’s motion, the District Court set aside the jury’s verdict and entered judgment for defendant notwithstanding the verdict, which the District Court found to be clearly against the greater weight of the evidence and not such as might have been reasonably reached.

The District Judge for that reason also granted (conditionally) the defendant’s motion for a new trial.

It was not contested that plaintiff s . original hiring was at will. Plaintiff asserted that a change in his employment occurred at a meeting with Delbert L. Mills, an executive vice-president of one of defendant’s divisions at Clifton, New Jersey, on June 22, 1959. He agreed that he was then removed from his prior assignment at defendant’s Fort Wayne location, so that someone else could take over that job. He said that he was instead placed on a special assignment for 90 days which would permit him to complete the two years’ employment necessary to exercise his stock option. He states that the arrangement was such that if he found another position he was free to leave; that it was at his option whether or not to remain in the defendant’s employ for the whole of the 90 days, but that defendant was bound. Plaintiff testified that Mr. Mills did not ask him to hold himself available in any capacity after June 22, 1959, but that he himself had stated that he would be available. He testified that defendant had plaintiff’s home address and telephone number and that he could be reached from there. Nobody described the duties of the “special assignment” to him and plaintiff never asked Mr. Mills what the special assignment was, or ever reported to Mr. Mills on this special assignment after the aforesaid meeting of June 22, 1959. Plaintiff also testified that at the meeting on June 22, Mr. Mills told plaintiff to start looking for other employment immediately.

After cleaning out his desk at Fort Wayne on June 23, 1959, plaintiff never performed any services for defendant and, to his knowledge, never went back to the defendant’s premises except when he attempted to exercise his stock option. It was understood that he was to be allowed to devote as much time as he wished to his search for new employment. Plaintiff testified further that he did shortly thereafter seek new employment, travelling extensively throughout the United States through June, July and August, 1959.

[568]*568The defendant's witnesses, Mr. Mills and another vice-president, Robert Cha-sen, testified that at the meeting they had with plaintiff on June 22, 1959, he was relieved of all responsibility but that Mi*. Mills agreed to keep him on the payroll for a period not to exceed 90 days while he sought other employment; that there was no “special assignment,” that phrase being used only to create the impression that plaintiff was currently employed for its effect on plaintiff’s efforts to secure new employment. Plaintiff did not deny that this explanation was given to him, but testified that he did not recall its being said.

Plaintiff testified that there was no mention of the option at the meeting June 22, 1959.

Under date of July 28, 1959, plaintiff received a letter from Mr. Mills reading as follows:

“Dear Yernon, Supplementing our previous oral discussion it has been decided to terminate your employment immediately as of today, July 28, 1959. We are instructing Mr. Brunton to issue a check for $5,462, reduced by necessary withholding, as a final lump sum payment for separation allowance. Since you are not eligible to exercise your stock option would you please return pertinent papers to me at your earliest convenience. With very best wishes for your future activities, very truly yours — ”

to which he replied that he had continuously remained available to the company as an employee and would remain available until September 21, 1959. He did not in fact accept any other employment during the 90-day period.

The District Court applied the standards of Shaw v. Edward Hines Lumber Co., 7 Cir., 1957, 249 F.2d 434, 439, and Lambie v. Tibbits, 7 Cir., 1959, 267 F.2d 902, 903, that in ruling on a motion for judgment notwithstanding the verdict •the evidence must be considered in the light most favorable to the plaintiff with all conflicts resolved in his favor and every possible legitimate conclusion or inference drawn in his behalf. Wisconsin Liquor Co. v. Park & Tilford Distillers Corp., 7 Cir., 1959, 267 F.2d 928

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342 F.2d 566, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vernon-l-haag-v-international-telephone-and-telegraph-corporation-a-ca7-1965.