FINDINGS OF FACT AND CONCLUSIONS OF LAW
Plaintiff Gary Webber sued International Paper Company ("IP") underthe Maine Human Rights Act, 5 M.R.S.A. § 4551 et seq. ("MHRA"),alleging that his dismissal as part of a company-wide reduction in forcewas motivated by his disability. The action was removed to federal courtbased on diversity jurisdiction. At trial, the jury found for Mr. Webber,and awarded compensatory and punitive damages. Claims for front and backpay are now before the Court. Pursuant to Federal Rule of Civil Procedure52(a), the Court makes the following Findings of Fact and Conclusions ofLaw with regard to Mr. Webber's claims for front and back pay.
I. FINDINGS OF FACT
Background. Gary Webber was born January 25, 1953; he is 51years old as of the date of this opinion. Mr. Webber was employed at theBucksport mill beginning in November of 1983. International Paperacquired the Bucksport mill in 2000. During hisPage 2tenure at the mill, Mr. Webber worked in various positions; in thesummer of 2001, Mr. Webber was employed as a project engineer. Mr. Webbertestified that if he had not been terminated, he intended to work at theBucksport mill until he reached the age of 65.
As of July 15, 2001, the date of his termination, Mr. Webber's annualsalary was $59,143; he also received non-salary benefits includingmedical insurance, dental insurance, life insurance, and long-termdisability insurance.1
History of Disability. Mr. Webber has a history of problemswith his knees, which impair his mobility and have required him toundergo several surgeries. While he was employed at the Bucksport mill,his knee surgeries and recuperation from surgery sometimes rendered himunable to report for work. During these periods, International Paper (orits predecessors) continued pay Mr. Webber his full salary, pursuant tothe "salary continuance" short-term disability plan. (Evid. Hr'g Tr. at26, Evid. Hr'g Def.'s Ex. DD.)
As of the evidentiary hearing on November 24, 2003, Mr. Webber wasscheduled to undergo another knee surgery in January 2004, which heanticipated would require a three- to four-month recuperationperiod following the surgery, during which time he would not be able toreport for work.
Termination and Offer of Reinstatement. On June 25, 2001, Mr.Webber was informed that his position was being eliminated as of July 15,2001 as part of a company-wide reduction in force. His last regularsalary payment occurred on July 15, 2001.Page 3
Shortly after being notified of his impending termination, Mr. Webberretained a lawyer. A complaint was filed with the Maine Human RightsCommission on August 10, 2001. David Libby, the Human Resources Managerat the Bucksport mill, telephoned Mr. Webber on September 25, 2001 tooffer him the opportunity to return to work at the Bucksport mill in theposition of "SQA Coordinator." The pay and benefits would have been thesame as at his previous position as a Project Engineer, and the work waslargely sedentary. Mr. Webber turned down the offer. Mr. Libby telephonedMr. Webber at least once thereafter to re-extend the offer to him.Although Mr. Webber's immediate supervisors would have been differentfrom his immediate supervisors as a project engineer, correspondence fromMr. Webber's attorney to IP indicated that Mr. Webber did not wish toreturn to a position that would be "subject to the overall control of theMill Manager and the Human Resources Manager, who were the twoindividuals who terminated Mr. Webber." (Trial Ex. D-20.) At trial, Mr.Webber explained that he turned down the position because: I was loyal to them all those years [and had filed a complaint with the Maine Human Rights Commission after my termination] and all of a sudden, a job that was opened up when they fired me is now available to me. I didn't feel that I could trust them. I figured I'd be there a short amount of time, and I'd be terminated again.(Trial Tr. at 133-34.) On cross-examination, Mr. Webberacknowledged that his concern that he would be re-hired only to beterminated again was not based in fact and was purely speculative.
Long-Term Disability Coverage. In 2001, IP provided itsemployees with mandatory long-term disability insurance that would paybenefits equal to 60% of the worker's salary in the event of a qualifieddisability. The annual premiums paid by IPPage 4with respect to Mr. Webber's long-term disability insurancecoverage totaled $507 in 2001. In 2001, Mr. Webber contributed anadditional $126 annually to increase his long-term disability coverageso that in the event of disability, he would receive benefits equal to70% of his salary.
International Paper's long-term disability insurance plan wasself-insured: premiums paid by the company, together with anysupplemental premiums paid by employees were deposited in an account fromwhich disability benefits were paid by the third-party administrator,Wausau Benefits, Inc.
Long-Term Disability Benefits. On July 8, 2001, after he hadbeen informed of his impending termination but before his regular salaryhad been discontinued, Mr. Webber applied for long-term disabilitybenefits. On July 20, 2001, Mr. Webber was informed that his applicationfor long-term disability benefits had been approved. Mr. Webber receivedlong-term disability benefits from August of 2001 to October of 2003.
The long-term disability benefit was paid in monthly payments of$3,365.83. During the time that Mr. Webber received long-term disabilitybenefits, he also continued to receive the medical benefits he hadreceived during his regular employment at the mill. The dental benefitshe and his family had received when he was an employee were discontinued.Under the provisions of the policy, if Mr. Webber obtained employmentwhile receiving long-term disability benefits, his long-term disabilitybenefits would be negatively affected.
Job Search. Mr. Webber described his job search following hisdismissal from the Bucksport mill as follows:
I have applied for a position at Jackson Lab, which was very similar to the position I held at the mill, Home Depot, the IGA in Trenton. I found aPage 5 technical position job search called PJ Scout on the Internet, and I checked that. They send me updates for technical positions in the area. Most have been in New Jersey [and] New York, so they haven't qualified. I check the Bangor Daily News daily, especially on the weekends. I've checked the local papers — Ellsworth American, Bar Harbor Times. And there's one in — based out of Bangor, downtownme.com.
(Evid. Hr'g Tr. at 20-21.) Mr. Webber focused his job search ontechnical positions generally because he did not have an engineeringdegree.
Mr. Webber did not go to the unemployment office to check job listings.At the evidentiary hearing, Mr. Webber testified that he had completed atotal of six applications for work from the date of his discharge to thedate of the hearing, but could only remember three of them. He testifiedthat these six positions were the only positions available that he"thought [he] could do with [his] restrictions." (Evid. Hr'g Tr. at 46.)The first application was for a job as facilities manager at the JacksonLaboratory, a position that required an engineering degree. Mr. Webberrecognized that he was not qualified, but knew that the position had beenopen for two years, and thought perhaps he could be competitive without adegree. He also applied for employment at a local grocery store and atThe Home Depot, despite the fact that there were no open positions witheither employer at the time of his applications. Mr. Webber testifiedthat he was unable to find a job that he believed he could perform withhis limited mobility.
Mr. Webber testified that he applied for employment at the JacksonLaboratory and The Home Depot in the autumn of 2001, and could notremember whether he applied for employment at the grocery store in 2001or in the spring of 2002.
Recertification/retraining. Although Mr. Webber had worked asan industrial arts teacher for almost eight years prior to his employmentat the Bucksport mill, he did not seek employment in that field followinghis termination. Mr. Webber testified that hePage 6did not have a teaching certificate, and that he did not seek toobtain a teaching certificate after his termination. He indicated that hewas "not too sure [he] wanted to go back into teaching." (Evid. Hr'g Tr.at 48.) In order to obtain certification, Mr. Webber testified that hewould need to complete between four and six classes at the University ofMaine at Orono, and that it was difficult for him to drive from his hometo the university to attend classes. Mr. Webber testified that he metwith a counselor "about retraining or trying to find some otheroccupation that might be within my restrictions." (Evid. Hr'g Tr. at 47.)Apparently as a result of his consultation with the counselor, Mr. Webbertook one course in horticulture or landscape design.
Volunteer work. Mr. Webber testified that he has served onthe school board of the local school union for twelve years. In addition,following his termination from his position at the Bucksport mill, Mr.Webber developed a database to keep track of the chemicals used in theschool building, a database similar to that used at the mill.
Evidence of job opportunities/failure to mitigate. At thehearing, IP asked Mr. Webber whether he knew of several employers in Mr.Webber's geographic area: St. Joseph's Hospital, University of Maine,Eastern Maine Medical Center, the Ellsworth hospital, and Husson College.IP did not establish that those employers had open positions or that Mr.Webber would have been eligible for any such positions, nor did itintroduce any evidence as to the compensation that Mr. Webber could haveearned had he pursued such positions with reasonable diligence.
Current job availability at the Bucksport mill. A subsequentreduction in force occurred at the Bucksport mill in the Fall of 2003,and two additional project engineer positions were eliminated. Each ofthe positions eliminated was occupied by anPage 7individual with a four-year engineering degree. Both of the projectengineers whose positions were terminated are scheduled to continueworking at the mill until September of 2004. The SQA Coordinator positionwas not eliminated in the Fall 2003 reduction in force.
Although there are no open positions in the engineering departmentwhere Mr. Webber worked at the time of his termination, IP has statedthat it prefers reinstatement to front pay and that it is willing createa position for Mr. Webber, should the Court determine that front pay orreinstatement is appropriate. Mr. Webber has indicated that he wouldconsider accepting a position at IP, but noted that he will be unable towork for three to four months following his January 2004 knee surgery.
Jury Verdict. On October 10, 2003, the jury rendered averdict in favor of Mr. Webber, and awarded compensatory damages of$1,000,000 and punitive damages of $2,000,000. The jury was also askedthe following question: "Has International Paper proven by apreponderance of the evidence that Gary Webber should have accepted theoffer of employment as SQA Coordinator on or after September 25, 2001?"The jury answered in the negative.
II. CONCLUSIONS OF LAW
Based on the foregoing findings of fact, the Court makes the followingconclusions of law:
1. The long-term disability benefits received by Mr. Webber constitutea collateral source and may not be deducted from an award of back payunder the MHRA.Page 8
2. The Court is bound by the jury's determination that IP did not proveby a preponderance of the evidence that Mr. Webber should have acceptedthe offer of employment as SQA Coordinator on or after September 25,2001.
3. Mr. Webber removed himself from the labor market at the end of 2001by failing to apply for any jobs after that time, and is not entitled toan award of back pay for subsequent periods of unemployment.
4. Mr. Webber is awarded back pay for the period between July 15, 2001and December 31, 2001 in the amount of $27,384.02.
5. Reinstatement is not feasible in this case: Mr. Webber's positionhas been eliminated, there are no open positions at the mill, and thepossibility of creating a position for Mr. Webber could potentiallyrequire significant judicial oversight.
6. Mr. Webber has been more than adequately compensated for his injury,and no front pay is awarded.
7. Maine statute imposes a cap on the sum of compensatory and punitivedamages. The jury's awards of compensatory and punitive damages arereduced to $300,000 and $0, respectively.
8. Mr. Webber is not entitled to prejudgment interest on the juryaward, but is awarded prejudgment interest of 8% on the award of backpay.
A. Back Pay
As concerns the issue of back pay to which Mr. Webber is entitled, theparties have presented two main issues. First, should an award of backpay be reduced by thePage 9amount of long-term disability benefits received by Mr. Webber andattributable to premiums paid by IP? Second, did Mr. Webber adequatelymitigate his damages: (a) when he refused an offer of reinstatement atthe Bucksport mill, and (b) in his search for alternate employment?
1. Collateral Source Rule
IP argues that because it self-insures its long-term disabilitybenefits plan, IP itself paid Mr. Webber's long-term disability benefits;therefore, they do not proceed from a collateral source. IP concludesthat any award of back pay should be reduced by the amount of long-termdisability benefits received by Mr. Webber and attributable to thepremiums paid by IP. Predictably, Mr. Webber contends that the long-termdisability benefits are a collateral source and that there should be noset-off against an award of back pay.
Under the collateral source rule, "a plaintiff who has been compensatedin whole or in part for his damages by a source independent of thetortfeasor is nevertheless entitled to a full recovery against thetortfeasor."2 Potvin v. Seven Elms, Inc., 628 A.2d 115, 116(Me. 1993). "The premise underlying this rule is that either the injuredparty or the tortfeasor will receive a windfall if part of a loss is paidby an independent source, and as between the injured party and thetortfeasor, the injured party should reap the benefit of the windfall."Id. Under the Maine Human Rights Act, there is no judicialdiscretion to reduce a back pay award by amounts received from acollateral source. SeePage 10Me. Human Rights Comm'n v. Dept. of Corr., 474 A.2d 860,870 (Me. 1984); Quint v. A.E. Staley Mfg. Co., 172 F.3d 1,16-17 (1st Cir. 1999).
Whether or not a benefit provided to employees by an employer isconsidered a collateral source depends on whether it is a "fringebenefit" or whether it is provided as a means of indemnifying theemployer for injuries suffered by its employees. See Alien v. ExxonShipping Co., 639 F. Supp. 1545, 1547-48 (D. Me. 1986).Allen and its progeny set forth a five-factor inquiryon this question: (1) whether the employee makes any contribution to funding of the disability payment; (2) whether the benefit plan arises as the result of a collective bargaining activity; (3) whether the plan and payments thereunder cover both work-related and nonwork-related injuries; (4) whether payments from the plan are contingent upon length of service of the employee; and (5) whether the plan contains any specific language contemplating a set-off of benefits received under the plan against a judgment recovered in a tort action.Allen 639 F. Supp. at 1548. See also Davis v. Odeco,Inc., 18 F.3d 1237, 1244-45 (5th Cir. 1994); Phillips v. W. Co.of N. Am., 953 F.2d 923, 932-33 (5th Cir. 1992); Reed v. E.I.Du Pont de Nemours & Co., 109 F. Supp.2d 459, 467-68 (S.D.W.Va.2000); Ruberto v. Maritrans Operating Partners. L.P., 1993 WL316754 at *1 (E.D. Pa. 1993 Aug. 23, 1993).
In this case, IP seeks only to set off those portions of the long-termdisability benefits attributable to the premiums paid by it, and not theadditional premiums paid by Mr. Webber. Nevertheless, the fact that Mr.Webber had the option of contributing additional premiums for additionalcoverage weighs in favor of finding that the benefit was a collateralsource. There is no evidence in the record as to whether the benefit planarose as the result of collective bargaining activity; this factor doesnot weigh in favor of either the plaintiff or the defendant. Thelong-term disability plan covers both work-relatedPage 11and non-work-related injuries, indicating that the plan is a fringebenefit and not an indemnification plan. Payments from the planare not contingent upon the length of service of the employee; thisweighs against a determination that the plan is a fringe benefit. Thelong-term disability plan does not contain specific languagecontemplating a set-off of benefits received against a judgment renderedin favor of the employee against the employer; this also weighs in favorof a finding that the long-term disability plan was a fringe benefit.
Having considered the factors above, the Court concludes thatindemnification of the employer for liability was not a dominant purposeof the plan, and that the long-term disability policy in question isproperly considered a fringe benefit. The long-term disability benefitspaid to Mr. Webber therefore constitute a collateral source which may notbe offset against an award of back pay under the Maine Human RightsAct.3
2. Mitigation of Damages
The Maine Supreme Judicial Court has held that back pay awards aremeant to "make the employee whole and not to penalize the employer unlessthat penalty is authorized by statute." Kopenga v. Davric MaineCorp., 727 A.2d 906, 909 (Me. 1999) (internal quotation marksomitted) (quoting Rozanski v. A-P-A Transp., 512 A.2d 335, 342(Me. 1986)). A court's back pay award will be upheld absent clear erroror abuse of discretion in the amount awarded. Kopenga, 727 A.2dat 908-09. The Court may award back pay in an amount supported bycompetent evidence in the record. Id. at 909.Page 12
Back pay must be reduced by the amount that the plaintiff actuallyearned or "could be expected to earn with reasonable diligence in otheremployment." Rozanski v. A-P-A Transp., Inc., 512 A.2d at 343.The burden is on the defendant to prove facts relating to the appropriatedeductions from back pay. Me. Human Rights Comm'n v. Dept. ofCorr., 474 A.2d at 869. To show that the plaintiff was notsufficiently diligent in pursuing other employment, the defendant must domore than show that plaintiff could have taken further actions in pursuitof employment: "the range of reasonable conduct is broad and the injuredplaintiff must be given the benefit of every doubt in assessing herconduct." Me. Human Rights Comm'n v. Dept. of Corr., 474 A.2dat 869.
a. Offer of Reinstatement as SQA Coordinator
It is without dispute that IP unconditionally offered Mr. Webber aposition as SQA Coordinator at the mill on September 25, 2001 and againin early October 2001. The pay and benefits would have been identical tothose he received as a project engineer, and he would not have had towork under the same supervisors he had worked for as a project engineer.Mr. Webber testified that he got along well with the people who wouldhave been his supervisors had he accepted the SQA Coordinator position.Mr. Webber rejected the offer of re-employment twice because he thoughthe would be re-hired only to be fired again and because his feelings werehurt.
In Ford Motor Co. v. EEOC, 458 U.S. 219 (1982), a sexdiscrimination case under Title VII, the United States Supreme Court heldthat "absent special circumstances . . . the ongoing accrual of backpayliability is tolled when a Title VII claimant rejects the job heoriginally sought." Id. at 238-39. This holding is applied byextension to actions under the Maine Human Rights Act. See Doyle v.Dept. Human Servs., 824 A.2d 48, 57Page 13n.7 (Me. 2003) ("Because the MHRA generally tracks federalanti-discrimination statutes, it is appropriate to look to federalprecedent for guidance in interpreting the MHRA.") (citing Winstonv. Me. Technical Coll. Sys., 631 A.2d 70, 74-75 (Me. 1993)). Thequestion of whether "special circumstances" justify rejection of an offerof reinstatement is essentially a reasonableness test. See Wilcox v.Stratton Lumber, Inc., 921 F. Supp. 837, 843 (D. Me. 1996) (citingSmith v. World Ins. Co., 38 F.3d 1456, 1464 (8th Cir.1994)).4
With the consent of International Paper,5 the jury was askedwhether International Paper had proven by a preponderance of the evidencethat Mr. Webber "should have accepted the offer of employment as SQACoordinator on or after September 25, 2001." IP did not request juryinstructions on the legal significance of an offer of reinstatement anddid not object to the mitigation of damages instruction given to thejury.
In determining appropriate equitable relief, this Court is bound tofollow the facts as found by the jury. See Quint v. A.E. Staley Mfg.Co., 172 F.3d at 19. In light of the jury's finding on the abovequestion, the Court cannot cut off equitable relief forPage 14unreasonable refusal to accept an offer of reinstatement in lightof the jury's verdict in this case. Even if the Court is not bound by thejury's verdict, the Court declines to cut off equitable relief based onthe offer of reinstatement and its refusal.
b. Inadequate job search.
International Paper argues that Mr. Webber is not entitled to back paydamages because he did not seek alternate employment with reasonablediligence. An award of back pay should be reduced by "whatever amount[the plaintiff] could with reasonable diligence have earned" between thedate of the unlawful discrimination and the judgment. Me. HumanRights Comm'n v. City of Auburn 425 A.2d 990, 999 (Me. 1981). Thedefendant "bears the burden of proving the facts to enable the court todetermine the appropriate deduction." Id. However, where thedefendant shows that "the former employee made no effort to securesuitable employment," the defendant-employer is relieved of the "burden[of proving] the availability of substantially equivalent jobs in therelevant geographic area." Quint v. A.E. Staley Mfg. Co., 172F.3d at 16.
The evidence adduced at the evidentiary hearing indicated that Mr.Webber applied for six jobs, only three of which he could remember. Thedates of application that Mr. Webber could recall were in the autumn of2001. Because there is no evidence that Mr. Webber sought any jobs after2001, the Court concludes that Mr. Webber removed himself from the labormarket at the end of 2001, relieving International Paper of the burden ofproving the availability of substantially equivalent jobs in the relevantgeographic area beginning January 1, 2002.
As for the last half of 2001, although Mr. Webber's job search does notpresent a paragon of diligence, it is not disputed that he did make aminimal effort to obtainPage 15alternate employment. Therefore, the burden of proving failure tomitigate remains with International Paper. See Quint v. A.E. StaleyMfg. Co., 172 F.3d at 16 ("As long as the claimant has made someeffort to secure other employment, the burden to prove failure tomitigate normally resides with the defendant-employer.") Assumingarguendo that Mr. Webber's job search in 2001 did not constitutethe exercise of reasonable diligence, IP has not established any facts topermit the Court to calculate what Mr. Webber might have earned withreasonable diligence. Therefore, any reduction in back pay for thatperiod would be based on speculation and the Court need not reach thequestion of whether Mr. Webber exercised reasonable diligence in seekingalternate employment.
The Court therefore awards Mr. Webber back pay for the period betweenJuly 15, 2001, the date of his termination, and December 31, 2001.6The salary allocable to the 169-day period between July 15, 2001 andDecember 31, 2001 is $27,384.02.
B. Reinstatement and Front Pay
"[R]einstatement is the overarching preference among all equitableremedies under the ADA as it most efficiently furthers the dual goals ofproviding full coverage for the plaintiff and of deterring such conductby employers in the future." Quint v. A.E. Staley Mfg. Co., 172F.3d at 19 (internal quotations omitted). This preference and thereasoning behind it apply by extension to equitable remedies under theMHRA. See Winston v. Me. Tech. College Svs., 631 A.2d 70, 74(Me. 1993).Page 16
The question before the Court is whether IP can and should reinstateWebber to his former position. See Quint v. A.E. Staley Mfg.Co., 172 F.3d at 18. Mr. Webber has not argued that he is morequalified than the project engineers that remained in the departmentfollowing the July 2001 reduction in force, and two additional projectengineer positions were eliminated in the autumn of 2003.7 It isclear that there is no available opening for a project engineer at theBucksport mill; indeed David Libby, the human resources manager,testified that there were no open positions anywhere at the mill.Nevertheless, IP has offered to create a position for Mr. Webber, for thesame compensation as he was receiving at the time of his termination, inorder to avoid front pay liability. Under IP's proposal, Mr. Webber wouldfirst be employed doing primarily sedentary work in a project to reducestoreroom inventory, a project that is anticipated to last "for the nextcouple of years." (Evid. Hr'g Tr. at 72.) Although the nature of his workfollowing the completion of the storeroom inventory project is uncertain,IP's proposal includes creating a position that would survive theproject. Mr. Webber argues against reinstatement on the grounds that itwould be impracticable.
Because Mr. Webber's former position no longer exists, this Court hasdiscretion to refuse reinstatement. See Quint v. A.E. Staley Mfg.Co., 172 F.3d at 18. Despite the preference for reinstatement, theCourt finds that re-employment in a newly-created position with uncertainfuture prospects is an inadequate remedy for past discrimination and thatsuch a remedy would likely require significant judicial oversight wellinto the future. Therefore, the Court declines to order the proposed"reinstatement."Page 17
In a case such as this, where reinstatement is not feasible, the Courthas discretion to award a successful plaintiff front pay from the date ofjudgment forward. See Carey v. Mt. Desert Island Hosp.,156 F.3d 31, 40 (1st Cir. 1998); Wilcox v. Stratton Lumber, Inc.,921 F. Supp. 837, 844 (D. Me. 1996). "The burden falls on [the p]laintiffto prove the amount, if any, of a front pay award." Wilcox v.Stratton Lumber, 921 F. Supp. at 844.
In the exercise of its discretion, the Court finds that Mr. Webber hasbeen more than adequately compensated for his injury by the award ofcompensatory damages and back pay. Furthermore, any award of front paywould be speculative: it is unclear how long Mr. Webber would have beenable to continue working at the mill given his health difficulties, andit is unclear how long a position would have been available for him atthe Bucksport mill, which continues to experience reductions in force.
C. Statutory Cap on Compensatory Damages
The Maine Human Rights Act sets a statutory cap on the sum ofcompensatory and punitive damages awarded to a successful plaintiff.5 M.R.S.A. § 4613(2)(B)(8). The applicable cap in this case is$300,000. Id. The jury awarded Mr. Webber $1,000,000 incompensatory damages and $2,000,000 in punitive damages. The Court herebyreduces the awards of compensatory and punitive damages to $300,000 and$0, respectively, to bring the damages awarded to the statutory maximum.
D. Prejudgment Interest
Prejudgment interest is an element of compensatory damages. SeeMoholland v. Empire Fire & Marine Ins. Co., 746 A.2d 362, 364(Me. 2000). Because the jury awarded Mr. Webber compensatory and punitivedamages in excess of the statutory capPage 18and the Court has reduced the award to the maximum amount allowedby statute, Mr. Webber cannot recover any amount of prejudgment intereston the amount awarded by the jury. The Court next turns to the questionof whether prejudgment interest should be assessed on the back pay award.
In 2003, the Maine Legislature repealed the previously-existingprovision on prejudgment interest (which provided that prejudgmentinterest "shall be assessed") and enacted a new provision, providing thatprejudgment interest "is allowed." Compare 14 M.R.S.A. §1602 (2002) with 14 M.R.S.A. § 1602-B (2004). The newlegislation "applies to judgments entered on or after July 1, 2003." 2003Me. Legis. Serv. 460 (West). Section 1602-B(5) provides that "[o]npetition of the nonprevailing party and on a showing of good cause, thetrial court may order that interest awarded by this section be fully orpartially waived." Although Mr. Webber addressed the issue of prejudgmentinterest in his Proposed Findings of Fact and Conclusions of Law, IP madeno response whatsoever. As such, the Court does not reach the issue ofwhether there exists good cause not to award prejudgment interest on theback pay award because there was no petition that such interest bewaived. Prejudgment interest on the back pay award shall be calculated atan 8% rate pursuant to 14 M.R.S.A. § 1602-B(7)(A).
1. As part of a separate workers' compensation action, the partiesstipulated that in 1997, "a total of $10,695.00 per year was allocated tomill salaried employees to pay for fringe benefits." (Evid. Hr'g Pl's Ex.C.) While it is not clear whether employees were provided the samebenefits in 1997 as they were in 2001, this sum includes the value ofmedical benefits and employer 401(k) plan contributions. At the time ofhis discharge, however, Mr. Webber was not participating in the 401(k)plan, and he continued to receive medical benefits while he was receivinglong-term disability benefits.
2. Even if International Paper were to argue (it has not) that thelong-term disability benefits are not subject to the collateral sourcerule because they compensate for physical injury, not the injury sufferedas a result of the employment discrimination at issue in this case, itwould still be inappropriate to offset an award of back pay by the amountof independent income received by Mr. Webber. See Me. Human RightsComm'n v. City of Auburn, 425 A.2d 990, 999 n.8 (explaining thatincome received from a trust fund is irrelevant in determining theappropriate amount of back pay to be awarded and that "[i]t is only theamount of compensation that [the plaintiff] received or could reasonablyhave received on another job that is relevant in determining what shelost by being unlawfully barred from [the job in question]").
3. Given this ruling, the Court need not reach the other issuesargued by the parties with respect to the application of the collateralsource rule, including Mr. Webber's assertion that IP did not properlyassert a right to offset long-term disability benefits as an affirmativedefense and his argument that the benefits received are not properlyattributable to IP because the premiums were paid out of Mr. Webber'spost-tax earnings rather than his pre-tax earnings.
4. The cases are divided as to who bears the burden of proof as tothe reasonableness of an employment discrimination plaintiff's rejectionof an offer of reinstatement. Compare Smith v. World Ins. Co.,38 F.3d at 1465 ("[W]e believe the burden is correctly placed upon theemployer to prove that it made an offer of reinstatement and that theplaintiff's rejection of it was objectively unreasonable.") withBoehm v. Am. Broad. Co., 929 F.2d 482, 485 (9th Cir. 1991) ("It isonly when the employer carries this initial burden [of establishing thatthe plaintiff failed to accept an unconditional offer to a jobsubstantially equivalent to the one denied] that the plaintiff mustestablish `special circumstances' justifying a rejection of the offer.")and Miano v. AC & R Adver., Inc., 875 F. Supp. 204, 224(S.D.N.Y. 1995) ("If the employer meets its initial burden underFord Motor Company, the employee must then come forward withproof that his decision to decline reinstatement was justified; if theplaintiff can adduce such proof, he does not forfeit the right to backpay and other relief accruing after the date he rejected the offer.")However, IP has not argued that the burden of proof should be shifted toMr. Webber. Indeed, IP frames the question in its briefs as "whetherInternational Paper sustained its burden that Plaintiff failed tomitigate his back pay and front pay damages." (Def's. Mem. re: Damages at3.) In the absence of any argument on the subject, the Court does notconsider whether the burden of proof as to mitigation of damages shouldbe shifted from the defendant to the plaintiff in this circumstance.
5. IP did object to the form of the question, arguing that thequestion should have asked whether a reasonable person should haveaccepted the SQA offer, not whether Gary Webber should have accepted theoffer, but this objection does not affect the analysis at thisjuncture.
6. The 1997 fringe benefits figure provided by Plaintiff as anexhibit at the evidentiary hearing does not help the Court to determinethe value of fringe benefits that Mr. Webber was receiving at the time ofhis termination, given that he did not lose the value of medical benefitsduring the period he received long-term disability benefits and giventhat Mr. Webber was not contributing to a 401(k) account at the time ofhis termination. The Court therefore does not have an adequate basis uponwhich to calculate the value of lost fringe benefits, and declines toaward back pay damages for the value of those lost benefits.
7. In the context of cutting off back pay and front pay liability,Plaintiff argues that these positions have not yet been eliminatedbecause the individuals who occupied those positions are scheduled tocontinue working in those positions until September 2004. Regardless, thedepartment in which Mr. Webber worked at the time he was laid off hasshrunk, and there is no open project engineer position.