Court Opinion

ID: 9549768
Source: CourtListenerOpinion
Date Created: 2023-08-07 18:24:34.489785+00
Date Added: 2024-06-11T15:20:53.578040
License: Public Domain

Justice MULLARKEY
dissenting:
I respectfully dissent from the majority’s conclusion that Patricia Fair (Fair) failed to present sufficient evidence to allow the jury to determine whether her rejection of Red Lion Inn’s (Red Lion) offer of re-employment was reasonable. Despite the majority’s assertions to the contrary, its decision in this case fails to correctly apply a “directed verdict” or “judgment notwithstanding the verdict” standard of review which requires us to view the facts, and the inferences that can be legitimately drawn from those facts, in the light most favorable to Fair. Correctly applying that standard, I find that the evidence produced at trial was sufficient to support a verdict by a reasonable jury in Fair’s favor.
I also disagree with the majority’s interpretation and application of Giandonato v. Sybron Corp., 804 F.2d 120 (10th Cir.1986). The rationale articulated in Giandonato that employees are required to request clarification of the terms of ambiguous offers does not mandate the majority’s result under the specific facts of this case. Therefore, I dissent.
I.
While we have recognized the general duty of an injured party to mitigate damages, we *443have not before applied this doctrine to employment agreements. See maj. op. at 439. We therefore granted certiorari in this case to determine whether an employee’s rejection of her former employer’s offer of reemployment constitutes a failure to mitigate damages as a matter of law.
The United States Supreme Court has held in the context of Title VII employment discrimination cases that, absent special circumstances, a claimant forfeits her right to back pay if she refuses an offer of employment that is substantially equivalent to the one she was denied. See Ford Motor Co. v. EEOC, 458 U.S. 219, 238-39, 102 S.Ct. 3057, 3069-70, 73 L.Ed.2d 721 (1982). An offer for employment is considered substantially equivalent if it affords “virtually identical promotional opportunities, compensation, job responsibilities, working conditions, and status as the position from which the ... claimant [was] terminated.” Sellers v. Delgado Community College, 839 F.2d 1132, 1138 (5th Cir.1988).
As the majority notes, many federal circuits have held that, in cases where the former employer offers a terminated employee re-employment, a reasonable rejection of an offer for re-employment is considered a special circumstance under Ford. See Smith v. World Ins. Co., 38 F.3d 1456, 1464 (8th Cir.1994); Toledo v. Nobel-Sysco, Inc., 892 F.2d 1481, 1493 (10th Cir.1989); Graefenhain v. Pabst Brewing Co., 870 F.2d 1198, 1203 (7th Cir.1989); O’Donnell v. Georgia Osteopathic Hosp., Inc., 748 F.2d 1543, 1550 (11th Cir.1984). Thus, an employee who rejects an unconditional offer for re-employment by her former employer is not precluded from receiving an award for lost back pay compensation after the time of the offer for reinstatement if her rejection was reasonable.14
At trial, Red Lion argued in motions for a directed verdict and for judgment notwithstanding the verdict that Fair was not entitled to back wages as a matter of law because she rejected Red Lion’s unconditional offer of re-employment. The trial court denied Red Lion’s motions and, consistent with Ford and its progeny, instructed the jury that Fair had “the duty to take such reasonable steps as are reasonable under the circumstances to mitigate or minimize ... damages.” The jury was also instructed that Fair was precluded from recovering damages for back pay and benefits after the time Red Lion offered her reinstatement if Red Lion proved by a preponderance of the evidence:
1. That it made an offer to reinstate Ms. Fair to her former position or to a position comparable in pay, benefits, and responsibilities; and
2. That Ms. Fair unreasonably rejected the reinstatement offer.
After considering the evidence, the jury rejected Red Lion’s affirmative defense and awarded Fair full damages for back pay and benefits.
Red Lion now renews its argument that Fair’s rejection of the offer for re-employment was unreasonable as a matter of law. Therefore this court must apply the same standard of review utilized by the trial court on a motion for a directed verdict or a judgment notwithstanding the verdict. Under that standard, we must view the evidence in the light most favorable to the non-moving party, i.e. Fair, and must draw every reasonable inference which can legitimately be drawn from the evidence in favor of that party. See Nelson v. Hammon, 802 P.2d 452, 454 (Colo.1990). A judgment as a matter of law for Red Lion is appropriate only if the evidence, and the legitimate inferences drawn from the evidence, viewed in the light most favorable to Fair, would not support a verdict by a reasonable jury that Fair’s rejection of Red Lion’s offer for re-employment was reasonable. See id. In my view, the majority decision incorrectly applies this standard in concluding that this case should not have been submitted to the jury and Fair’s rejection of Red Lion’s offer for reinstatement was unreasonable as a matter of law.
*444II.
The majority acknowledges the following three reasons asserted by Fair for her rejection of the reinstatement offer: “(1) she believed that she would be terminated again as a form of retaliation; (2) she was concerned about her physical condition due to her pregnancy; and (3) she was uncertain of the meaning of the terms ‘appropriate benefits’ in the Reinstatement Offer.” Maj. op. at 440. However, because the majority incorrectly finds that “Fair did not produce evidence sufficient to articulate a basis for her belief and concerns based upon the specific terms and conditions of the offer or identifiable conduct of Red Lion,” it concludes that “the reasons proffered by Fair are insufficient as a matter of law to create a triable issue for the jury’s consideration.” Id. Based on my reading of the record, I do not agree. Applying the appropriate standard for a judgment notwithstanding the verdict, Fair’s second and third reasons for rejecting Red Lion’s reinstatement offer clearly present issues of fact for the jury regarding the reasonableness of her rejection.
A.
The evidence adduced at trial shows that Neil Gustafson (Gustafson), the Director of Human Resources, and Ron Barr (Barr), Fair’s immediate supervisor, knew that Fair was pregnant before they told her that she was terminated. Fair testified that she informed them of this fact between the time she gave Red Lion her initial restricted medical release and the time she supplied her full medical release. In asking for an extension to June 27 for filing a full release, she told Barr that if her obstetrician, Dr. Walker, allowed it, her regular physician, Dr. Hart, would be able to give her a full release. She personally took Dr. Hart’s release, which stated that she could return to work on July 2, to Gustafson on June 27 and asked him if he needed a release from Dr. Walker as well. Gustafson responded that he did not need a release from her obstetrician and that he would confer with Barr about her return and get back to her. After July 2 came and went without her hearing from Barr or Gustafson, Fair made several calls to Barr, who repeatedly indicated that he was trying to meet with Gustafson. Finally, on July 9, Fair called Barr again and was told that she had been terminated. Barr told her to speak to Gustafson about the termination.
Fair went to Dr. Walker on July 10 to obtain a release because she was concerned that Barr and Gustafson had not considered her release to be full without information from the obstetrician. After obtaining the release, she took it to Gustafson later that same day. In that meeting Gustafson told Fair that she had been released because Red Lion could no longer hold her position open. However, Gustafson took both releases from Dr. Walker and Dr. Hart and indicated that he would talk to some people about her employment. The release from the obstetrician, Dr. Walker, dated July 10, 1990, was admitted into evidence at trial. Thus, the record shows that Red Lion knew that Fair was three months pregnant when it terminated her. Drawing all inferences in Fair’s favor, we must assume that Red Lion knew she was five to six months pregnant at the time it made the reinstatement offer in September.
The majority states that “on cross-examination, Fair testified that she had no physical restrictions at the time she refused the Reinstatement Offer.” Id. at-. The majority appears to draw this conclusion from the following testimony:
Q: There is no comment in [the letter requesting conditions of re-employment] that you are not able to perform any particular job function, is there?
A: There wasn’t a problem.
Q: And there is no comment in that letter that you are not — that you have any physical restrictions, is there?
A: I had no physical restrictions at that time.
Q: And that would have been on October 1,1990, correct?
A: Other than my pregnancy.
Q: Okay, but you were physically able to perform your job?
A: I was able to go back to work.
Q: And my question is, there was no reason physically that you were unable to work, true?
*445A: No, there was not.
Q: Okay. Is that a true statement?
A: True. Under those provisions I could go back to work.
Viewing the testimony in the light most favorable to Fair and drawing all reasonable inferences in her favor, the evidence shows that she had no physical restrictions at that time “other than her pregnancy” and that she could go back to work under the provisions of the request for re-employment she made to Red Lion. In addition, Gustafson testified on cross-examination that he would have a concern about someone six to seven months pregnant lifting a very large coffee table. Thus, contrary to the majority’s conclusion, the evidence demonstrates that Fair’s pregnancy was a condition affecting her employment of which Red Lion was aware at the time it made the reinstatement offer.
The majority also emphasizes that “Fair failed to communicate any concern regarding physical limitations in her letter requesting special conditions.” Id. However, as the evidence discussed above shows, she had every reason to believe that Red Lion was fully aware of her pregnancy. The majority concludes, nonetheless, that “while we do not exclude physical limitations per se as a reasonable basis to reject a reinstatement offer, in this case we are not persuaded that it was sufficiently presented to evince a reasonable basis to reject the Reinstatement Offer.” Id.
In essence, the majority holds that any rejection of a reinstatement offer is per se unreasonable if an employee does not directly and explicitly communicate her reasons for rejection at the time the offer of reinstatement is made. In this case, Fair informed Red Lion of her pregnancy three months before the reinstatement offer was made. In addition, although she did not specifically mention her pregnancy at the time of the offer, she did respond to Red Lion’s initial reinstatement offer with a specific request that certain conditions be met to accommodate her pregnancy.
Drawing all inferences in her favor, a reasonable juror could find that Fair’s concern regarding her pregnancy was a reasonable basis for rejecting the offer. I disagree with the majority’s conclusion in this case that she did not meet her burden. In addition, as I discuss in part III below, I cannot join in the majority’s decision, which holds, in effect, that an employee must always present her reasons for rejection to the employer at the time the reinstatement offer is made. This result unjustifiably prevents the trier of fact from considering all of the facts and circumstances relevant to the determination of the reasonableness of the employee’s rejection.
B.
The majority also improperly applies the standard for a judgment notwithstanding the verdict to Fair’s third and final stated reason for rejection. In contrast to the majority’s conclusion, my review of the evidence shows that Fair did not “without further inquiry of Red Lion or communication of her concerns, reject[ ] the offer out of hand.” Maj. op. at -. The record establishes that Fair was extremely concerned about medical benefits coverage due to her pregnancy, and that Red Lion was aware that she was pregnant.15 Red Lion made an admittedly vague initial offer of reinstatement in a September 20, 1990, letter, stating that “we offer Ms. Fair the opportunity to return to her position in Room Service at the Red Lion Hotel, Colorado Springs.”16 In response to that offer, *446Fair made specific requests for her reinstatement which included the explicit condition that “all her employee benefits must be restored without penalty for their interruption.” (Emphasis added.). In Red Lion’s letter in response to Fair’s concerns, however, Red Lion stated only that its offer included “restoration of the appropriate benefits with coverage bridged as [she] would maintain her original hire date.” (Emphasis added.).
Because she was worried about the meaning of “appropriate,” Fair took the affirmative step of calling the insurance company directly to determine if Red Lion could honor its offer. She was informed that the insurance company, not Red Lion, had the ultimate authority to determine who was covered. There is no indication that this information was incorrect, i.e. that the insurance company would be the final decision-maker as to whether Fair was covered. Red Lion apparently had not contacted its insurance company about re-employing Fair and the insurability questions raised by Fair’s intervening pregnancy and the fact that she had had to enroll in Medicaid for health care coverage after she was fired. Gustafson testified that he did not check with the insurance company himself about coverage until one week after his deposition and two weeks before trial. Moreover, Gustafson testified that he did not know that under the HMO plan offered by Red Lion’s insurance company, continuation of coverage was not available for someone on Medicaid. In fact, viewing the testimony and drawing inferences in favor of Fair, none of Red Lion’s witnesses knew at the time the reinstatement offer was made whether or not the insurance company would bridge benefits for Fair.
Thus, the facts show: that Red Lion’s initial offer was vague; that Fair responded with specific requests, including asking for “all benefits” to be bridged; that Red Lion did not offer her “all” benefits in response but proposed “appropriate” benefits instead; that Fair took the affirmative step of calling the insurance company and was told that Red Lion did not have the authority to guarantee insurance coverage; and that Red Lion did not know at the time of the offer if the insurance company would bridge her benefits. These facts are sufficient to create a triable issue for the jury as to whether Fair’s reason for rejection of the offer was reasonable.
In the end, however, the majority finds that, even if the insurance company would not have bridged Fair’s benefits, her concern about insurance was not reasonable as a matter of law, because “[i]f the carrier did not provide coverage, Fair would be covered because Red Lion would still be bound, even if forced to incur additional expenses for her coverage.” Id. In support of its rationale, the majority highlights Fair’s testimony at trial that she assumed Red Lion could bridge coverage if Red Lion was willing to pay for it. However, whether Fair might have believed that Red Lion could have bridged her benefits if it paid is distinguishable from her concern as to whether Red Lion, in fact, would have done so.
For purposes of argument, I will assume that the majority is correct that Red Lion would have had to bear any and all costs necessary to provide insurance coverage for Fair and her child, although the correctness of the majority’s proposition seems highly questionable. The majority’s conclusion, however, relies on the assumption that Fair, a five-dollar-per-hour hotel service worker who was forced to go on Medicaid after she was terminated from her job, could not have been reasonably concerned about her health insurance coverage. The majority believes Fair should have known that the statement made by Red Lion in its second reinstatement offer would be legally binding upon it and should have trusted Red Lion despite information she had received from the insurance company that Red Lion’s policy might not cover her. In my view, the majority’s assumptions are entirely unrealistic and require a level of legal knowledge and sophistication which exceeds that of many lawyers.
*447Furthermore, Red Lion’s use of the word “appropriate” benefits in response to Fair’s request for “all” benefits still raises a question as to exactly what benefits Red Lion would have been legally obligated to provide. In my opinion, a reasonable person in Fair’s position would not have known what medical benefits Red Lion intended to provide to her and would have been unwilling to surrender her Medicaid coverage on the hope that Red Lion would pick up full coverage. Therefore, I disagree with the majority that a reasonable juror could not find that Fair’s concern about insurance coverage was a reasonable basis for rejecting Red Lion’s offer.
III.
As noted above, the majority appears to hold that any rejection of a reinstatement offer is per se unreasonable if an employee does not directly and explicitly communicate her reasons for rejection at the time the offer of reinstatement is made. In reaching this result, the majority relies heavily on the reasoning of Giandonato v. Sybron Corp., 804 F.2d 120 (10th Cir.1986), where the Tenth Circuit held that an employee’s reasons for rejecting an employer’s reinstatement offers were not sufficient to create an issue for the jury. 804 F.2d at 123. In Giandonato, the employee successfully argued that he was constructively discharged as a result of age discrimination. Similar to the case presented here, the employer in Giandonato argued that the employee should be precluded from receiving an award for back pay and lost wages compensation because the employee failed to mitigate his damages by rejecting several offers for reemployment.17 See id. at 122.
The employee in Giandonato asserted three reasons for his rejection of the employer’s offers of reinstatement. He indicated that “he did not want to work under [his previous supervisor’s] supervision, he had uncertainties about [the employer’s] offers, and his wife was terminally ill with cancer.” Giandonato, 804 F.2d at 122. Purportedly applying the special circumstances test articulated in Ford, the Tenth Circuit concluded that the employee’s refusal to return to work for personal reasons, i.e., because his wife was ill and because he did not want to work under his previous supervisor, were not valid. See id. at 124. With regard to the employee’s argument that he rejected the offers because they were uncertain, the Tenth Circuit observed that he failed to request any clarification of the offers from the employer. See id. at 125. The court also concluded that the record failed to establish that the offers “were anything other than bona fide unconditional offers of reinstatement.” Id. Therefore, the Tenth Circuit held that the employee’s rejection of the reinstatement offers “eliminated any viable claim he may otherwise have had for back pay and reinstatement.” Id.
As noted in Part II, the facts of this case are clearly distinguishable from those of Giandonato. Unlike the employee in Gian-donato, Fair addressed her uncertainties with Red Lion’s reinstatement offer in two ways. First, Fair responded to Red Lion’s initially vague offer by making specific requests with regard to the conditions of her reinstatement. In particular, Fair requested that “all her employee benefits must be restored without penalty for their interruption.” (Emphasis added.). Second, after Red Lion failed in its second offer to adequately clarify the terms of the benefit package, Fair contacted Red Lion’s insurance company directly to determine Red Lion’s ability to bridge benefits. Thus, the majority’s reliance on the Tenth Circuit’s reasoning in Giandonato is misplaced because Fair *448took affirmative steps to address the uncertainties of Red Lion’s offers.18
My conclusion that the Tenth Circuit’s reasoning is controlled by the specific facts of Giandonato finds support in Graefenhain v. Pabst Brewing Co., 870 F.2d 1198 (7th Cir.1989). In Graefenhain, the Seventh Circuit explained that “[t]he accrual of damages ... is not terminated merely because the employee refuses an offer of reinstatement; instead, it is only ‘an unreasonable refusal ... [which] will preclude recovery of front pay.’ ” 870 F.2d at 1203 (quoting McNeil v. Economics Laboratory, Inc., 800 F.2d 111, 118 (7th Cir.1986)). Distinguishing its facts from those of Giandonato, the Graefenhain court stated that, “[o]nly after receiving an appropriately detailed offer is [a] discharged employee required either to accept the offer or to provide specific reasons why it is inadequate.” Graefenhain, 870 F.2d at 1203. Thus, Graefenhain highlights the fact that Giandonato does not establish a per se rule requiring an employee to clarify ambiguous terms in an employer’s offer of reinstatement. More importantly, however, the reasoning of Giandonato does not mandate the result reached by the majority in this case because the facts of the two cases are clearly distinguishable.
IV.
In conclusion, the majority’s decision fails to properly consider the facts, and the inferences to be drawn from those facts, in the light most favorable to Fair. Viewed in the proper light, I find that Fair presented sufficient evidence to satisfy her burden such that a reasonable juror could conclude that her rejection of Red Lion’s offer of re-employment was reasonable. I also disagree with the majority’s application of Giandonato to the specific facts of this case. Unlike the employee in Giandonato, Fair took affirmative steps to clarify the ambiguity in Red Lion’s reinstatement offer concerning the medical benefits that would be provided upon her re-employment. Accordingly, I dissent.
I am authorized to say that Justice HOBBS and Justice BENDER join in this dissent.

. This court did not grant certiorari on the issue of whether Red Lion’s offer was unconditional. The majority assumes for purposes of its opinion, without deciding, that the offer was unconditional. I make the same assumption.

. I note that Fair’s concern about medical coverage seems entirely reasonable in hindsight given that Fair gave birth to a child with severe medical complications, including a heart murmur requiring surgery and an eventual liver transplant which has resulted in long-term medical care and frequent hospitalization for the child.

. On direct examination, Gustafson testified to the following:
A: [reading the second paragraph of Fair's letter responding to Red Lion’s initial offer on September 20] “Two. All her employee benefits must be restored without penalty for their interruption.”
Q: What is different from what you have offered previously when you offered to reinstate her employment? Were you specific in the first letter?
A: No, we were not, but, again, if we were going to reinstate someone, that would go along with it.
*446Thus, Gustafson acknowledged that Red Lion's first reinstatement offer was not specific or detailed.

. The Tenth Circuit noted that the employer made numerous written and verbal offers for reemployment. First, approximately one month after the employee filed his discrimination claim with the EEOC, the employer orally related to the EEOC investigator that the employee could "return to active employment on a probationary status for six months with no loss of service credit.” Giandonato, 804 F.2d at 125. The verbal offer for reinstatement was reiterated one week later in a letter to the EEOC investigator. See id. One month later, the employer made another verbal offer for reemployment during a meeting with the EEOC investigator and the employee. See id. The third offer was confirmed by a letter two days later. See id. The employer made its final offer for reinstatement one week later in another letter to the EEOC investigator. See id. The employee did not respond to any of these offers for reinstatement.

. In addition, the cases are distinguishable because the offers made by the employer in Gian-donato became progressively more detailed and ultimately contained terms and conditions of employment superior to those that the employee enjoyed before his constructive discharge. In contrast, both of Red Lion's offers of re-employment were arguably vague and failed to address Fair’s specific requests for a desk position with "all benefits.”