Ballard v. El Dorado Tire Co.

512 F.2d 901 (5th Cir. 1975)



An employee's damages in a wrongful discharge case are reduced only if the employer proves with reasonable certainty that employment was available in the specific line of work in which the employee was engaged.


Plaintiff employee filed an action to determine his rights under his employment contract with defendant employer. Plaintiff, a general manager of defendant's subsidiary, alleged wrongful discharge after defendant sold all of its stock in the subsidiary to a stockholder who desired to take over management thereof. The lower court held that defendant's sale of the subsidiary constituted a breach of contract and awarded damages to plaintiff. Defendant appealed the lower court's refusal to mitigate plaintiff's damages by what he might have earned in other employment. Plaintiff cross-appealed the lower court's holding that he was not entitled to compensation for loss of pension benefits and stock in defendant's company.


Did the defendant’s sale of a subsidiary constitute a breach of contract?




The court affirmed the judgment in part. Defendant had failed to sustain its burden of proving the existence of similar employment, a managerial position in the tire industry. The case was remanded for a determination of whether 20 percent of defendant's net profits during the contract term amounted to $ 6000, in order to decide how much of defendant's stock plaintiff would have earned under the contract. Plaintiff was not entitled to loss of pension benefits.

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