Quick Summary
Twentieth Century Fox-Film Corporation (D) hired Parker (P) to play the female lead in their movie “Bloomer Girl.” After the agreement, the company decided not to produce the film and offered another leading role for a different movie. Plaintiff declined the offer and sued the defendant to recover the guaranteed compensation. The trial court ruled in favor of parker and granted summary judgment. Fox appealed the grant of summary judgment to the Supreme Court of California.
The Supreme Court upheld the trial court verdict and ruled in favor of Parker (P). Accordingly, the plaintiff’s refusal of the substitute offer could not be used to mitigate damages because the substitute offer was both distinct and inferior.
Rule of Law
Damages for wrongful termination are based on the employee’s agreed-upon salary for the duration of service. In order to mitigate damages, the employee’s refusal to accept or failure to seek other available employment of a different or inferior nature cannot be used.
Facts of the Case
Twentieth Century Fox-Film Corporation (Plaintiff) hired Parker (Defendant) to play the female lead in their movie “Bloomer Girl.” The parties entered a contract in which Twentieth Century Fox would pay Parker a minimum compensation of $750,000 over 14 weeks for acting in the film.
The company decided not to produce the film, and instead offered plaintiff the leading role in another movie titled “Big Country, Big Man.” Unlike “Bloomer Girl,” which was to be a musical held to be filmed in California, “Big Country, Big Man” was a dramatic western film in Australia. Plaintiff declined the offer and sued the defendant to recover the guaranteed compensation under their original contract.
The trial court ruled in favor of parker (actress) and granted summary judgment. Fox appealed the grant of summary judgment to the Supreme Court of California.
Issue
Is the plaintiff entitled to the originally agreed payment as a result of wrongful termination, even after rejecting the defendant’s alternative employment offer?
Holding and Conclusion
Yes.
The Supreme Court of California ruled in favor of Parker and upheld the previous summary judgment. The fact that the employee rejected a lower-paying position is irrelevant. Thus, the plaintiff’s unwillingness to take the role in “Big Country, Big Man” will not affect her ability to recover her originally agreed on payment.
The court held that before using predicted earnings from other offers not sought or taken to mitigate damages, the employer must establish that the additional work was equal or substantially similar to that of which the employee was fired by wrongful termination.
Reasoning and Analysis
The court reasoned that the plaintiff refusal to accept the defendant’s offer of alternative work in the “western” could not be used to mitigate damages since the offer was of a distinct and inferior profession to a musical revue requiring the plaintiff’s abilities as a dancer and actor. Moreover, the substitute offer proposed to eliminate or impair the director and screenplay approvals according to the plaintiff under the original contingency plan.
The substitute offer did not allow the plaintiff to approve the director or screenplay, making it an inferior offer.
An unjustly terminated worker’s decision to reject or forego alternative or lower-paying employment for fear of having the potential earnings used against him to reduce damages is not subject to reasonableness analysis.
The trial court correctly decided that plaintiff’s refusal of the substitute offer could not be used to mitigate damages because the substitute offer was both distinct and inferior.
Relevant FAQs of this case
What is the employee's duty to mitigate damages after a wrongful termination?
After an employee’s termination, they may be entitled to recover damages if the termination violated the contract. However, the employee’s recovery is subject to certain requirements regarding mitigating damages.
The most important factor for recovering damages after a wrongful termination is that the employee mitigates their damages by attempting to secure employment similar to their previous job, which is often referred to as “active” mitigation. A court will typically require proof that the employee made “reasonable efforts” to find new employment. “Reasonable efforts” can be demonstrated by evidence that the employee sent out resumes, contacted former employers and colleagues, and conducted interviews.
References
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