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in Massachusetts seeking personal injury damages for damaged
reputation and emotional distress caused by Millipore’s conduct in
terminating petitioner’s employment. Moreover, we believe Millipore
recognized that petitioner’s termination gave rise to potential
causes of action under French law for termination without cause (a
tort, in nature) as well as a potential recovery under the
collective bargaining agreement covering managers and engineers.
Personal Injuries or Sickness
To prevail, petitioners must also prove that the proceeds
received from Millipore were on account of personal injuries or
sickness. Personal injury includes both tangible and intangible
harms. See Commissioner v. Schleier, 515 U.S. at 330 n.4. These
harms include pain and suffering, emotional distress, and harm to
reputation or other consequential damages, such as embarrassment,
humiliation, and mental anguish. See United States v. Burke, 504
U.S. at 239; Knevelbaard v. Commissioner, T.C. Memo. 1997-330.
On the basis of the documentary evidence and credible testimony
in this case, we conclude that petitioner suffered serious and
prolonged emotional and physical injury arising from Millipore’s
termination. The abrupt manner in which Millipore terminated
petitioner dramatically affected him, resulting in the decline of
his physical and emotional well-being. He suffered emotional
distress (embarrassment, humiliation, and mental anguish) manifested
by both mental and physical symptoms, as well as harm to his
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