Michael R. and Shelley F. Fawcett - Page 10




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          was intended by the parties to be for a different purpose.  See             
          Bagley v. Commissioner, supra at 406; Robinson v. Commissioner,             
          102 T.C. 116, 127 (1994), affd. in part, revd. in part, and                 
          remanded on other grounds 70 F.3d 34 (5th Cir. 1995).                       
               Petitioners rely on section 8 of the Settlement Agreement              
          that “All Settlement Proceeds are paid to Plaintiffs on account             
          of personal injuries.”  However, the record clearly shows that              
          the complaint in the class action was exclusively for the                   
          recovery of “overtime compensation, liquidated damages,                     
          attorney’s fees and costs” under the FLSA.  In Jacobs v.                    
          Commissioner, supra, this Court held that recoveries for claims             
          based on the FLSA are not excludable from gross income because              
          FLSA does not provide for personal injury compensation.  The FLSA           
          was enacted to establish minimum wages and maximum hours for                
          employees.  See Brooklyn Sav. Bank v. O’Neil, 324 U.S. 697, 707             
          (1945).  The only relief available under the FLSA for excessive             
          hours worked is the payment of back wages and payment of                    
          liquidated damages.  See FLSA 29 U.S.C. sec. 216(b) (1994).                 
          Liquidated damages are intended to compensate the employee for              
          damages “too obscure or difficult to estimate caused by the delay           
          of late payment.”  Jacobs v. Commissioner, supra; see also                  
          Overnight Motor Transp. Co. v. Missel, 316 U.S. 572, 583-584                
          (1942).  Also, we note petitioner’s own testimony during trial              








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