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with a lawsuit to be filed against the Company relating to
petitioner’s termination.
On January 21, 1999, petitioner’s lawsuit was filed against
the Company in the Superior Court of the State of California,
seeking compensatory damages for wrongful termination, for
discrimination, and for intentional infliction of emotional
distress and seeking punitive damages.
On December 27, 2000, after binding arbitration in the
lawsuit, $756,392 in damages was awarded to petitioner,
consisting of $284,367 for backpay, $322,025 for frontpay, and
$150,000 for emotional distress. Petitioner was not awarded
punitive damages.
On March 15, 2001, petitioner and the Company agreed that
the Company would pay petitioner the $756,392 arbitration award
in installments over a period of 3 years.
During 2001, the Company, as installment payments on the
damage award, issued checks in favor of petitioner in the total
amount of $148,744 and mailed the checks to petitioner’s
attorney. After subtracting therefrom $59,498 for legal fees, in
2001 petitioner’s attorney transferred to petitioner a net of
$89,246.
In early 2002, on a 2001 Form 1099-MISC, Miscellaneous
Income, the Company reported to petitioner and to respondent that
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Last modified: May 25, 2011