110 F.3d 73 (10th Cir. 1997), 96-8032, Anderson v. Exxon Coal U.S.A., Inc.

Docket Nº:96-8032.
Citation:110 F.3d 73
Party Name:Tobey ANDERSON, Plaintiff--Appellee,
Case Date:April 04, 1997
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

Page 73

110 F.3d 73 (10th Cir. 1997)

Tobey ANDERSON, Plaintiff--Appellee,

No. 96-8032.

United States Court of Appeals, Tenth Circuit

April 4, 1997

Editorial Note:

This opinion appears in the Federal reporter in a table titled "Table of Decisions Without Reported Opinions". (See FI CTA10 Rule 36.3 regarding use of unpublished opinions)

97 CJ C.A.R. 497

Before ANDERSON, McWILLIAMS, and BRISCOE, Circuit Judges.


Appellant, Exxon Coal U.S.A., Inc. (Exxon), terminated the employment of appellee Tobey Anderson, following a positive drug test. Ms. Anderson then brought this diversity suit against Exxon, alleging six causes of action under Wyoming law: (1) breach of an implied employment contract; (2) promissory estoppel; (3) breach of the implied obligation of good faith and fair dealing; (4) negligence; (5) invasion of privacy; and (6) intentional infliction of emotional distress. The district court granted Exxon's motion for summary judgment on the negligence and intentional infliction of emotional distress claims. The remaining claims were tried to a jury. At the close of plaintiff's evidence, the district court granted Exxon's motion for judgment as a matter of law with respect to Ms. Anderson's invasion of privacy and breach of good faith and fair dealing claims. Ms. Anderson's breach of contract and promissory estoppel claims went to the jury, which found that Exxon breached an implied in fact contract with Ms. Anderson, and awarded her $416,800 in damages. Exxon filed a renewed motion for judgment as a matter of law, or in the alternative for a new trial or remittur. See Fed.R.Civ.P. 50(b). The district court denied the motion, and this appeal followed.

Exxon alleges that it was entitled to judgment as a matter of law on the issues submitted to the jury because, under Wyoming law, the employee handbook upon which Ms. Anderson relied at trial did not create an implied contract of employment, and, even if it did, Exxon did not breach that contract when it fired Ms. Anderson for drug use. In the alternative, Exxon argues that it is entitled to a new trial. We hold that the implied contract issue properly presented a jury question, but we agree with Exxon that Ms. Anderson's termination for a positive drug test did not breach any contract with her. Accordingly, we reverse the judgment.


Appellant Exxon Coal, U.S.A. is a wholly-owned subsidiary of Exxon Corporation. During the period relevant to this case, Exxon owned two mines near Gillette, Wyoming, operating them through an unincorporated division known as the Carter Mining Company. 1 Tobey Anderson worked for Exxon from December 30, 1977 until her termination on July 2, 1993. She worked most recently in a warehouse at one of the mines as a "Materials Handler Grade 4," receiving promotions and largely positive evaluations of her work performance.

Exxon provided its employees, including Ms. Anderson, with the "The Carter Mining Employee Handbook," see R. Supp. Vol. I at tab 157-1, which was "intended to provide all employees, unless otherwise noted, with some information and guidelines on our general rules and policies for the purpose of encouraging a better work place." Appellant's App. Vol. I at 65. The handbook includes a table of contents, introduction, summary and index, and is divided into seventeen sections in bold-face type, some of which include subsections set off in bold-face, italicized type. The "Individual Recognition" section includes a subsection entitled, "The Carter Mining Company's Philosophy Regarding Unions," and refers to job security. Id. at 70-72. A section entitled, "Your Responsibilities" includes separate subsections for Carter Mining's discipline system and its drug policy. Under the "Positive Discipline" subsection, the handbook lists twenty-one rules of conduct, and explains that the "following list, although not all-inclusive, is illustrative of the kinds of violations which may result in disciplinary action or termination." Appellant's App. Vol. I at 86.

In the "Rules of Conduct" subsection, the handbook lists rules, the violation of which "may result in disciplinary action or termination," including: "Misuse of legitimate drugs or the use, possession, or sale of unprescribed controlled drugs on Company time or property; Possession, use, distribution, or sale of alcoholic beverages on Company property; [and] Reporting to work in an unfit condition." Id. at 86-87 (emphasis added).

The handbook also contains a separate subsection entitled "Policy Statement on Employee Alcohol and Drug Use," which provides in relevant part:

The Carter Mining Company is committed to a safe, healthy, and productive work place for all employees. The Company recognizes that alcohol, drug, or other substance abuse by employees will impair their ability to perform properly and will have serious adverse effects on the safety, efficiency, and productivity of other employees and the Company as a whole. The misuse of legitimate drugs or the use, possession, distribution, or sale of illicit or unprescribed controlled drugs on Company business or premises is strictly prohibited and is grounds for termination. Possession, use, distribution, or sale of alcoholic beverages on Company premises is not allowed. Being unfit for work because of use of drugs or alcohol is strictly prohibited and is grounds for termination of employment. While this policy refers specifically to alcohol and drugs, it is intended to apply to all forms of substance abuse.

The Company recognizes alcohol or drug dependency as a treatable condition. Employees who suspect they have an alcohol or drug dependency are encouraged to seek advice and to follow appropriate treatment before it results in job performance problems....

No employee with alcohol or drug dependency will be terminated due to a request for help in overcoming that dependency or because of involvement in a rehabilitation effort. However, an employee who has had or is found to have a substance abuse problem will not be permitted to work in designated positions identified by Management as being critical to the safety and well-being of employees, the public or the Company. Any employee returning from rehabilitation will be required to participate in a Company-approved after-care program. If an employee violates provisions of the Employee Alcohol and Drug Use Policy, appropriate disciplinary action will be taken. Such action cannot be avoided by a request at that time for treatment or rehabilitation. If an employee suffering from alcohol or drug dependency refuses rehabilitation or fails to respond to treatment or fails to meet satisfactory standards of effective work performance, appropriate disciplinary action, up to and including termination, will be taken. This policy does not require and should not result in any special regulations, privileges, or exemptions from normal job performance requirements.

The Carter Mining Company may from time to time conduct unannounced searches for drugs and alcohol on owned or controlled property. The Company may also require employees to submit to medical evaluation or alcohol and drug testing where cause exists to suspect alcohol or drug use. Unannounced periodic or random testing will be conducted when an employee meets any one of the following conditions: has had a substance abuse problem or is working in a designated position identified by Management, a position where testing is required by law, or a specified executive position. A positive test result or refusal to submit to a drug or alcohol test is grounds for disciplinary action, including dismissal.

Id. at 90-92 (emphasis added).

In September 1989, following the Exxon Valdez disaster, Exxon adopted the foregoing drug and alcohol policy which was in effect at the time of Ms. Anderson's termination. Exxon distributed the policy to all employees, it held training seminars concerning the new policy for all employees, and it incorporated the new policy in the January 1990 update of the employee handbook. R. Vol. VIII at 190-192, 197-98. Ms. Anderson testified that she read, understood, and relied on various portions of the employee handbook prior to her termination, including the handbook's alcohol and drug policy...

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