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Miga v. Jensen8/3/2000
Motion to vacate trial court's order reducing and releasing supersedeas bond denied December 29, 2000.
DENNIS L. MIGA, DEFENDENT
v.
RONALD L. JENSEN, APPELENT
Panel A: Cayce, C.J.; Livingston and Richards, JJ.
The opinion of the court was delivered by: John Cayce Chief Justice
FROM THE 48TH DISTRICT COURT OF TARRANT COUNTY
OPINION
I. INTRODUCTION
This dispute arises from Ronald Jensen's refusal to honor his employee Dennis Miga's option contract to purchase stock. Miga sued Jensen for breach of contract and fraud. The trial court disregarded the jury's fraud and punitive damages findings and awarded only contract damages. We will affirm in part, reverse and render in part, and reverse and remand in part.
II. FACTUAL BACKGROUND
Ronald Jensen is an entrepreneur and investor who made his fortune primarily in the insurance business. Dennis Miga is a business executive with experience in telecommunications.
Jensen hired Miga in 1990 to run a new long-distance telephone company called Matrix Telecom. In addition to his salary, Miga was given a 6% ownership interest in the company. Matrix Telecom sold long- distance service using the 5,000 agent field force of Jensen's insurance agency. In 1992, Matrix Telecom became a wholly owned subsidiary of Matrix Communications, and Miga's 6% interest was converted into a 4.8% interest in the new parent company.
In 1992, Miga introduced Jensen to the principals of a start-up international telephone company called Pacific Gateway Exchange ("PGE"). PGE handles international calls for other long-distance companies. In October 1992, Jensen invested in PGE, paying $850,000 for an 80% interest.
In December 1992, Jensen persuaded Sprint to route all of Matrix Telecom's international traffic through PGE. In July 1993, Jensen gave Miga an oral option to buy PGE stock. Thereafter, Miga acquired two more major clients, WilTel and Telegroup, and together with Sprint they comprised 70 to 75% of PGE's business.
On Sunday, December 4, 1994, Miga sent Jensen a fax stating he intended to resign and that he wanted to "settle his account." When he arrived at the office the next day, Jensen presented him with a termination agreement. According to Miga, Jensen said he wanted Miga gone that day and threatened to fire Miga and ruin his reputation in the telecommunications industry if Miga did not sign the termination agreement. Jensen disputes that he threatened Miga and claims that the meeting was amicable.
The termination agreement set forth Miga's severance package. However, it did not expressly address Miga's option to purchase PGE stock. Miga testified that before he signed the agreement, he told Jensen he wanted to exercise his PGE option, but Jensen refused and assured him that the agreement did not affect the option and that they would deal with the option later. Conversely, Jensen claims that the agreement contained a mutual release of all claims and rights of either party, including Miga's right to exercise the option.
During the next nine months, Miga tried to exercise the option three more times. Each time, Jensen refused, claiming that Miga had released the option.
PGE made an initial public offering approximately eighteen months after Miga resigned. Before the offering, PGE's stock split 940 to 1. It initially sold for $12 per share, reached a high of $45.75 per share, and was worth $35.75 per share at the time of trial.
Miga sued to recover for Jensen's refusal
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