DRAFTING SETTLEMENT AGREEMENTS IN LITIGATION First Run Broadcast: April 21, 2015 Live Replay: July 9, 2015 1:00 p.m. E.T./12:00 p.m. C.T./11:00 a.m. M.T./10:00 a.m. P.T. (60 minutes) A settlement in litigation commercial, fiduciary, construction, or other is only as good as the settlement agreement. The case may have stopped short of trial or stopped in the middle of trial as the parties realized that settlement was the best course of action, but preserving the informal agreement to settle places immense pressure on getting the underlying agreement right not only settling the present dispute but preserving the settlement as things change over time. Understanding the law governing these agreements and carefully drafting their essential provisions mutual releases, scope, any financial terms, non-disclosure, non-disparagement an many more are essential to preserving the value of the settlement. This program will provide you with a draftsman s guide to the essential provisions, traps and opportunities of litigation settlement agreements. Framework of law governing settlement agreements Essential provisions of settlement agreements, including traps for the unwary Defining scope of settlement and mutual releases either to prevent resumption of litigation or leave related litigation untouched Economic terms (including potential tax impact), uses of escrow, and collection Role of non-disclosure and non-disparagement provisions, violations and remedies. Enhancing the enforceability and decreasing the costs of settlement agreements Speaker: Steven B. Malech is partner in the New York City office of Wiggin and Dana, LLP, where he is chair of the firm s probate litigation practice group. He is represents beneficiaries, fiduciaries and creditors in disputes involving alleged violations of the Prudent Investor Act and its predecessors, alleged breaches of fiduciary duty, disputed accountings, and will contests. He represents clients in cutting edge probate litigation matters involving trusts and estates with assets in the hundreds of millions of dollars. Mr. Malech received his B.A., with special honors, from the University of Texas and his J.D. from the Connecticut School of Law. Kevin S. Budge is a partner in the New Haven, Connecticut office of Wiggin and Dana, LLP, where he specializes in the defense of healthcare providers in alleged professional negligence matters. He represents healthcare providers in all areas of professional liability and most extensively in complex large damage exposure matters such as birth trauma, delayed diagnosis of cancer, and wrongful death. Before joining Wiggin and Dana, he was in private practice concentrating on insurance defense, personal injury defense and commercial litigation. Mr. Budge received his B.A. from the University of Connecticut and his J.D. from Western New England College School of Law. Robert M. Langer is a partner in the Hartford, Connecticut office of Wiggin and Dana, LLP, where he is head of the firm's antitrust and consumer protection practice group. He is involved in all aspects of antitrust, consumer protection and trade regulation counseling and litigation, including class actions, representing clients in both federal and state courts, and before the
Federal Trade Commission, the Antitrust Division of the United States Department of Justice, as well as offices of state attorneys general throughout the United States. Mr. Langer received his A.B. from Franklin & Marshall College and his J.D. from the University of Connecticut School of Law.
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PROFESSIONAL EDUCATION BROADCAST NETWORK Speaker Contact Information DRAFTING SETTLEMENT AGREEMENTS IN LITIGATION Steven B. Malech Wiggin and Dana LLP New York City (o) (212) 551-2633 smalech@wiggin.com Kevin S. Budge Wiggin and Dana LLP New Haven, Connecticut (o) (203) 498-4378 kbudge@wiggin.com Robert Langer Wiggin and Dana LLP Hartford, Connecticut (o) (860) 297-3724 rlanger@wiggin.com
Drafting Settlement Agreements in Litigation Professional Education Broadcast Network Presented By: Steven B. Malech Robert M. Langer Kevin S. Budge
2 Overview Governing Law Traps for the Unwary Unforeseen Consequences Non-disclosure and Non-disparagement Provisions, Violations and Remedies
3 Settlement Agreement or Stipulation = Contract Needs to resolve a bona fide dispute with doubt as to the eventual result Definite and complete with all material terms
4 Strong public policy in favor of enforcement a. avoids potentially costly, time consuming litigation b. preserves scarce judicial resources; courts could not function if every dispute devolved into a lawsuit c. societal benefit in recognizing the autonomy of parties to shape their own solution to a controversy d. produces finality and repose upon which people can order their affairs e. interests are advanced only if settlements are routinely enforced rather than becoming gateways to litigation
5 Potential Challenges Lack of mutual assent Lack of consideration Failure to follow certain statutory requirements To constitute sufficient consideration... a party need only have a good-faith belief in the merit of its position CPLR 2104: unless made between counsel in open court, only binding if in writing and reduced to an order and entered Other contract defenses: collusion, duress, fraud, etc. Type of dispute cannot be settled by parties Will Construction Proceeding Open Court before judge and stenographer
6 Confidentiality Publicly Available Multistate enforcement Private class actions Good Cause to Seal Harm to a compelling interest of the movant
7 Negotiating Publicity Is it possible? Requesting copy of press release in advance of public release Attending Government s Press Conference
8 Collateral Estoppel Preventing the offensive use of Finality Negotiating an effective release 5 th Amendment Vis a vis criminal and licensure proceedings SOL Impact of suspension of statute of limitations
9 Impact of Settlement Agreement between Healthcare Providers & The Department of Public Health Potential impact outside of what is contained in the written agreement o Board Certification(s) o Public record Consider, negotiate and advise
10 Consideration for Confidentiality Possible tax consequences Amos v. Commissioner of Internal Revenue T.C. Memo 2003-239 (December 1, 2003). Possible alternatives
11 Disparagement
12 Nondisparagement Clause A provision in a contract requiring one or more parties to the agreement not to make negative statements about the other(s). Nolo s Plain English Law Dictionary http://www.nolo.com/dictionary/nondisparagement-clause-term.html Before Use: Confirm Legality CA: ban on contracts or proposed contracts for the sale or lease of consumer goods or services California Civil Code 1670.8. Penalties: $2,500 for first violation; $10,000 for willful, intentional or reckless violations. Non-Disparagement: Evidence of Good Faith?
13 Enforcement Conclusory Allegations Insufficient Allege disparaging statements, to whom made and when Case by Case analysis
Contact Information Steven B. Malech 212.551.2633 smalech@wiggin.com Robert M. Langer 860.297.3724 rlanger@wiggin.com Kevin S. Budge 203.498.4378 kbudge@wiggin.com
This presentation is a summary of legal principles. Nothing in this presentation constitutes legal advice, which can only be obtained as a result of a personal consultation with an attorney. The information published here is believed accurate at the time of publication, but is subject to change and does not purport to be a complete statement of all relevant issues.