When a Florida private school, Gulliver Schools, failed to renew Patrick Snay’s contract as the school’s headmaster in 2010-2011, Snay filed a two-count lawsuit against the school, alleging age discrimination and retaliation under the Florida Civil Rights Act. The parties eventually assented to settlement and, on November 3, 2011, executed a General Release and Settlement Agreement for full and final resolution of the claims. Under the terms of the agreement, the school was to issue the following three payments: $10,000 in back pay to Snay; $80,000 as a “1099” to Snay; and $60,000 to Snay’s legal counsel for attorneys’ fees. The settlement agreement contained a very important, and, accordingly, very common, “confidentiality” or “non-disclosure” agreement. In this particular provision, the confidentiality clause read:
13. Confidentiality . . . [T]he plaintiff shall not either directly or indirectly, disclose, discuss or communicate to any entity or person, except his attorneys or other professional advisors or spouse any information whatsoever regarding the existence or terms of this Agreement . . . A breach . . . will result in disgorgement of the Plaintiff’s portion of the settlement Payments.
Within days of executing the settlement agreement, Gulliver learned that Snay had breached the confidentiality provision by disclosing the settlement, and apparently his satisfaction with it, to his daughter. The violation of the non-disclosure agreement was apparent from a Facebook post published by Dana Snay, the Snays’ college-aged daughter, who broadcasted to her approximately 1,200 Facebook friends, including Gulliver students or alumni:
“Mama and Papa Snay won the case against Gulliver. Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT.”
Upon learning of the Facebook post, Gulliver immediately notified Snay he was in breach of the settlement agreement’s confidentiality provision and refused to tender the previously agreed-upon payments to Snay (although the school later agreed to issue Snay the $10,000 payment for back wages). Snay filed a Motion to Compel Enforcement of Settlement Agreement with the trial court, which the court granted. The school appealed, and a Florida appellate court recently sided with the school by reversing the trial court’s decision. The appellate court held that Snay’s communications with his daughter constituted a breach of the confidentiality provision of the settlement agreement and denied Snay’s enforcement of the settlement agreement to the tune of $80,000.
This decision illustrates that violating a material term of a settlement agreement can be costly. And where a confidentiality or non-disclosure agreement and/or clause is involved, silence is truly golden.
How to Avoid Falling Victim to a Non-Disclosure Agreement Breach
While executing a settlement agreement might lead to the conclusion of a pending legal dispute, it also often signifies the commencement of a host of significant obligations for the parties involved. Before entering into any settlement agreement, consult with an attorney who can assist you with negotiating appropriate terms; fully understanding the agreement’s provisions, parameters, and the consequences of a breach; and ensuring your actions remain in compliance.
Finally, this decision serves as a valuable reminder that personal legal matters are “TMI” for social media platforms, where such issues should never be discussed. Communications about your legal matter should be reserved for your attorney to avoid the risk of disclosing confidential information and/or waiving the attorney-client privilege.