Shhhh. Don't Tell Anyone This. It's Confidential.
A recent article posted about confidentiality proves to be a costly reminder about settlement and confidentiality agreements signed and sworn to by parties. Patrick Snay was a headmaster of Gulliver Preparatory School (Miami, FL) until 2010. He sued for age discrimination and won $10,000 in back wages and a settlement worth $80,000 – we now know. But, part of the settlement was a confidentiality agreement.
According to the Miami Herald, under the Snay confidentiality agreement, Headmaster and Mrs. Snay agreed not to tell anyone about the settlement. Unfortunately, the Headmaster told his daughter, Dana Snay, who took to Facebook to tell her 1,200 plus friends: “Mama and Papa Snay won the case against Gulliver. Gulliver is now officially paying my vacation to Europe this summer. SUCK IT.” Nice piece of in your face internet justice except for the fact that it was in clear derogation to the confidentiality agreement signed by her dad. Or so says a court of law.
The Headmaster won the case stemming from the employment claim, but Dana’s Facebook post has Florida’s Third District Court of Appeals siding with the prep school and her dad lost the $80,000. The Snays do have option to move for a rehearing or appeal the decision to the Florida Supreme Court.
Have you ever been in a lawsuit ending in settlement? Do you know if you signed a confidentiality agreement? If you did, do you have a copy of it? Despite attorneys advising their clients of the severity of confidentiality agreements, we still see instances like the Snays. Many confidentiality provisions in settlements prevent the parties from disclosing the mere fact and existence of a monetary settlement much less disclose the amount of money.
A confidentiality agreement is a legally enforceable contract that creates a confidential relationship between a person who holds some kind of secret and another person.
In some sensitive cases, parties execute settlement agreements and separate confidentiality agreements. For instance, when employees are fired, painstaking effort is taken to craft tightly worded confidentiality agreements to spare one or both parties from embarrassment. Likewise, environmental cases typically entail very strict and detailed confidentiality agreements to protect landowners. Sometimes only confidentiality paragraphs are contained within settlement agreements. Other times parties settle for a dollar amount and no confidentiality agreements were even contemplated. Many car wreck settlements do not even contain the word “confidential” in them. Regardless, we know courts routinely uphold confidentiality agreements and attorneys should educate their clients on the ramifications, seriousness, and potential expense of breaking a well written confidentiality agreement.
The Snays found out first-hand the consequences of violating a confidentiality agreement cannot only lead to injunctive relief, but also have monetary consequences. If you have questions about confidentiality agreements, contact Babcock Partners, LLC for a free case review today.