The opinion of the court was delivered by: Honorable Alison J. Nathan, U.S.D.J.
REPORT AND RECOMMENDATION TO THE HONORABLE ALISON J. NATHAN, U.S.D.J.
Plaintiff Denise Lyman has filed a motion to re-open this action, which was closed following a settlement conference held before me on May 24, 2012. The remaining defendants, The New York and Presbyterian Hospital (the "Hospital") and Maria LaPorta, oppose the motion, arguing that the parties entered into an enforceable oral agreement to settle the case at the conference. For the following reasons, I recommend that the motion be granted.
Ms. Lyman filed this action against the Hospital; Maria LaPorta, the plaintiff's supervisor at the Hospital; and Waldner's Business Environments, a furniture vendor ("Waldner's"), alleging, among other things, that the defendants discriminated against her on the basis of a disability in violation of the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq. All claims against defendant Waldner's were dismissed with prejudice by stipulation in February 2012.
I held a settlement conference with the remaining parties on May 24, 2012. At its conclusion, the parties had agreed on certain terms to settle the action, including a payment of $59,500 to the plaintiff, a non-disparagement agreement, and a confidentiality provision.*fn1 On May 30, 2012, the Honorable Alison J. Nathan, U.S.D.J., issued an order discontinuing the case "without prejudice to restoring the action" to the Court's calendar within 30 days.*fn2
(Order dated May 30, 2012).
Counsel for the defendants sent a draft settlement agreement to plaintiff's former counsel, Rebecca J. Osborne of Vladeck, Waldman, Elias & Engelhard, P.C. (the "Vladeck Firm"), on June 21, 2012. (Cesaratto Cert., ¶ 7; E-Mail of Frances Many-Harris dated June 21, 2012, attached as part of Exh. E to Cohn Aff.;*fn3 First Draft Agreement). Ms. Osborne returned a red-lined version of the agreement with proposed changes to defendants' counsel on August 15, 2012. (E-Mail of Rebecca Osborne dated Aug. 15, 2012, attached as part of Exh. E to Cohn Aff.; Red-lined Draft of Confidential Settlement Agreement dated Aug. 2012 ("Red-Lined Draft Agreement"), attached as part of Exh. E to Cohn Aff.). The proposed changes included:
1. A provision stating that the settlement amount is to be paid to Ms. Lyman for emotional distress and reported to the IRS by menas of a Form 1099 (Red-Lined Draft Agreement, ¶ 1);
2. A provision requesting that certain identified and theretofore unidentified entities associated with the Hospital be exempted from Ms. Lyman's release of claims (Red-Lined Draft Agreement, ¶ 4(B));
3. A provision extending the non-disparagement provision to include other Hospital employees in addition to Ms. LaPorta (Red-Lined Draft Agreement, ¶ 8);
4. A provision extending the confidentiality provision to include Ms. LaPorta and the Hospital in addition to Ms. Lyman (Red-Lined Draft Agreement, ¶ 9); and
5. A provision exempting Ms. Lyman from the prohibition on applying for or accepting employment with Hospital if an entity that employs Ms. Lyman is later acquired by the Hospital (Red-Lined Draft Agreement, ¶ 10).
By late August, the parties had agreed that the settlement payment would be issued to the Vladeck Firm as attorneys for Ms. Lyman, and that the payment would be reported to the IRS in a Form 1099. (Cesaratto Cert., ¶ 9; E-mail of Rebecca Osborne dated Aug. 24, 2012 ("Osborne Aug. 24 E-mail"), attached as part of Exh. B to Osborne Aff.). However, disputes remained about a number of issues, including the Vladeck Firm's indemnification of the Hospital for any tax consequences attendant to the issuance of the payment and the Form 1099; the entities covered by the prohibition on re-employment; and the scope of the non-disparagement provision.
(E-mail of Brian Cesaratto dated Aug. 27, 2012, 2:24 PM ("First Cesaratto Aug. 27 E-mail"), attached as part of Exh. B to Osborne Aff.; E-mail of Rebecca Osborne dated Aug. 27, 2012, 3:10 PM ("Osborne Aug. 27 E-mail"), attached as part of Exh. B to Osborne Aff.; E-mail of Brian Cesaratto dated Aug. 27, 2012, 4:59 PM ("Second Cesaratto Aug. 27 E-mail"), attached as part of Exh. B to Osborne Aff.). Moreover, the Vladeck Firm was planning to seek to withdraw from representing the plaintiff. (E-mail of Brian G. Cesaratto dated Aug. 28, 2012 ("Cesaratto Aug. 28 E-mail"), attached as part of Exh. E to Cohn Aff.). On August 28, 2012, defendants' counsel sent plaintiff's counsel a draft of the settlement agreement for signature. (Cesaratto Aug. 28 E-mail). It differed from the First Draft Agreement in only two significant respects: it required payment to be made to the Vladeck Firm and reported to the IRS in a Form 1099, and it required both Ms. Lyman and the Vladeck Firm to indemnify the ...