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Galanis v. The Harmonie Club of The City of New York

United States District Court, S.D. New York

October 2, 2014



GREGORY H. WOODS, District Judge.

Defendants the Harmonie Club of the City of New York and Christopher Carey move to enforce a settlement agreement purportedly entered into with plaintiff Denis Galanis in Galanis's employment discrimination action. The Court holds that the parties entered into an enforceable agreement to settle Galanis's claims. Accordingly, Defendants' motion is granted and Galanis's claims are dismissed.

I. Background[1]

In June 2013, Galanis, through counsel Ioannis P. Sipsas, filed a complaint against the Harmonie Club of the City of New York (the "Club"), a private social club at which Galanis was employed as a waiter, and Christopher Carey, the Club's General Manager. See Dkt. No. 1. Galanis raised claims of, inter alia, age discrimination under the Age Discrimination in Employment Act ("ADEA") and the parallel provisions of New York state and City law, as well as a claim of "aider and abettor" liability under state law.[2] See id.

In March 2014, the parties participated in a Court ordered mediation session. See March 19, 2014 Dkt. Entry. Although they exchanged settlement offers, the parties were unable to reach a settlement during the mediation session. See Dkt. No. 78, Declaration of Brian J. Turoff in Support of Motion to Enforce Settlement Agreement ("Turoff Decl.") ¶¶ 4-5. The parties nonetheless continued to engage in settlement discussions. Id. ¶ 5.

On May 28, 2014, in response to an email offer from Mr. Sipsas, Defendants agreed to make a lump-sum payment in exchange for, inter alia, Galanis dismissing this action with prejudice, providing a release to Defendants, resigning from his employment with the Club, refraining from disparaging Defendants, and maintaining the confidentiality of the terms of the parties' agreement. Id. ¶¶ 6-7. According to Galanis, however, he had not authorized Mr. Sipsas to settle the case on his behalf and did not agree to the terms of the settlement at the time. See Dkt. No. 68, Affidavit of Denis Galanis in Opposition to Motion to Enforce Settlement Agreement ("Galanis Aff.) ¶ 9.

Nonetheless, based on the agreement, Defendants advised the Court by letter dated May 28, 2014 that the parties had reached a settlement in principle and were in the process of completing a final settlement document. See Dkt. No. 42 at 2. In light of Defendants' representation, the Court dismissed this action on the same day, subject to each party's right to reinstate the action within 15 days. Id. at 1.

On June 4, 2014, however, Mr. Sipsas informed the Court by letter that Galanis had asked Mr. Sipsas to "retrieve [Galanis's] consent [to the] settlement" and to withdraw from representing Galanis. See Dkt. No. 43 at 1. Mr. Sipsas attached to his submission two sworn letters addressed to him from Galanis dated June 4, 2014. See Dkt. No. 43, Ex. A. In one letter, Galanis stated, "Please be informed that I have decided, after I thought things through one more time, that I do not want to accept the settlement that I agreed to previously." Id. at 1. In the other letter, Galanis stated, "This is to notify you that I wish to terminate your representation in the referenced case, effectively [sic] immediately." Id. at 2. Citing Galanis's apparent disavowal of the settlement agreement, the Court reopened the case. See Dkt. No. 44.

On June 10, 2014, Mr. Sipsas formally moved to withdraw as Galanis's counsel. See Dkt. No. 48. In support of his motion, Mr. Sipsas asserted that he and Galanis "strongly disagree[d] on litigation strategies, " that there had been a "break-down of substantive communications" between he and Galanis, and that Galanis had "indicated that he no longer wishes to be represented by [Mr. Sipsas]." Id. at 1.

On June 13, 2014, while decision on Mr. Sipsas's motion to withdraw remained pending, Mr. Sipsas called Galanis and asked him come to Mr. Sipsas's office to discuss the case. Galanis Aff. ¶ 11. Galanis "decided to meet Mr. Sipsas at his office to hear what he wanted to discuss, although at no time did [Galanis] consider [Mr. Sipsas] to be [his] lawyer or [to] have any authority to settle this matter on [his] behalf or continue to represent [him] in any other way." Id. ¶ 12. Upon meeting at Mr. Sipsas's office, Mr. Sipsas "advised [Galanis] that Defendants had made a second offer to settle [his] case and that the offer was fair." Id. ¶ 13. "As a result of Mr. Sipsas's tone in advising [Galanis] [of] the settlement offer, [Galanis] felt pressured and threatened to accept Defendants' terms." Id. ¶ 14. Galanis "agreed to make a phone call with Mr. Sipsas to Defendants' counsel" to discuss the offer. Id. ¶ 15.

Brian J. Turoff, counsel for Defendants, subsequently received a telephone call in which both Mr. Sipsas and Galanis were on the line. Turoff Aff. ¶ 16. Mr. Sipsas advised Mr. Turoff that Galanis "now wanted to resolve the case on the same terms that had been previously agreed to on May 28, 2014." Id. Additionally, Galanis himself "indicated that he had made a mistake in attempting to reject the Agreement, and that he now wanted to settle the case on the terms as agreed to on May 28, 2014." Id. Mr. Turoff stated that he needed to speak with his client and that he would call Mr. Sipsas back. Dkt. No. 81, Declaration of Ioannis P. Sipsas in Support of Motion to Enforce Settlement Agreement ("Sipsas Decl.") ¶ 3.

Mr. Turoff called Mr. Sipsas and Galanis back shortly thereafter, at which point "the parties discussed, listed, and agreed to one-by-one, each and every material term of the Agreement, " and Galanis "personally agreed to and confirmed that he understood all of the agreement's material terms." Id. ¶ 4. As summarized by Mr. Turoff:

The parties, again including Plaintiff himself, then reaffirmed their binding settlement agreement. Specifically, the parties explicitly enumerated and agreed to, one by one, each and every material term of the Agreement, including, without limitation, the settlement amount and its breakdown, Plaintiff's resignation from the club, the release, ... and the confidentiality and non-disparagement provisions. Even the Agreement's governing law, New York, was expressly agreed to.

Turoff Decl. ¶ 17. Crucially, "[t]he parties also explicitly stated and agreed that this oral agreement was an immediately enforceable and binding contract, irrespective of whether the Agreement was memorialized in a formal' settlement agreement." Id. ¶ 18; accord Sipsas Decl. ¶ 4 ("Plaintiff also explicitly agreed that this agreement was immediately binding and enforceable, irrespective of whether the agreement was memorialized in a written settlement agreement.").

Although Galanis does not provide a detailed account of the parties' June 13, 2014 conversation, for the most part he has not challenged Mr. Turoff's or Mr. Sipsas's descriptions of that conversation in his motion papers.[3] Galanis agrees that during the phone call, he "stated that certain terms of the offer were agreeable to [him]." Galanis Aff. ¶ 19. Galanis emphasizes, however, that he "fully expected that [he] would not be bound to any agreement until it was in writing and signed by [him] personally, " that "at no time during the phone call did [he] consider Mr. Sipsas to be authorized to accept a settlement offer on [his] behalf, " and that he "felt pressured by both Mr. Sipsas and [Mr. Turoff] during the phone call to agree to the terms they were discussing." Id. ¶¶ 17, 19, 21.

Galanis and Mr. Sipsas then "indicated during [the] call that [Galanis] wanted to personally inform the Court of the parties' agreement." Turoff Decl. ¶ 19. Accordingly, Galanis and counsel for both sides jointly called the Court and conveyed the above information to one of the Court's law clerks, who advised the parties to submit a letter to the same effect. Id. ¶ 20. In a June 13, 2014 letter filed and signed by Mr. Turoff only, the Court was advised as follows:

The parties submit the instant letter jointly to advise that, by way of telephone conversations involving Plaintiff himself, Plaintiff's counsel John Sipsas, and Defendants' counsel, Plaintiff explicitly confirmed today that he has agreed to all terms of a binding settlement agreement in this matter. While the parties intend to memorialize the agreement's terms in a writing, the parties have explicitly agreed that, even in the absence of such a writing, the parties are bound by the terms of the oral agreement that has been reached. The parties' agreement does not depend upon the existence of a writing. The ...

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