Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
The Settlement Privilege and the Threat of Legal Action
Editor's Note: The Federal Rules of Evidence (FED. R. EVID. 408) and similar state rules prohibit the introduction into evidence of statements or acts made during compromise negotiations if they are offered to prove the validity or value of a claim. This so-called “settlement privilege” is meant to encourage the parties to negotiate and settle, where possible. But, as the authors pointed out in Part One of this article, there may be a fine line between a settlement offer and an attempt at extortion ' “Pay what I ask or I will sue (and commercially disparage your company).” Here, they describe how two courts came to opposite conclusions about the settlement privilege, and discuss the advisability of enacting an exception to that privilege when an offer rises to the level of an extortionate threat.
Sanders v. Madison Square Garden
In Sanders v. Madison Square Garden, L.P., 525 F. Supp. 2d 364 (S.D.N.Y. 2007), the Southern District of New York addressed the application of the settlement privilege in the context of potentially extortionate settlement discussions. There, the plaintiff commenced a lawsuit against her former employer, alleging that: 1) she was discriminated against on the basis of gender by virtue of sexual harassment by the defendant; and 2) she was fired in retaliation for her sexual harassment claim. To prove the retaliation claim, the plaintiff had to establish, among other things, that she was acting in good faith when she made her sexual harassment claim. The defendants sought to present evidence that the plaintiff offered a large sum of money to settle the sexual harassment claim, suggesting that she did not believe she had a good-faith claim, but rather sought to extort money from the defendants. The court granted the plaintiff's motion in limine to exclude this evidence, stating that this was simply an effort to use compromise discourse to disprove the validity of her claim. The court explained its ruling as follows:
[A]ccording to defendants, [evidence of plaintiff's large settlement demand] shows that her underlying sexual harassment claim was made in bad faith, that is, that it was not merely invalid, but was known to be such by plaintiff when she made it. Thus, even if the offer is limited to its alleged relevance to the retaliation claim, it is offered precisely for the forbidden purpose of showing that the underlying claim that was the subject of the settlement discussions was frivolous.
This premium content is locked for Entertainment Law & Finance subscribers only
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
- Stay current on the latest information, rulings, regulations, and trends
- Includes practical, must-have information on copyrights, royalties, AI, and more
- Tap into expert guidance from top entertainment lawyers and experts
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Anti-Assignment Override Provisions
UCC Sections 9406(d) and 9408(a) are one of the most powerful, yet least understood, sections of the Uniform Commercial Code. On their face, they appear to override anti-assignment provisions in agreements that would limit the grant of a security interest. But do these sections really work?