March 17, 2014 Ossian Law P.C. IT Law Alert

Facebook Post Voids $80,000 Settlement: Settlement agreements often include a clause prohibiting the parties from disclosing the terms of settlement. This clause would be breached if a party convened a press conference to discuss the settlement or posted the settlement terms online. Telling a relative who then posts a status update about the settlement is equally problematic.

Patrick Snay, former headmaster, filed an age discrimination claim against Gulliver School after his contract was not renewed. In 2011, the parties settled. Gulliver agreed to pay Snay backpay, attorney fees plus and additional $80,000. Snay agreed that he would not “directly or indirectly disclose, discuss or communicate . . . the existence or terms” of the agreement with anyone other than his attorneys or his wife.

Four days later, Snay’s teenage daughter posted this Facebook status:

“Mama and Papa Snay won the case against Gulliver. Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT.”

Many of her 1200 Facebook friends were Gulliver students and alumni. Gulliver notified Snay that he had breached the nondisclosure clause and, therefore, it would not be paying him the $80,000. Snay filed a motion to enforce the agreement, which the trial court granted. The school appealed. The appeals court found that Snay’s deposition testimony that he told his daughter that “the case was settled and we were happy with the results” was an admitted breach of the non-disclosure clause, relieving Gulliver of its obligation to pay Snay the $800,000.

The appeals court decision is available here.

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