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Daughter’s Facebook post reveals former headmaster’s breach of settlement’s confidentiality clause, costing dad $80,000

Joy P. Waltemath, J.D.

Because a discharged headmaster violated the confidentiality clause in his age discrimination settlement agreement by telling his daughter his case had settled, which she then trumpeted to approximately 1200 Facebook friends, the headmaster was precluded from enforcing the settlement agreement, a Florida state court of appeal ruled (Gulliver Schools Inc v Snay, February 26, 2014, Wells, L).

Settlement agreement’s confidentiality provision. The parties signed an agreement to settle the age discrimination and retaliation claims of the school’s former headmaster based on the nonrenewal of his contract. The settlement provided for the school to pay $10,000 in back pay to the headmaster with one check; $80,000 to the headmaster as a “1099” with a second check; and $60,000 to his attorneys with a third. Importantly, the agreement contained a confidentiality provision forbidding the headmaster from either directly or indirectly disclosing, discussing or communicating “to any entity or person, except his attorneys or other professional advisors or spouse any information whatsoever regarding the existence or terms of this Agreement.”  Violating the agreement’s confidentiality clause would result in a portion of the settlement proceeds (the $80,000 as a 1099) being disgorged.

This is why parents hate Facebook. Only four days after the agreement was signed, the school contacted its former employer to let him know that he had breached the confidentiality clause of the agreement based on the Facebook posting of his college-age daughter, which said “Mama and Papa Snay won the case against Gulliver. Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT.” According to the court, this Facebook post went out to approximately 1200 of the daughter’s Facebook friends, many of whom were either current or past students at the school.

This all happened within the seven-day period in which the headmaster had the right to revoke the agreement; however, the headmaster took no action to revoke. The next week, the school tendered the attorneys’ fees check and later tendered the $10,000 in back pay. Eventually, the headmaster sued to enforce the settlement agreement to get his $80,000.

Although the trial court had ruled that neither the headmaster’s communication to his daughter nor her Facebook post breached the confidentiality agreement, the appeals court disagreed. It found the plain, unambiguous meaning of the agreement’s confidentiality clause was that neither the headmaster nor his wife would “either directly or indirectly” disclose to anyone (other than their lawyers or other professionals) “any information” regarding the existence or the terms of the settlement. Because the headmaster testified in deposition that he told his daughter that the case was settled and he was happy with the results, that alone established a breach, concluded the court, and enforcement of the settlement agreement should have been denied.

Daughter’s need to know. Moreover, the court was not sympathetic to the headmaster’s argument that he needed to tell his daughter something (because she too allegedly had been subject to retaliation at the school); there was no evidence that he made his concerns known to the school, or even to his own attorneys, so that this issue could be addressed by the parties. “Before the ink was dry,” commented the court, the headmaster “violated the agreement by doing exactly what he had promised not to do.”  Moreover, his daughter then did precisely what the confidentiality agreement was designed to avoid, broadcasting to the school community that the headmaster had been successful in his age discrimination and retaliation case.