Topics: Gag Orders

   
 

The following essay on gag orders was written by two Boston lawyers who have handled a large number of abuse cases.   They argue that gag orders run counter to public policy and should be unenforceable.

 

Hush Money:  Confidential Settlements In Sex Abuse Cases

Defense lawyers and insurers routinely seek to have confidentiality agreements signed in connection with the settlement of a lawsuit alleging sexual abuse by a member of the medical profession of a patient or by clergy of a congregant.  The settlement of a lawsuit typically represents a plaintiff’s agreement to dismiss the lawsuit in exchange for the payment of a negotiated amount of money by the defendant (or his or her insurance company). A confidentiality agreement, whether included in the settlement papers or as an independent contract, places additional obligations on the part of the plaintiff to remain silent about the facts of the lawsuit and the terms of the settlement. In the context of a lawsuit over sex abuse, such agreements should not be signed by victims of abuse and, when they are signed, should be considered unenforceable and void as against public policy.

Plaintiffs in sexual abuse cases should not be forced to choose between compensation for their injuries and their right to inform the public about the risk of abuse that the defendant poses.  If abusers can force silence by insisting on the execution of a confidentiality agreement as part of any settlement, they ensure that new victims will not have the information that may have otherwise prevented them from coming into harm’s way. Such a result is unconscionable where knowledge of the defendant’s propensity to engage in abusive conduct exists but could not be disclosed due to a plaintiff’s acceptance of a “take it or leave it” portion of a settlement.  Therefore, despite the economic pressure defendants and insurers can bring to bear on victims by withholding necessary compensation to victims, plaintiffs’ lawyers and their clients should take a firm stand on the issue and refuse to sign such agreements as a matter of principle.  Even where the victim has no present intention of disclosing the defendant’s abuse to anyone, the forfeiture of his or her right to do so confers a benefit on the defendant that, at a minimum, requires additional consideration in the negotiation of the settlement. 

When such agreements are executed, courts should decline to enforce them because they are against public policy.  Although courts generally will not interfere with an individual’s freedom to contract, there are limited instances in which courts will decline enforcement of a private contract that violates public policy.  {See Beacon Hill Civic Association v. Ristorante Toscano, Inc., 422 Mass. 318, 320-321 (1996).} In deciding whether to enforce such agreements, judges must balance the contractual rights of an individual against the preservation of public health and safety. 

Such a “balancing test” is endorsed by the American Law Institute when a court is faced with a decision as to whether a contract may be deemed unenforceable as contrary to public policy. Section 178 of the Restatement (Second) of Contracts provides a four-prong test of relevant factors to be determined by a judge.  The court must consider: 1) the strength of the policy as manifested by legislation or decisions; 2) the likelihood that non-enforcement will further the policy at stake; and 3) the seriousness of the misconduct at issue and the extent to which it was deliberate; and 4) the causal connection between that misconduct and the terms of the nondisclosure agreement.  If these factors are present and the public policy at stake “clearly outweighs the necessity of preserving the integrity of traditional contract law principles”, then the court should deny enforcement of the confidentiality agreement at issue.  (Id. at 858; Restatement (Second) of Contracts § 178 (1981))

Analogy can be made to sexual harassment litigation in which courts have examined the circumstances in which public policy concerns may outweigh the need to uphold a private contract.  For example, in EEOC v. Astra USA, Inc., 929 F. Supp. 512 (D. Mass., 1996), the court used public policy to justify its decision to strike down a confidentiality agreement.  In that case, an employer sought enforcement of private settlement agreements with former employees prohibiting the former employees from communicating with the EEOC in connection with its investigations of sexual harassment charges against the employer.  {Id. at 515}  The court held that the confidentiality agreement, insofar as it precluded the settling parties from communicating with the EEOC about the existence and scope of sexual harassment at the company, was void as against public policy.  {Id. at 519}  The public policy in favor of protecting citizens from sexual predators can only be viewed as an even stronger public interest than that which was in play in the Astra USA, Inc. case. 

Similarly, in Kalinauskas v. Wong, 151 F.R.D. 363 (D. Nev. 1993), the court performed a balancing analysis and decided not to honor a confidentiality agreement.  In Kalinauskas, an employer sought a protective order when its former employee, currently suing it for sexual discrimination, wanted to take the deposition of another former employee who had entered into a confidentiality agreement upon settling a similar sex discrimination claim.  {Id. at 365} In deciding not to enforce the confidentiality agreement, the court expressed concern that enforcing the confidentiality agreement would support the practice of “buying silence” and ultimately harming public health and safety by preventing witnesses from offering vital testimony.  The court reasoned that, “despite [the] freedom to contract, the courts must carefully police the circumstances under which litigants seek to protect their interests while concealing legitimate areas of public concern. This concern grows more pressing as additional individuals are harmed by identical or similar action.”  {Kalinauskas at 365}

The “concern” that additional individuals may be harmed by “identical or similar conduct” should be the overriding concern of parties considering whether to sign confidentiality agreements and courts considering whether to enforce them.  The consequences of silence in the setting of sexual abuse are apparent in light of the epidemic of sexual abuse that was finally unearthed in recent years in the Catholic Church.  While individual victims may choose not to disclose their abuse, the silence fostered by the Catholic Church in the face of clear evidence and knowledge of ongoing abuse by members of its clergy provides the only example necessary to illustrate the manner in which sexual predators will continue to harm victims unless and until their conduct is exposed. 

Andrew C. Meyer, Jr. and Adam R. Satin, Lubin & Meyer, P.C.

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