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Baer v. Wabash Center, Inc.

United States District Court, N.D. Indiana, Hammond Division, Lafayette

October 18, 2016

KRISTY B. BAER, Plaintiff,



         This matter is before the Court on Plaintiff's Motion to Enforce Settlement Agreement [DE 25], filed by Plaintiff Kristy Baer on June 15, 2016, and on Plaintiff's Second Motion to Seal Settlement Agreement [DE 28], filed by Baer on June 20, 2016. Baer asks the Court to enforce the settlement agreement between her and Defendant Wabash Center, Inc., and to seal the draft settlement agreement that Baer Dated: June 3, 2016 [DE 29].

         I. Background

         Wabash Center, Inc. is an Indiana corporation that provides services to people with disabilities. Kristy Baer used to work for Wabash, but after Wabash fired her she sued Wabash, seeking to be reinstated in her former position.

         The parties negotiated a settlement to the lawsuit: in essence, Baer would agree to drop the lawsuit in exchange for a certain amount of money. On May 11, 2016, Wabash's lawyer wrote to Baer's lawyer that Wabash had “agreed to accept” Baer's settlement demand. Wabash's lawyer added, “I will prepare a draft of the settlement agreement to send you with a stipulation of dismissal.” The parties hit a roadblock the following week as they tried to finalize the written terms of their deal. On May 20, Wabash's lawyer emailed Baer's lawyer a written draft of the settlement and wrote, “Let me know if this meets with your approval or if [you] have any suggestions for any changes.” Three days later, on May 23, Wabash's lawyer emailed Baer's lawyer again, this time attaching a “revised settlement [draft]” with a new provision requiring Baer to “agree[] to abide by the Wabash Center . . . Visitors policy should she wish to visit any of the Wabash Center properties.” This provision had not appeared in the May 20 draft.

         Baer balked at the new provision. On May 25, her lawyer wrote to Wabash's lawyer that Baer could not agree to the new provision. “If that is an issue, ” Baer's lawyer wrote, “let me know.” On June 1, Wabash's lawyer responded that it was indeed an issue.

         On June 3, Baer signed the May 20 draft, and on June 9 her lawyer sent Wabash's lawyer a signed copy and asked Wabash to sign it and honor the May 20 settlement terms.

         Wabash declined to sign the May 20 draft.

         Baer now asks the Court to enforce the May 20 version of the parties' settlement agreement. See MH Equity Managing Member, LLC v. Sands, 938 N.E.2d 750, 757 (Ind.Ct.App. 2010) (“if a party agrees to settle a pending action, but then refuses to consummate his settlement agreement, the opposing party may obtain judgment enforcing the agreement”). Baer also asks the Court to seal the May 20 draft settlement agreement, which she has filed as Exhibit D in support of the motion to enforce the settlement agreement. Wabash opposes the motion to enforce the settlement agreement, but Wabash does not object to the motion to seal.

         II. Analysis

         A. The motion to enforce the settlement agreement

         Normal contract law principles govern settlement agreements in Indiana. MH Equity, 938 N.E.2d at 757; see also Zimmerman v. McColley, 826 N.E.2d 71, 77 (Ind.Ct.App. 2005) (“The intention of the parties to a [settlement] contract is a factual matter to be determined from all the circumstances.”); Lewis v. Sch. Dist. #70, 648 F.3d 484, 486 n.1 (7th Cir. 2011) (“Whether a settlement agreement is binding is an issue governed by the law of the state in which the parties executed the agreement.”).

         Here, Baer says, Baer made a final offer, and Wabash accepted it on May 11. That alone, Baer says, constitutes an enforceable agreement, and the provision Wabash sought to include in the May 23 draft is immaterial to the agreement. Dillard v. Starcon Int'l, Inc., 483 F.3d 502, 508 (7th Cir. 2007) (“terms addressing purely contingent matters are not necessarily material”); Steadfast Ins. Co. v. Auto Mktg. Network, Inc., No. 97-5696, 2004 U.S. Dist. LEXIS 7294, *13 (N.D. Ill. Apr. 28, 2004) (“If Steadfast wanted a confidentiality clause, it should have made it known during the negotiations.”). And an unresolved immaterial term does not justify breaching the material terms of an agreement. Higbee v. Sentry Ins. Co., 253 F.3d 994, 997 (7th Cir. 2001) (“lack of agreement on minor, immaterial terms . . . do not preclude a finding that a contract has been formed”); Beverly v. Abbott Labs., 817 F.3d 328 (7th Cir. 2016) (finding indemnification, cooperation, and future employment issues not material and enforcing handwritten settlement agreement between employer and employee). The mere fact that parties disagree on whether to include a certain provision in their written agreement does not make the issue material. Dillard, 483 F.3d at 508 (“The materiality of additional written terms introduced after an . . . agreement is reached is not established simply by one party's intransigence or ‘refusal to budge' on the new terms.”).

         The Court agrees with Baer that the provision at issue in the May 23 draft is not material to the settlement agreement. The material terms of the parties' settlement agreement are: (1) that Baer will release her claims against Wabash and agree not to apply for re-employment and not to disparage Wabash to any third party; and (2) that in exchange Wabash will pay Baer a certain amount of money, characterize the termination of Baer's employment in a certain way, and make only certain limited representations to Baer's future employers. In the May 23 draft, Wabash sought to include a provision by which Baer would agree to abide by Wabash's visitors ...

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