4:15-cv-00322
E.D. Mo.Nov 1, 2016Background
- Plaintiff James P. Blount sued multiple defendants alleging claims that led to affirmative defenses of set-off by defendants Miller, Napier, and Nicholay.
- Plaintiff moved to dismiss several defendants with prejudice pursuant to settlement agreements; those agreements contain confidentiality provisions.
- Miller, Napier, and Nicholay requested production of the dismissed-defendant settlement terms, asserting relevance to their set-off defense, settlement negotiations, and witness-bias evaluation.
- Plaintiff refused, arguing confidentiality and that set-off is only a post-judgment defense (thus settlement terms are irrelevant).
- Defendants sought a protective order from the dismissed defendants to limit disclosure; the court held a hearing and considered Federal Rule of Civil Procedure 26 relevance principles.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether settlement terms are discoverable | Settlement terms are confidential and irrelevant because set-off applies only to judgments | Settlement amounts and related terms are relevant to respond to settlement demand, trial strategy, potential set-off effect, and witness bias | Court ordered production of settlement terms limited to provisions about witness testimony and settlement amounts/net proceeds; production under attorneys'-eyes-only seal |
| Whether confidentiality alone shields settlement agreements from discovery | Confidentiality clause prevents disclosure | Confidentiality does not create privilege; discoverability depends on relevance | Court: confidentiality does not bar discovery; protective order (attorneys' eyes only, sealed) will protect interests |
| Whether pre-judgment discovery may include information bearing on post-judgment defenses | Set-off is post-judgment, so prior settlement details irrelevant | Post-judgment nature does not preclude discovery; Rule 26 allows broad relevance for litigation and settlement strategy | Court: post-judgment character of set-off does not preclude discovery of settlement amounts for strategy, bias, and potential effect on damages |
| Scope of required disclosure | Plaintiff sought to withhold all settlement terms | Defendants sought full terms to evaluate liability, bias, and settlement demand | Court limited disclosure to terms related to witness testimony and monetary amounts/disbursements (net proceeds after fees/costs) and required production by a set date |
Key Cases Cited
- DIRECTV, Inc. v. Puccinelli, 224 F.R.D. 677 (D. Kan. 2004) (settlement confidentiality alone does not bar discovery; relevance is the test)
- Hofer v. Mack Trucks, Inc., 981 F.2d 377 (8th Cir. 1992) (party seeking discovery must make a threshold showing of relevance)
- Bennett v. La Pere, 112 F.R.D. 136 (D.R.I. 1986) (confidential settlement terms are not automatically shielded from discovery)