Maria Cortinas v. Liberty Mutual Personal Insurance Company, 5:22-cv-00544

Background

Plaintiffs (Holmes et al.) sued Liberty Mutual group insurers alleging improper depreciation of future labor in actual cash value (ACV) payments; parties negotiated a class settlement.
The parties executed a confidential Settlement Agreement, the Court preliminarily approved it, and later entered a Final Judgment that expressly incorporated the Agreement and retained jurisdiction to enforce it.
The Settlement Agreement (inter alia): (a) bars use of the Agreement, negotiations, or the administration of the Settlement to support class-certification motions in other cases (§15.2); (b) limits disclosure/use of Confidential Information and permits independent discovery in other litigation only if independently obtained (§16.1, §16.3); and (c) expressly binds attorneys and Class Counsel (§19.4, §2.9).
After the settlement, Class Counsel (Peterson, McWherter, Snodgrass) filed related suits in Massachusetts and Texas (Glasner; Cortinas) and served deposition notices seeking: (1) the person who compiled the Holmes class list (relating to §5.2); and (2) the person supervising calculation of claim amounts (relating to §7.1 et seq.).
Liberty Mutual moved to enforce the Settlement Agreement, arguing those deposition notices improperly seek to use settlement-administration information and Confidential Information; the Court granted the motion, holding the notices violate the Agreement.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Class Counsel are bound by the Settlement Agreement	Class Counsel (Holmes) say they are not "Parties" and thus not bound	Liberty Mutual says the Agreement expressly binds attorneys and defines "Class Counsel"	Court: Class Counsel are bound; read §19.4 and §2.9 together to include counsel
Whether deposition notices improperly seek use of the administration of the Settlement (§15.2)	Holmes: notices seek relevant discovery for class-certification in other suits and are permitted	Liberty Mutual: notices target §§5.2 and 7.1 (Settlement administration) and are barred by §15.2	Court: Notices violate §15.2 because they specifically target administration tasks (class list, claims calculation)
Whether notices improperly seek Confidential Information (§16.3)	Holmes: Agreement allows independent discovery of Confidential Information in other litigation	Liberty Mutual: notices attempt to shortcut discovery by using administration materials produced under the Settlement	Court: Agreement permits independent discovery, but these notices impermissibly seek administration-derived/confidential materials from this case
Whether enforcing the Agreement would violate ethics rules or whether this court should defer to Texas/Massachusetts courts (comity)	Holmes: enforcement would violate Tenn. ethics rules and the Court should defer to other forums	Liberty Mutual: no ethics conflict; this Court retained jurisdiction and the other courts cannot access the sealed Agreement	Court: No ethics conflict; declines to defer—this Court retained enforcement jurisdiction and other courts lack access to the sealed Agreement

Key Cases Cited

Bamerilease Capital Corp. v. Nearburg, 958 F.2d 150 (6th Cir. 1992) (settlement agreements treated as contracts)
Baptist Physician Hosp. Org., Inc. v. Humana Military Healthcare Servs., Inc., 368 F.3d 894 (6th Cir. 2004) (clear contracts interpreted from the four corners)
Bokor v. Holder, 722 S.W.2d 676 (Tenn. Ct. App. 1986) (contract interpretation principles under Tennessee law)
In re Shumate, 39 B.R. 808 (Bankr. E.D. Tenn. 1984) (interpretation should give meaning to every provision)
RE/MAX Int'l Inc. v. Realty One, Inc., 271 F.3d 633 (6th Cir. 2001) (court retains jurisdiction to enforce settlements when judgment incorporates/retains jurisdiction)
Baugh v. Novak, 340 S.W.3d 372 (Tenn. 2011) (courts may invalidate private bargains on public-policy grounds only with great delicacy)