Loose Lips Sink Ships… and Maybe Your Settlement Agreement

Loose Lips Sink ShipsMany personal injury cases settle, but it can take a lot of time and effort to reach a fair settlement agreement. After working hard to get a settlement in a personal injury case, your first instinct may be to run out in the street and shout your victory to the world – or perhaps just phone a friend and share the triumphant details.

If your settlement agreement includes a confidentiality provision, however, doing either of these things could make your settlement money disappear. If you have questions about settling a personal injury case, make sure to speak to a West Palm Beach personal injury attorney.

Tough Lessons about Confidentiality Clauses

Today’s culture is dominated by social media. People share all sorts of things, from the dinner they just ate to details about their daily workout. Most of us don’t think twice about broadcasting information about our lives to our online friends.

When information is part of a lawsuit, however, it is usually best to keep it between you and your lawyer. For one family, learning this lesson the hard way meant losing out on $80,000.

In 2014, a high school principal nearing his 70th birthday filed an age discrimination lawsuit against his school, claiming the administration had chosen not to renew his contract due to his age.

Fortunately for the principal, he settled the case out of court, receiving $80,000, plus $60,000 in attorney’s fees. The settlement is not what makes the case remarkable. Unfortunately, the remarkable part involves the story behind how the principal lost the $80,000.

Days after the principal and the school settled, the principal’s teenage daughter took to Facebook to announce to her 1,200 followers that her father had received a settlement and that the school district was “now officially paying for [her] vacation to Europe this summer.” She also included some rather colorful language – directed at the school district – at the end of her post.

Because the principal had signed a confidentiality clause as part of the settlement agreement, the school quickly notified him of the breach. Later, the school district successfully had the settlement rescinded for breach of the confidentiality clause.

Why Include a Confidentiality Clause in a Settlement Agreement?

Confidentiality clauses are extremely common in all kinds of settlement agreements, including those for personal injury cases.

When parties settle a case, the details of their settlement, along with any agreements, are not entered into the court record. The settlement agreement itself is a private matter between the parties, and most settlement agreements specify that the parties are not to discuss the terms of the settlement with anyone but their lawyers and perhaps their professional advisers, such as a financial adviser.

There are many reasons why the parties, and especially the defendant, may wish to keep the details of their settlement away from public scrutiny.

For high-profile defendants, such as large corporations with big assets, confidentiality clauses prevent so-called “copycat lawsuits.”

For defendants who operate businesses, confidentiality clauses can also help protect their reputation and rapport with their customers.

If the thought of losing $80,000 over a single Facebook post makes you sick to your stomach, you’re certainly not alone.

If any good can come of the principal’s story, it’s a compelling cautionary tale of the importance of taking a confidentiality clause very seriously.

If you receive money in a settlement, and you sign an agreement to keep the details private, remember to keep it to yourself and your lawyer.

West Palm Beach Personal Injury Law Firm

Do you have questions about a personal injury matter? Contact a West Palm Beach personal injury lawyer today to schedule a free consultation.

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