News & Insights

Settlement Agreements – Nondisclosure Provisions

By Paul Evelius

A recent Florida appellate decision illustrates the value of adding financial “teeth” to non-disclosure provisions in settlement agreements. In Gulliver Schools, Inc. v. Snay, a settlement agreement stated that the defendant school would pay a former teacher $90,000 to resolve the latter’s discrimination claim. It also prohibited the teacher from directly or indirectly disclosing the terms of the agreement to anyone other than his attorneys, professional advisors, and spouse and stated that, if he breached the non-disclosure obligation, he would forfeit $80,000 of the settlement amount.

Promptly after signing the agreement, the teacher expressed his satisfaction with the settlement to his daughter, who in turn stated, in a Facebook post, that her father had “won” the case against the school, which was “now officially paying for my vacation to Europe this summer.” The appellate court held that the teacher’s breach of the non-disclosure provision entitled the school to reduce its settlement payment by $80,000.