Sugar v. Greenburgh Eleven Union Free School District

Background

Judy Sugar sued Greenburgh Eleven Union Free School District and Elton Thompson, in his individual capacity, alleging violations of her First and Fourteenth Amendment rights related to the termination of her employment. The defendants filed a motion to enforce a settlement agreement. The motion and the settlement terms were filed under seal.

On March 25, 2019, Sugar and the defendants attended a settlement conference with Magistrate Judge Judith C. McCarthy and reached what the court described as a full settlement. Judge McCarthy stated the settlement terms on the record under seal. Sugar’s lawyer confirmed that the terms were accurate, and Judge McCarthy questioned Sugar about her understanding of the settlement. Sugar said that she understood and agreed to the terms.

Several months later, Sugar’s lawyer told the court that Sugar had instructed the lawyer that she would not sign or agree to the settlement agreement. The court later allowed Sugar’s lawyers to withdraw. The court extended Sugar’s deadlines to obtain new counsel and oppose the enforcement motion, warning that it could treat the motion as unopposed if she did not respond. Sugar did not oppose the motion by the extended deadline.

Legal standard

The court explained that a settlement agreement is a contract that becomes effective when the parties completely agree and intend to be bound. Under the Second Circuit’s four-factor test, the court considers whether the parties reserved the right not to be bound without a written agreement, whether they partially performed the agreement, whether they agreed to all material terms, and whether the type of contract is usually put in writing. No single factor controls.

A court may enforce an oral settlement agreement without a separate evidentiary hearing when there is no genuine dispute about a material fact. A party who agreed to an oral settlement cannot avoid it merely by refusing to sign a later written document memorializing the agreed terms.

Court’s analysis

The court found no genuine dispute about a material fact. It determined that the parties reached a meeting of the minds about the material settlement terms at the conference, understood those terms, and intended to be bound by them. The court also found that no party had reserved the right not to be bound without a written agreement and that the parties had partially performed some settlement terms.

The court therefore held that Sugar was bound by the oral settlement agreement reached on March 25, 2019. It stated that she could not withdraw from the agreement in order to renegotiate the terms or revive the claims she had agreed to resolve.

Disposition

The court GRANTED the defendants’ motion to enforce the settlement agreement.