by John Darer CLU ChFC MSSC CeFT RSP CLTC
Parties to a settlement should consider the possibility that a copy of a confidential Settlement Agreement may be uploaded to a state court's online portal as exhibits to petitions for structured settlement transfers submitted to State courts and address accordingly.
In a New York transfer submission that appeared online through a public online portal, the entire Settlement Agreement and Release was online exhibit with all its terms as "naked" as they day they were scribed. In another there was an attempt to redact in some places, but the redactions relating to the Defendants were poor and incomplete. I couldn't help but thinking, suppose there is a confidentiality provision, and the payee has the obligation to keep the terms confidential. Now the payee, by virtue an attempt to sell payments has caused the Defendants to lose the benefit of the bargain.
Are There Consequences to Breach of Confidentiality?
Even a mistaken breach of a confidentiality provision can lead to damages, whether the breach is a result of the conduct of the client or the attorney. Therefore, many attorneys discuss with their clients the importance in complying with the confidentiality provisions of the settlement agreement, particularly in the age of social media. In situations where a large number of client representatives have knowledge of a settlement, it may be advisable to incorporate terms into the agreement whereby only a disclosure of particular detailed settlement terms can be deemed a violation of the agreement. Otherwise, upon a breach, the breaching party could be required to return any settlement proceeds or to pay other damages.
Because proof of damages for breach of confidentiality tends to be difficult, settlement agreements may specify remedies including monetary liquidated damages, injunctive relief, costs and/or attorneys’ fees. Source Shhhh: Complying with Confidentiality Clauses in Settlement Agreements Dentons.com