In Gulliver Schools, Inc., et al. v. Snay, the Third Circuit Court of Appeal (Florida) held that an employee's disclosure to his daughter of the existence of his settlement with his former employer constituted a breach of the confidentiality clause of the settlement agreement.
Patrick Snay sued Gulliver for age discrimination and retaliation. Thereafter, the parties entered into a settlement agreement, which had a confidentiality clause specifically prohibiting Snay from discussing with any entity or person (except his attorneys, other professional advisors, or his spouse) any information regarding the "existence or terms" of the agreement. The penalty for breach of this provision was disgorgement of Snay's portion of the settlement payments.
After signing the settlement agreement, Snay and his wife told their college-age daughter that the case was settled and that they were happy with the result. Snay's daughter then posted the following message on her Facebook page: "Mama and Papa Snay won the case against Gulliver. Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT." At the time, she had around 1,200 Facebook friends. Many of them were current or former Gulliver students.
Upon discovering this message, Gulliver refused to pay Snay $80,000 under the settlement agreement, claiming that he had breached the confidentiality clause by disclosing the existence of the settlement to his daughter. The appellate court found in Gulliver's favor. It held that Snay violated the confidentiality clause based on the plain language of the settlement agreement and it pointed out that he could have negotiated the confidentiality clause to allow him to disclose the settlement to his daughter, but did not.
Employers should be mindful of their own discussions with and disclosures to others surrounding settlement agreements since even minor disclosures can violate confidentiality provisions.
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