Hendrickson et al v. ABC Insurance Company et al

Filing 37

DECISION AND ORDER signed by Chief Judge William C Griesbach on 12/17/2018 Granting 29 Motion to Seal and Denying 31 Motion to Enforce Confidential Settlement Agreement. The Clerk is directed to set the matter on the court's calendar for further scheduling. (cc: all counsel) (Griesbach, William)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN

LAWRENCE K. HENDRICKSON,
Plaintiff,
and
UNITED HEALTHCARE OF WISCONSIN, INC.
Involuntary Plaintiff,
v.

Case No. 17-C-1680

WAL-MART STORES INC.,
PARTNERS IN ARKANSAS GEN. MANITOWOC,
ABC INSURANCE COMPANY, and
DEF INSURANCE COMPANY,
Defendants.

DECISION AND ORDER

Plaintiff Lawrence K. Hendrickson filed this action against Defendants Wal-Mart Stores Inc.
and Partners in Arkansas Gen. Manitowoc in Manitowoc County Circuit Court asserting claims of
general negligence and a violation of Wisconsin’s Safe Place Statute as a result of falling in a WalMart parking lot. Wal-Mart removed the case to federal court based on diversity jurisdiction. On
September 11, 2018, counsel for Wal-Mart filed a letter with the court, confirming that the parties
agreed upon a confidential resolution and indicating that the parties would file a stipulation and order
for dismissal. ECF No. 24. On September 17, 2018, Hendrickson contacted the Clerk’s office,
indicating that he did not authorize a settlement in this case. Presently before the court is WalMart’s motion to enforce the settlement agreement. Wal-Mart requests that the court enforce the

settlement agreed to between the parties, order Hendrickson to sign the written confidential
settlement agreement, and dismiss Hendrickson’s complaint in its entirety. Hendrickson did not
respond to the motion, and his time to do so has passed, so this matter is ripe for ruling. For the
following reasons, the motion will be denied.
ANALYSIS
“State contract law governs issues concerning the formation, construction, and enforcement
of settlement agreements.” Beverly v. Abbott Labs., 817 F.3d 328, 333 (7th Cir. 2016). In this case,
the settlement agreement is governed by Wisconsin law. Under Wisconsin law, a settlement
agreement is not binding “unless made in court . . . and entered in the minutes or recorded by the
reporter, or made in writing and subscribed by the party to be bound thereby or the party’s attorney.”
Wis. Stat. § 807.05. This statute is an “exception to the normal rule that oral contracts are binding.
Section 807.05 adds requirements for enforceability of an otherwise valid agreement when the
agreement is reached in the course of a claim that is in the process of adjudication.” Kocinski v.
Home Ins. Co., 154 Wis. 2d 56, 67, 452 N.W.2d 360 (1990). The purpose of the statute is to
“prevent disputes and uncertainties as to what was agreed upon.” Adelmeyer v. WEPCO, 135 Wis.
2d 367, 372, 400 N.W.2d 473 (Ct. App. 1986) (citation omitted).
Wal-Mart maintains that Hendrickson is bound by the settlement agreement because his
counsel agreed to the terms of the agreement. Wal-Mart maintains that, after the parties were unable
to reach a resolution at a mediation held on August 23, 2018, Hendrickson contacted his attorney
and expressed that he would resolve his lawsuit if he received a certain sum of compensation in
exchange for resolution or dismissal of the lawsuit. With that information, plaintiff’s counsel and
defendant’s counsel engaged in settlement discussions over the telephone, which culminated in an
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agreement. Defendant’s counsel transmitted a written settlement agreement and taxation documents
to plaintiff’s counsel for execution via e-mail. Plaintiff’s counsel did not respond to that e-mail.
Defendant’s counsel subsequently notified the court, with plaintiff’s counsel’s authorization, that the
parties had reached a resolution. Wal-Mart contends that the conduct of plaintiff’s counsel is
sufficient to establish that a binding settlement agreement exists.
Although plaintiff’s counsel orally represented an agreement to the terms of the settlement,
the material terms were never “clearly accepted in a writing subscribed by the party to be bound or
that party’s attorney.” In re Estate of Johnson, 2006 WI App 19, ¶ 7 n.4, 289 Wis. 2d 100, 709
N.W.2d 88. Counsel’s oral representations are insufficient to constitute a binding settlement
agreement. In this case, the parties contemplated that the settlement agreement would be executed
when the parties signed the agreement. The settlement agreement provides that the effective date
of the agreement is “the date Plaintiff signs the Agreement” and is not executed until signed by the
plaintiff. ECF No. 33-1 at 2, 13. Because Hendrickson never signed the agreement, it was never
executed, and the parties are therefore not bound by it. See Lambert Corp. v. Evans, 575 F.2d 132,
135 (7th Cir. 1978) (“Even if parties agree, point by point, on all the terms of a contract, if they
understand that the execution of a formal document shall be a prerequisite to their being bound there
is no contract until the document is executed.” (citing Peninsular Carpets, Inc. v. Bradley Homes,
Inc., 206 N.W.2d 408, 412 (Wis. 1973))). Accordingly, Wal-Mart’s motion to enforce the
settlement agreement is denied.
Wal-Mart has also filed a motion to restrict its motion to enforce, its brief in support of the
motion to enforce, the declaration of Attorney Nelson W. Phillips, III, and the confidential settlement
agreement. A motion to seal “should be limited to that portion of the material necessary to protect
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the movant from the harm that may result from disclosure.” Comment to General L.R. 79 (E.D.
Wis.). In order to show good cause to restrict a document, the party requesting protection must
“analyze in detail, document by document, the propriety of secrecy, providing reasons and legal
citations.” Baxter Int’l, Inc. v. Abbott Labs., 297 F.3d 544, 548 (7th Cir. 2002). Neither bare
assertions of confidentiality nor the agreement of the parties is sufficient to warrant restricting
documents from the public.
I am satisfied that good cause exists to restrict the settlement agreement based on the fact
that confidentiality of settlement agreements encourages and promotes the public interests inherent
in the settlement of lawsuits. The motion to seal the motion to enforce, the supporting brief, and the
declaration, however, will be denied without prejudice. Entire pleadings and briefs should not be
sealed absent unusual circumstances. See Union Oil Co. of Cal. v. Leavell, 220 F.3d 562, 567 (7th
Cir. 2000) (“[T]he parties’ confidentiality agreement cannot require a court to hide a whole case
from view.”). Wal-Mart has not provided an independent factual basis to establish good cause for
sealing these documents. To the extent the motion, brief, and declaration contain confidential
information, that information may be redacted with a separate request to seal the portions containing
confidential material.
CONCLUSION
For the foregoing reasons, Wal-Mart’s motion to enforce the confidential settlement
agreement (ECF No. 31) is DENIED and its motion to seal documents (ECF No. 29) is GRANTED
as to the settlement agreement (ECF Nos. 29-4; 33-1), which will remain restricted. The motion to
seal is DENIED without prejudice as to Wal-Mart’s motion to enforce and brief in support of the
motion as well as the declaration of Attorney Nelson Phillips (ECF Nos. 29-1; 29-2; 29-3; 31–33),
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and the Clerk is directed to remove the restriction from these documents. The Clerk is directed to
set the matter on the court’s calendar for further scheduling.
SO ORDERED this 17th day of December, 2018.
s/ William C. Griesbach
William C. Griesbach, Chief Judge
United States District Court

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