Opinion
No. 04 C 4475.
June 10, 2005
REPORT AND RECOMMENDATION
On May 16, 2005, I held an in-chambers conference to discuss resolution of Amtrak's motion to enforce oral settlement agreement. Pursuant to my earlier order, Amtrak's counsel, Ms. Allison Maki, prepared a written settlement agreement and release, which was to reflect the terms that the parties had orally agreed upon, as she understood them. At the conference, Mr. Alex, who was appearing pro se, Ms. Maki, and I reviewed line by line the written agreement. Paragraph 6, which Mr. Alex reviewed in the Court's presence, provided that Mr. Alex would not seek "reemployment or employment with Amtrak, its successors, assigns, parents, subsidiaries, divisions and affiliates." (Emphasis supplied).
Certain provisions of the agreement were objectionable to Mr. Alex, and it was agreed that some, at least, would either be revised or removed. Paragraph 6, however, was not one of them. Mr. Alex raised no objections to that paragraph. Thereafter, a revised written settlement reflecting the agreed upon changes was executed by Mr. Alex and by an appropriate representative of Amtrak. Paragraph 6 of the executed agreement contained the identical language Mr. Alex had approved on May 16, 2005. The District Court thereafter dismissed the case with leave to reinstate within 45 days if either of the parties had not performed.
On May 31, 2005, Mr. Alex sent an email to me, seeking to rescind the settlement agreement or correct paragraph 6 on the theory that prohibiting him from seeking employment with Amtrak's "successors, assigns, parents, subsidiaries, divisions and affiliates" was different than merely prohibiting him from seeking employment with Amtrak and would profoundly and adversely affect his chances for future employment. Mr. Alex did not dispute that he had approved the language of paragraph 6 on May 16, 2005 or that he had further agreed to it by executing the written settlement agreement.
On June 1, 2005, I wrote to Mr. Alex and Ms. Maki and told them I had no jurisdiction and that Mr. Alex needed to make application to the District Court. He did so with a subsequent email that sought to rescind the settlement agreement or change paragraph 6 so that textually it prohibited application for employment only with "Amtrak." The matter has been referred back to me for the performance of such additional duties as are not inconsistent with the Constitution and laws of the United States.
On June 10, 2005, I initiated a conference call with Ms. Maki and Mr. Alex to try to address Mr. Alex's concerns and to dispose of the motion. Mr. Alex reaffirmed that paragraph 6 was in the settlement agreement he had signed. Nonetheless, he insisted that by including in the scope of prohibited potential employers, Amtrak's "successors, assigns, parents, subsidiaries, divisions and affiliates," his chances for employment were significantly impaired. His belief was apparently based, in part, on the mistaken notion that the United States was the parent of Amtrak. He also had some concerns about his ability to seek employment in the railroad industry.
Ms. Maki represented that Amtrak had no parent company, three subsidiaries and two affiliates, and that none of the five had employees. The three subsidiaries, according to Ms. Make, are Chicago Union Station Company, Washington Terminal Company and Passenger Railroad Insurance, Ltd. The two affiliates are Penn Station Leasing and 30th Street Partnership. Ms. Maki assured Mr. Alex that other than these five entities, he was free to apply for employment to any other entity anywhere in the world without violating the settlement agreement. I explained to Mr. Alex that this interpretation was binding on Amtrak, and that he could feel comfortable in making application anywhere and to any prospective employer — including the United States and others in the railroad industry — other than the five entities specified by Ms. Maki.
Unmollified, Mr. Alex insisted that the agreement be changed since it would not adversely affect Amtrak. Ms. Maki refused, as she had the right to do, to prepare another agreement that excluded the phrase, "successors, assigns, parents, subsidiaries, divisions and affiliates." I told Mr. Alex that I would recommend to the District Court that his motion be denied, but that the order memorialize Ms. Maki's representations.
As a purely technical matter, Mr. Alex's motion is baseless. He knowingly and voluntarily signed a written settlement agreement that he had reviewed line by line, discussed line by line with Ms. Maki and me, and which he said he understood. In those instances in which he had questions, he asked them. In those instances in which he had objections, he raised them. Paragraph 6 engendered no disagreement by Mr. Alex. The agreement Mr. Alex signed contained the identical language in paragraph 6, that was contained in Ms. Maki's original draft.
Mr. Alex did not act under duress or from mistake. Indeed, the only mistake involved is Mr. Alex's present misapprehension about the inhibitory effect of paragraph 6. Finally, there is nothing unconscionable or even remotely disturbing about the paragraph. It contains the language customarily and routinely used in contractual provisions that prohibit a plaintiff from seeking reemployment with a defendant, and such provisions routinely appear in settlement agreements in cases such as that brought by Mr. Alex.
Although not strictly pertinent, since Mr. Alex's motion at least facially is an application that seeks to invoke the equitable powers of the Court, it should be noted that the deletion on which Mr. Alex insists would have no effect on his future job prospects. Paragraph 6 does no more than prohibit Mr. Alex from seeking employment from Amtrak — which he concedes is perfectly proper — and from five entities, none of which, as he conceded in our conference this afternoon, he had ever heard of, none of which have any employees, and none of which would be within the scope of his future employment efforts.
A settlement agreement is a contract and this is governed by principles of law applicable to contracts generally. Lumpkin v. Envirodyne Industries, Inc., 933 F.2d 449, 455 (7th Cir.), cert. denied, 502 U.S. 939 (1991). Parties to a settlement agreement, otherwise enforceable, cannot avoid the agreement merely because one of them has second thoughts, Taylor v. Gordon Flesch Co., 793 F.2d 858, 863 (7th Cir. 1986), or because the insisted upon change will not "hurt" the other party to the agreement. This principle is reflective of the more encompassing principle that since equity does not act to relieve parties of voluntarily undertaken obligations, in order to rescind a settlement agreement, the disgruntled party must demonstrate through clear and convincing evidence that the agreement was entered into as a result of fraud or mutual mistake. Cameron v. Bojusz, 305 Ill.App.3d 267, 271, 711 N.E.2d 1194, 1197 (1999); Melzer v. Bausch Lomb, Inc., 193 Ill.App.3d 59, 549 N.E.2d 817 (1989). Those factors are strikingly absent here.
Even preposterous terms are enforceable if that is what is actually intended. Beanstalk Group. Inc. v. AM General Corp., 283 F.3d 856 (7th Cir. 2002) (Posner, J.).
Settlement agreements are not subject to the rule of the "master brass door maker," who gets to tinker endlessly with his creation and only finishes when the door is wrenched from his clutches. See J. Cole, My Afternoon With Alex: An Interview With Judge Kozinski, 30 LITIGATION 6, 16 (Summer 2004). Neither the shortness of life nor the scarcity of judicial resources can countenance an approach to settlement agreements that makes them test runs, subject to revision whenever a party decides the agreement does not spell things out quite the way he would have liked. Mr. Alex's motion to rescind the settlement agreement should be denied.
Properly viewed, Mr. Alex's motion is to reinstate the case. It is of no moment that the request does not formally seek such relief, for the nature of a claim or request for relief is not a function of the title. See Whitaker v. Superior Court, 514 U.S. 208, 209 (1995). Compare United Airlines v. U.S. Bank, NA, ___ F.3d ___ (7th Cir. 2005) (Easterbrook, J.) (slip.op. No. 05-1871) ("Temporary restraining orders that extend past 20 days are reviewable as preliminary injunctions, no matter what the rendering judge may have called them.").