Dismissed with prejudice in settlement - only two of four expressly agreed to release claims

Asked over 4 years ago - New York, NY

I recently settled a case in a New York Federal District Court. The complaint named four defendants. The four defendants were represented by counsel. I was pro se.

The settlement was mediated by the judge. Two of the four defendants appeared at settlement conference. The settlement agreement by express terms only released claims as to those two that appeared. The attorney that represented the parties made no mention of the other two defendants during the settlement conference and the judge never asked if the attorney would do a similar mutual release for the remaining two defendants. The complaint was dismissed with prejudice subject to the settlement agreement.

Are any viable claims against the two remaining defendants that did not appear dismissed with prejudice?

Attorney answers (2)

  1. Matthew Bryant

    Contributor Level 13

    Answered . It is possible that you have preserved claims against the two "remaining" defendants, but it is also possible that the claims are barred. It really depends on what the terms of the settlement and discontinuance are.

    Ideally, in your situation the plaintiff would either reserve his or her rights or carve out non-released claims and discontinue without prejudice to make your intent clear. If you settled against two defendants and agreed to withdraw the complaint with prejudice against all four, however, technically that could amount to a waiver. When you re-file against the other two defendants, they could use the settlement agreement and prejudicial withdrawal as a basis for a motion to dismiss. Your best argument to oppose that motion is: (1) the settlement is not a resolution on the merits against the non-appearing defendants and therefore has no preclusive effect; and (2) you were acting pro se and did not knowingly waive your claims by virtue of a settlement agreement with other parties.

    There are two caveats to this analysis. First, it depends on the relationship between the defendants. A settlement with defendant "A" bar claims against defendant "B" if defendants "A" and "B" are in "privity of contract" with each other such as agent and principal or employer and employee or simply are doing business with each other in some cases.

    Second, depending on the facts of the case, however, the types of claims and severity of injuries, I would also generally caution that while pro se litigants are given a little lattitude in technical latters, they neverthless very frequently end up abusing that lattitude by filing, and re-filing, suing, and re-suing over the same claims because they didn't like the result or they are not ready to move on personally. I'm not suggesting that is the case here at all, but law suits are public filings and everything filed in federal court is accessible online. Even if you don't want to pay an attorney to handle the claim, I suggest you get counsel to review your claims and settlement agreement to get sound advice on how, and if, to proceed.

  2. Susan Pernick

    Contributor Level 15

    Answered . I agree with what Mr. Bryant wrote, but I'd like to add an additional caveat: if the claims against all four defendants were dismissed with prejudice, suing the non-appearing defendants again could cause sanctions and legal fees to be assessed against you. That is another reason to have an attorney review the settlement to see where you stand against the two defendants who were not parties to the settlement.

    Proceed carefully. If you were fully compensated by the two defendants who appeared at the settlement conference, I'd let it go.

    DISCLAIMER - THIS IS NOT LEGAL ADVICE. IT IS MEANT SOLELY FOR GENERAL INFORMATIONAL PURPOSES, AND NO ATTORNEY-CLIENT RELATIONSHIP IS HEREBY CREATED.

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