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DILLARD v. STARCON INTERNATIONAL

December 2, 2005.

JAMES DILLARD, Plaintiff
v.
STARCON INTERNATIONAL, INC., Defendant.



The opinion of the court was delivered by: ARLANDER KEYS, Magistrate Judge

MEMORANDUM OPINION AND ORDER

Currently before the Court is Defendant Starcon International, Inc.'s ("Starcon") Motion to Enforce an Oral Settlement Agreement against Plaintiff, James Dillard. Mr. Dillard filed suit against Starcon, claiming that he was the victim of racial discrimination and harassment, in violation of Title VII of the Civil Rights Act and 42 U.S.C. § 1981 (West 2005). Following discovery, the parties engaged in settlement negotiations. Starcon contends that those discussions resulted in an enforceable oral agreement. For the reasons set forth below, this Court grants Defendant's Motion to Enforce the Oral Settlement Agreement. BACKGROUND FACTS

Mr. Dillard began working for Starcon on April 18, 1996, as a mechanic. Mr. Dillard alleges that, during his seven year employment with Starcon, he was subjected to harassment and racial epithets. After he was terminated on August 15, 2003, Mr. Dillard filed a Charge of Discrimination with both the Illinois Department of Human Rights and the United States Equal Employment Opportunity Commission ("EEOC"). The EEOC investigated the Charge, and issued Mr. Dillard a Right to Sue letter in October of 2003. Mr. Dillard filed suit against Starcon on December 30, 2003.

  Oral Negotiations

  Discovery in the matter was scheduled to conclude on March 31, 2005. Between March 17, 2005 and March 20, 2005, the parties engaged in oral settlement negotiations. At the conclusion of these negotiations, both parties agreed that Mr. Dillard would release Starcon from liability in exchange for a monetary payment and Starcon's promise to reinstate his employment.

  On March 17, 2005, Starcon's counsel initiated settlement discussions with Mr. Dillard's attorney. (Pl.'s Mem. Opp. Pg. 3). Starcon offered Mr. Dillard a $40,000 cash payment and reinstatement of his employment as a "B Welder;" subject to him passing the B Welder's test. (D.'s Mem. Pg.2). Counsel explained that Mr. Dillard must respond to the offer by the close of business on Monday, March 21, 2005, in order for Starcon to save on the costs of further depositions of Starcon witnesses, which were scheduled for that week. On March 18, 2005, Mr. Dillard responded with a counter offer, demanding that Starcon reinstate him as a "C Welder," while allowing him two opportunities to pass the "B Welder" test. Mr. Dillard also insisted that Starcon: (1) pay for his training and retesting; (2) pay him $75,000 in damages; and (3) reinstate him in the Chicagoland area.

  Starcon agreed to pay for Mr. Dillard's training, provided that he maintain a "B" average, and to provide Mr. Dillard with two opportunities to take and pass the "B Welder" test. In addition, Starcon would reinstate Mr. Dillard as an "A Mechanic," because the "C Welder" position no longer existed, and would reinstate him in the Chicagoland area, provided he remain flexible about working in other locations as work demanded. But, Starcon agreed to pay Mr. Dillard only $45,000 in cash.

  Mr. Dillard's counsel concedes that she informed defense counsel that Starcon's reemployment terms, including his reinstatement as an "A Mechanic," earning $22.35 an hour,*fn1 were acceptable. See Decl. Of Sallie Smylie. However, Mr. Dillard rejected Starcon's $45,000 cash offer, and demanded $65,000 instead. Later the same day, Starcon upped its cash offer to $50,000, and insisted that Mr. Dillard accept or reject its offer by 10:00 pm an Sunday, March 20, 2005.

  On March 20, 2005, Mr. Dillard rejected Starcon's offer of $50,000, and countered at $65,000 firm. Starcon relented, finally agreeing to Mr. Dillard's demand for a $65,000 cash payment. Counsel for Starcon agreed to write the initial draft of the agreement.(Pl.'s Mem. Opp. Pg. 4).

  Written Drafts of the Settlement Agreement

  On March 23, 2005, Starcon faxed the first draft of the settlement agreement to Mr. Dillard. Starcon's draft included a provision stating that Mr. Dillard would be an at-will employee and, therefore, subject to termination by Starcon "for any or no reason, without notice." (D's Mem., Exhibit #2, Pq #2, ¶ 7). Mr. Dillard's counsel responded on March 25, 2005, calling Starcon's draft "the most one-sided, overreaching agreements she had ever seen, and that she could not advise Mr. Dillard to accept the settlement as drafted." Pl.'s Opp. at p. 6. Mr. Dillard focused on three areas of critical disagreement: 1) that the release, nondisparagement, and confidentiality provisions be mutual, and not unilateral, provisions; 2) that Mr. Dillard could be terminated only for "just cause";*fn2 and 3) that Mr. Dillard could not agree to various provisions obligating him as an employee.*fn3

  Mr. Dillard sent Starcon two different drafts of his response, deleting, revising, and adding a number of provisions. First, Mr. Dillard inserted a provision stating that, upon reinstatement of his employment, he could be terminated for just cause only, and he deleted Starcon's "at-will" provision.*fn4 (Pl's Mem., Exhibit D, Pg #4, ¶ 5).

  Next, Mr. Dillard deleted a portion of provision 11, which stated that, "In the event that Starcon's Releases are made a party to, or otherwise involved in, any dispute regarding Dillard's discharge of that responsibility, Dillard hereby agrees to indemnify, save and hold harmless Starcon's Releases from any loss or liabilities resulting from his discharge of, or failure to discharge." (Pl's Mem. Opp., Exhibit D, Pg 5, ¶ 11).

  Finally, Mr. Dillard deleted a portion of the provision regarding his cash payment. Specifically, Mr. Dillard deleted the following language: "It is understood and agreed to by Dillard that the Settlement Funds include both: all compensation that Dillard claimed or claims that he was owed; and, an additional amount of money in excess of $1.00 that is consideration for execution of this Agreement. Dillard affirms that he is entitled to no further relief than the amount specified herein, and that he would not be entitled to receive the ...


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