Lawsuit settlement reform. No No Fault and NDAs

Some recent public incidents and articles about settlements have started me thinking about the problems with the current system. What seems to happen with virtually every civil legal case is that the parties come to an out of court settlement. The hallmark is that the defendant admits no liability/fault, the plaintiff gets some money, and both parties are under a gag order and/or non-disclosure agreement. This has two negative public policy implications:

(1) The public is unaware that a person or organization is victimizing/harming others

To use a recent example, if I see that Bill Cosby has settled a lawsuit with a victim I don’t know if he’s dangerous or simply taking the path that costs him the least amount of money. This allowed him to continue victimizing people.

(2) It looks like extortion instead of justice

If Cosby is paying someone to go away, instead of compensating for actual damage, then the court system becomes an extortion system. Essentially, the case becomes “Give me X or spend 3X on lawyers”. That’s not what the courts should be used for, and giving into extortion makes it more likely that others will be victimized.

To address these, I propose that in order to settle a lawsuit the settlement agreement must:

(1) Provide an agreed set of facts and the amount the suit is settled for. Each claim in the suit should be included and it should state whether the claim is true or not.

(2) The agreement is placed into the public record

(3) No non-disclosure, gag order, or other similar agreements

I’ll go on record as saying NDA’s are pretty much bullshit.

Absolutely. I will never agree to one and I’m unsure how they pass constitutional muster.

I wholeheartedly agree with the OP. If we want to keep something like plea deals, we need to make them abbreviated trials, complete with public records, standards of evidence and the ability to appeal.

My goal would be to eliminate them entirely, though. If the justice system can’t function without plea deals, we either need more funding for the courts or fewer laws. I’m leaning towards the latter. There are, by at least an order of magnitude, too many laws.

I don’t get the disdain for NDAs.

They obviously pass constitutional muster, just as NDAs in private industry do. If you sign a paper agreeing not to disclose information, that’s a contractual thing. It’s voluntary. Where’s the beef?

In lawsuits, they have the advantage of minimizing press coverage, protecting people’s reputations. I sue you for peeing on my rose bushes; you agree to settle out of court, with the provision that I don’t tell anybody. Makes sense: it’s embarrassing, and you wouldn’t want it widely known. Since I’m not vindictive, I agree to the NDA.

Who’s harmed?

The beef comes in when the government enforces it. It’s clearly an infringement on free speech. If my employer says I’ll get fired if I talk, that’s one thing. If the government says I’ll be fined or imprisoned for saying something, that’s quite another.

The people harmed are those who are forced into an NDA for various reasons. Such as the threat of being deported if you don’t sign one, or not being able to feed your family. Or for that matter, not being able to obtain financial restitution from the person who raped you if you don’t sign one. And then preventing the admission of rape from coming to light even after dozens more victims spoke up.

Who is harmed is anyone who wishes to speak freely. Turning it around, who is harmed by the elimination of NDAs? The occasional bush-pisser?

What if it’s fraud instead of rose bush peeing? Then the people who are harmed are the other victims of the fraud. They might not know they were victims of fraud or will have to reprove claims. There may be future victims as well who will be caught unaware.

The second point is what are you settling for? If it’s for damage done to your rose bush, fine. If it’s to shut you up then it becomes extortion. We don’t allow extortion as a matter of public policy, and we certainly don’t want the legal system to become involved in that.

But the government isn’t punishing you for speaking, it’s punishing you for violating a contract. If contracts limiting what a person is allowed to say are illegal, how do corporations protect trade secrets?

That’s how I see it, too. It’s part of a voluntary deal. You sign the agreement. Okay, you signed it, and now you’re bound by it, like any other contractual agreement. You can reject it, and the lawsuit continues in the ordinary fashion.

Okay, yeah, I can see the point. But I don’t think it’s so bad a thing that it needs to be removed by legislation from judicial options. It’s one tool in the toolbox. The judge probably is aware of this as an issue, and might very well refuse to accept an NDA for fraud. Why take it away from him in every possible situation?

(I’m less sure about no-fault, but I really like the no-fault option when it comes to divorce. Imagine if every divorce had to be fully litigated. Awful! No-fault, too, I think, should remain as an option on the table, to be used when appropriate.)

I’d also like to throw doctors and lawyers into the mix. If my doctor violates my medical confidentiality, and runs around telling everyone about my enormous genital warts, I should not have any legal recourse against him?