Opinion
Case No. 1:19-cv-629
2021-02-09
Monica F. JACKSON, Plaintiff, v. GENERAL ELECTRIC AVIATION, Defendant.
Sean L. Walton, Jr., Walton Brown, LLP, Columbus, OH, Carla D. Aikens, Pro Hac Vice, Detroit, MI, Robert Alan Steinberg, Robert Steinberg Co., LPA, Terrence Lee Goodman, Law Office of Terrence L. Goodman, LLC, Cincinnati, OH, for Plaintiff. Kasey L. Bond, Melanie Cheek, Keating Muething & Klekamp PLL, Cincinnati, OH, for Defendant.
Sean L. Walton, Jr., Walton Brown, LLP, Columbus, OH, Carla D. Aikens, Pro Hac Vice, Detroit, MI, Robert Alan Steinberg, Robert Steinberg Co., LPA, Terrence Lee Goodman, Law Office of Terrence L. Goodman, LLC, Cincinnati, OH, for Plaintiff.
Kasey L. Bond, Melanie Cheek, Keating Muething & Klekamp PLL, Cincinnati, OH, for Defendant.
OPINION AND ORDER
DOUGLAS R. COLE, UNITED STATES DISTRICT JUDGE
This case is in a unique procedural posture. The defendant, General Electric ("GE"), claims this matter settled at the end of a mediation that occurred in January 2020. In July 2020, GE filed a motion (Doc. 29) seeking to enforce what it considers to be a binding settlement agreement. The plaintiff, Monica Jackson, claims that is not the case. After initial briefing on GE's motion, the Court held an in-camera virtual evidentiary hearing on October 29, 2020, and received supplemental briefing from the parties in December 2020. For the reasons set forth below, the Court finds that the parties did arrive at an oral settlement agreement at the mediation, but that this agreement took the form of an option contract that expressly provided Jackson up to twenty-one days to decide whether to accept the actual settlement agreement. Jackson's subsequent actions show that she did not exercise that option. Accordingly, the Court holds there is currently no binding settlement, and thus DENIES GE's motion.
Because this matter involves an effort to enforce a purported settlement agreement that includes confidential terms, the Court held the evidentiary hearing in camera, and ordered some of the material in the briefing to be filed under seal. In this Opinion and Order, the Court endeavors not to include reference to any material that is confidential. That being said, out of an abundance of caution, the Court is filing this Opinion and Order under temporary seal. Any party that believes that any portion of this Opinion and Order should be redacted shall have leave until February 19, 2021, to file a brief specifically identifying the portions that the party contends should be permanently sealed, and explaining why such a seal is warranted under Sixth Circuit standards.
The Court further notes, however, that it entered an Order on January 27, 2020, after the Magistrate Judge reported the parties had settled the matter at mediation, in which it dismissed this action with prejudice, but provided any party forty-five days leave to move to reopen for good cause. No party objected to that Order. And the specified time expired on March 12, 2020, with no party requesting that the matter be reopened. Thus, the matter remains closed on the Court's docket.
The Court is aware that yesterday, on February 8, 2021, Jackson filed a Motion to Set Aside Judgment Pursuant to Fed. R. Civ. P. 60(b)(4) or 60(b)(6) (Doc. 50). GE has not yet had an opportunity to respond to that Motion. The Court will address that Motion in a later decision, once fully briefed.
BACKGROUND
On July 30, 2019, Jackson, who was then a senior manager at GE, sued her employer. (Doc. 1). In her Complaint, she alleged that GE engaged in racial discrimination when it failed to promote her to "Executive Band level," even though it promoted "similarly situated Caucasian employees to that level." (Id. , #1). Based on this alleged mistreatment, Jackson asserted a claim under 42 U.S.C. §§ 2000e et seq. and 42 U.S.C. § 1981. (Id. , #15–16). She also asserted a separate count for breach of contract, alleging that her original offer letter from GE was a contract that she had accepted, and that GE's conduct toward her, including its failure to promote her to Executive Band, violated the duty of good faith and fair dealing inherent in that contract. (Id. , #16). She sought equitable relief, as well as compensatory damages, punitive damages, and attorneys’ fees. (Id. , #17–18).
About three months into the case, and about a week after the parties filed their joint report under Fed. R. Civ. P. 26(f), the Judge then assigned to the matter referred the case to a Magistrate Judge to schedule a settlement conference. After that Magistrate Judge recused, the matter was referred to Magistrate Judge Bowman, who set the matter for a mediation on January 23, 2020. After the mediation was scheduled, but before it occurred, the matter was transferred to the undersigned Judge.
On the appointed date, the parties engaged in a full day of mediation that culminated in what appeared to be a settlement. The parties were not able to prepare definitive documents that day, though, as some minor terms and specific language remained in need of additional discussion. To avoid any confusion, the parties put the material terms of the settlement on the record before the Magistrate Judge.
The transcript shows that the Magistrate Judge began by noting that the parties had started from "[a] draft settlement agreement [that] was prepared by [counsel for GE] and circulated to plaintiff's counsel." (Settlement Hr'g Tr., Doc. 18, #192). "That agreement," she stated, "will be the basis ... moving forward for the agreement, with a couple minor modifications and additions." (Id. ).
This Court refers to that draft agreement in this Opinion as the "Template Agreement." While many of the terms are confidential, the Court need not disclose the substance of those terms here. Suffice it to say that, as with most settlement agreements, the Template Agreement addressed and identified the claims that Jackson was releasing, as well as the consideration that she would receive from GE in exchange for that release. The Template Agreement also contains, however, a provision that features prominently in the Court's discussion below. That provision expressly states that the agreement would not become binding until Jackson had a further opportunity to review it. Specifically, in Paragraph 4(e) of the Template Agreement, she "acknowledges and agrees" that GE "has given her at least twenty-one (21) days to consider her decision to enter this Agreement," and that she "has the right to revoke this Agreement at any time within seven (7) days after she signs it." The Template Agreement also included a choice of law provision specifying Ohio law.
After referencing the Template Agreement as the starting point, the Magistrate Judge then specifically identified the "minor modification and additions" to that agreement to which the parties had also consented. These included, for example, the specifics of terms relating to things such as non-disparagement, confidentiality, the use of alternative dispute resolution for disputes arising under the agreement, terms relating to the specifics of Jackson's resignation, and how the settlement payment to her would be characterized. (Settlement Hr'g Tr., Doc. 18, #192–194). After the Magistrate Judge described these modifications, counsel for GE then offered some further clarifications on the record regarding those additional terms.
After the Magistrate Judge had spelled out all of the "minor modifications and additions," and after GE had offered its clarifications on the record, the Magistrate Judge then inquired of plaintiff's counsel whether the record correctly reflected the parties’ agreement:
The Court: All right. Mr. Steinberg, with those clarifications, does that still meet with your approval as to what we agreed to?
Mr. Steinberg: Yes, Your Honor.
(Id. , #194). She then posed the same question to GE's counsel:
The Court: Ms. Bond, do you have anything else?
Ms. Bond: No, Your Honor. We're agreeing that is correct.
(Id. , #194–95). She also directed the same question to the parties themselves, starting with Jackson:
The Court: Okay. Then, Ms. Jackson, do you agree to the terms as I have set forth on the record today.
Ms. Jackson: Yes, Your Honor.
(Id. , #195). And finally, she inquired of GE:
The Court: And then who is going to agree for GE?
Mr. Kates: Darryl Kates.
The Court: All right. And you agree as well?
Mr. Kates: Yes.
(Id. ).
With all of the material terms, and everyone's agreement, expressly stated on the record, the Magistrate Judge concluded the mediation. She then put a Minute Entry on the docket stating "Matter resolved," and noting that she was requesting the "District Judge to enter a 45 day conditional dismissal with the Court to retain jurisdiction to enforce [the settlement agreement]." (1/23/20 Min. Entry). That was late on a Thursday evening. The next afternoon, the Magistrate Judge contacted this Court's chambers to advise that the matter had settled, and to request the Court to enter a conditional dismissal.
On Monday, January 27, 2020, the Court entered that Order. As the parties had requested, it provides that "this action is hereby DISMISSED with prejudice , provided that any of the parties may, upon good cause shown, within 45 days, reopen the action if settlement is not consummated." (Doc. 16). Under that Order, the parties had until March 12, 2020, to notify the Court if either of them believed that good cause existed to reopen the matter. No party has ever indicated that the Court entered the Order in error.
On February 28, 2020, GE asked for a copy of the transcript, referenced above, prepared at the close of the mediation. GE did not indicate why it sought the transcript. The Clerk's Office provided the transcript on March 9, 2020. (Doc. 18 (sealed)).
So far, so good, but then things took a turn. In early April, Jackson's counsel contacted the Court, seeking permission to file under seal a motion relating to the settlement. Counsel provided a copy of the motion for in camera review. That filing notified the Court of difficulties that Jackson's counsel had encountered in terms of getting Jackson to actually execute the settlement agreement. As the filing suggested that counsel may have a developed a conflict with their client, the Court set the matter for a telephonic status conference, inviting Jackson herself to join, along with all counsel on the matter. Before that conference occurred, Jackson requested additional time to identify new counsel, which the Court granted. Shortly thereafter, new counsel appeared on her behalf.
The status conference took place on June 17, 2020. At the conference, GE maintained that the agreement reached at the mediation was binding and enforceable, and said it planned to file a motion to enforce. Jackson, represented by new counsel, disagreed that the matter had settled. The principal area of dispute appeared to involve a bonus for the work that Jackson had performed in 2019. Jackson claimed that her understanding was that the amount of payment set forth in the settlement agreement did not include that bonus, or that, in other words, she still remained entitled to her bonus for 2019 in addition to the payment under the settlement agreement. GE insisted that was not the case, but that instead the amount in the settlement agreement was the entirety of what GE owed Jackson, inclusive of any bonus for 2019. Jackson further claimed that, given this disagreement on an essential term of the settlement agreement, there was no enforceable agreement between the parties.
With the parties apparently at an impasse on the matter, GE filed its motion to enforce on July 15, 2020. (Doc. 29). In its motion, GE sought to have the settlement agreement enforced according to GE's understanding. GE also sought as damages for Jackson's breach of that settlement agreement the attorneys’ fees that GE had incurred, and was incurring, in enforcing the settlement agreement. (Id. ). The parties fully briefed that motion, (see Docs. 37 and 38), and they requested that the Court schedule an in camera evidentiary hearing. (See 9/2/2020 Minute Entry; 9/3/2020 Notation Order).
The Court held a telephonic hearing to schedule the requested evidentiary hearing. At that conference, the parties discussed who would testify. Both parties expressly waived the mediation privilege so that the mediator could do so. The Court set the matter for hearing on October 29, 2020, and set a calendar for the pre-hearing exchange of witness lists and exhibits. At that hearing, the Magistrate Judge testified, along with Jackson, a GE witness, and Jackson's former counsel. Everyone, with the exception of Jackson, testified that the payment set forth in the mediated settlement agreement was inclusive of all amounts that GE would pay Jackson. Both the mediator and Jackson's former counsel testified that the mediator had explained this to Jackson before Jackson acquiesced to the terms of the agreement. GE also put on evidence of the attorneys’ fees it had incurred after the date of the (alleged) settlement and leading up to the hearing. On February 8, 2021, GE supplemented that attorneys’ fee information.
Following the hearing, the Court requested post-hearing briefing relating to a specific issue that arose there. In particular, pointing to the language from the Template Agreement regarding the right to review and revoke, the Court noted at the hearing that the "binding agreement" reached at the mediation appeared to include a term that provided Jackson time to review and decide whether to execute the agreement, along with another term that gave her the ability to revoke the agreement even after she signed it. The Court asked the parties to address the impact of those terms on the current enforceability of the agreement against Jackson. The parties completed the requested briefing on that issue on December 24, 2020.
The matter is currently pending before the Court.
LAW AND ANALYSIS
Under Ohio law, as a general matter, oral agreements to settle cases are valid and enforceable. And, GE is correct that if a party continues to litigate a matter in breach of such an agreement, the attorneys’ fees the other side incurs in enforcing the settlement agreement are typically recoverable as compensatory damages. Here, though, while the Court agrees with GE that the parties had an agreement at the culmination of their mediation, the Court concludes that the terms of that agreement do not provide a basis for the relief that GE seeks.
A. Under Ohio Law Oral Agreements To Settle A Case Are Enforceable, But Only According To Their Terms.
1. The Parties Had A Meeting Of The Minds On The Essential Terms Of The Agreement, Which Did Not Leave Jackson A Separate Right To Receive A Bonus For 2019.
It is undisputed that the mediated agreement that GE seeks to enforce includes a choice of law provision that specifies Ohio law. GE is correct that "Ohio law favors the resolution of disputes and the prevention of litigation through compromise and settlement." (Doc. 29, #244 (citing State ex rel. Wright v. Weyandt , 50 Ohio St.2d 194, 363 N.E.2d 1387 (1977) ; Weckel v. Cole + Russell Architects , 994 N.E.2d 885 (Ohio Ct. App. 2013) )). And, while "[i]t is preferable that a settlement be memorialized in writing," "an oral settlement agreement may be enforceable if there is sufficient particularity to form a binding contract." Kostelnik v. Helper , 96 Ohio St.3d 1, 770 N.E.2d 58, 61 (2002).
In terms of the requisite level of particularity required for enforcement, Kostelnik offers the following guidance:
A contract is generally defined as a promise, or a set of promises, actionable upon breach. Essential elements of a contract include an offer, acceptance, contractual capacity, consideration (the bargained for legal benefit and/or detriment), a manifestation of mutual assent and legality of object and of consideration. A meeting of the minds as to the essential terms of the contract is a requirement to enforcing the contract.
To constitute a valid settlement agreement, the terms of the agreement must be reasonably certain and clear, and if there is uncertainty as to the terms then the court should hold a hearing to determine if an enforceable settlement exists. However, all agreements have some degree of indefiniteness and some degree of uncertainty. In spite of its defects, language renders a practical service. In spite of ignorance as to the language they speak and write, with resulting error and misunderstanding, people must be held to the promises they make.
Id. , 770 N.E.2d at 61–62 (emphasis added and cleaned up) (citation and quotation omitted). In sum, if the parties have a meeting of the minds as to the "essential terms," a settlement agreement exists, and the Court may enforce it.
Here, there is little question that the parties had a meeting of the minds following the mediation. The transcript from the proceeding confirms that. The Magistrate Judge carefully laid out all of the essential terms. In particular, the record shows that the parties’ agreement consisted of the Template Agreement, coupled with "minor modifications and additions," each of which the Magistrate Judge identified on the record. To be sure, the parties understood that drafting the specific language on some of those modifications and additions may take some negotiation, but the "essential terms" were definitively settled, and the parties expressly admitted as much on the record at the mediation. None of the testimony from the hearing changes that result. Everyone understood that further negotiation would occur, but the overwhelming weight of the evidence shows that whether the parties had an agreement was no longer open for debate.
That conclusion applies with full force to the disputed issue here. Having heard the evidence, the Court concludes that the agreement the parties contemplated at the mediation did not provide for separate payment from GE to Jackson for any 2019 bonus. Rather, the payment specified in the agreement was the entirety of any amount that GE would pay. While Jackson claims she did not have that understanding, the Court finds the testimony from the mediator and Jackson's own former counsel more credible on that issue. In light of their testimony regarding the conversation that occurred at the mediation, it would have been objectively unreasonable for Jackson to believe that she still had an entitlement to further payment for that bonus in addition to the settlement amount. Thus, the Court finds that GE is correct that the mediated settlement included all of the essential terms, and that the compensation term in the agreement was inclusive of any right Jackson may have had to a bonus.
2. Because The Mediated Agreement Provided Jackson Twenty-One Days To Review Before Signing, She Is Not In Breach Of A Settlement Agreement.
While the parties reached an agreement, deciding whether Jackson breached that agreement (or whether there is currently anything for GE to enforce) requires a closer examination of some of the agreement's other terms. Ohio law is clear that "if the language of a contract is plain and unambiguous, [courts must] enforce the terms as written, and ... may not turn to evidence outside the four corners of the contract to alter its meaning." Beverage Holdings, L.L.C. v. 5701 Lombardo, L.L.C. , 159 Ohio St.3d 194, 150 N.E.3d 28, 31–32 (2019) (citations omitted). And, "[w]hen considering the language of a particular contractual provision, common words will be given their ordinary meaning unless manifest absurdity results or unless some other meaning is clear from the face or overall contents of the agreement." Id. (internal citations and quotations omitted).
Here, the undisputed facts show that the "plain and unambiguous" terms of the "agreement" in fact made it more of an "option contract." Under Ohio law, "[a]n option contract consists of two independent elements: (1) an offer to buy, sell, or perform some act, which becomes a contract if properly accepted; and (2) the binding agreement to leave the offer open for a specified period of time." Shrock v. Spognardi , 46 N.E.3d 1115, 1120 (Ohio Ct. App. 2015). The plain language of the mediated agreement shows that is what happened here. The Template Agreement that formed "the basis" for the mediated agreement expressly stated that the parties agreed that GE would give Jackson twenty-one days to review the agreement before deciding to execute it. To be sure, there may be questions, given the lack of separate consideration from Jackson to GE as payment for the promise to keep the offer open, as to whether GE may have had the right to walk away from the deal during that period. See, e.g., Stonecreek Properties Ltd. v. Ravenna Sav. Bank , No. 2002-P-0129, 2004 WL 1559725, *6 (July 9, 2004 Ohio Ct. App.) (noting that, as a general matter, option contracts must be supported by consideration). But the Court need not answer that question, as GE did not seek to do so.
So, coming out of the mediation, the agreement's plain language suggests two things were to happen: (1) Jackson would have a twenty-one-day window within which to sign the agreement, thereby creating a permanent enforceable settlement agreement; and (2) even after signing, she would have a right to revoke for seven days. In other words, the parties had an option contract. And the undisputed facts show that Jackson never subsequently manifested to GE an intent to execute her right to create the second contract during that time. Accordingly, as a straightforward matter of contract law, the option contract between GE and Jackson lapsed with no further contract formed.
3. GE Argues That The Twenty-One-Day Review Period Does Not Matter, But The Precedent On Which It Relies Is Inapposite.
The Court noted at the evidentiary hearing the potential problem the contractual provision created on this score, and invited further briefing on the matter. In that briefing, GE argues for a different result, based largely on the recent Seventh Circuit decision in Harmon v. Wis. Reg'l Training P'ship, 833 Fed.Appx. 1 (7th Cir. 2020). According to GE, that case likewise involved a settlement agreement with a provision that offered the plaintiff an opportunity to review and revoke. The plaintiff there sent notice to the court seeking to exercise that right. The court nonetheless found, however, that the settlement agreement was enforceable, and that the plaintiff was unable to revoke it. According to GE, the same result should follow here.
The Court disagrees. GE's argument fails to account for a significant factual difference between Harmon and this matter. In particular, in Harmon , the review-and-revoke provision was not included in the terms announced at the mediation itself, but rather made its first appearance in a draft agreement that defense counsel circulated after the mediation had concluded (a draft agreement that the employee refused to sign). The Seventh Circuit thus noted, as GE points out, that in Harmon , "the right to revoke derives from the [ADEA], not the parties’ contract." (GE Br., Doc. 46, #479, (quoting Harmon , 833 Fed.Appx. at 4 )). But that hurts GE's argument here, rather than helping as GE contends. Because the draft agreement in Harmon did not include the language as a result of the parties agreeing to it at the mediation, the parties could not rely on contract law as the basis for enforcing the term. Rather, the provision could be enforced, if at all, only as a matter of the ADEA statute itself. As there was no ADEA claim, the statute did not apply. In sum, in Harmon , the plaintiff was essentially trying to rely on a new term, to which the parties had not agreed, to vitiate the oral settlement, to which the parties had agreed. The court, perhaps not surprisingly, said "No."
Every similar case the Court has located likewise involved a situation where: (1) the mediated settlement agreement at issue did not include the review-period provision; (2) in a later draft the employer unilaterally included it; (3) the employee refused to sign that written agreement; but (4) the employee nonetheless later tried to rely on that new provision to escape enforcement of a mediated settlement agreement that did not include the provision. See, e.g., Walters v. Wal-Mart Stores, Inc. , 703 F.3d 1167, 1173 (10th Cir. 2013) (noting that "[a]lthough the ‘Settlement Terms’ document does not reference such, the final agreement includes a ‘Twenty–One Day Consideration Period’ to consider and accept the terms," and rejecting employee's attempt to rely on that consideration period); Roscoe v. Watco Companies, LLC , No. 15-CV-2118, 2018 WL 8345101, at *10 (E.D. Pa. Nov. 9, 2018), report and recommendation adopted, No. CV 15-2118, 2019 WL 2211855 (E.D. Pa. May 20, 2019) (noting that the "written contract is clear and unequivocal and does not include any term mentioning a right to consider the agreement for 21 days of receipt," and rejecting attempt to rely on such a term that later appeared in the unsigned "formal written agreement") (quotation omitted); Crawford v. Nat'l Honorary Beta Club , No. 7:14-CV-02970-GRA, 2015 WL 12806590, at *2 (D.S.C. Oct. 8, 2015) (same situation). Indeed, in Crawford , the court referred to the question of "whether the terms of the oral settlement ... included an ability to revoke acceptance within seven days," as "the overarching question." Crawford , 2015 WL 12806590, at *2.
Here, that "overarching question" has a different answer than in every one of the cases cited above. The Template Agreement that served as "the basis" for the parties’ settlement agreement at the mediation expressly included the review-and-revoke provision. And that provision was not exclusively tied to the ADEA. To be sure, in the section that includes the review-and-revoke provision, the Template Agreement refers to that statute, stating that Jackson's "waiver of rights under this Agreement is knowing and voluntary and complies in full with all criteria set forth in the regulations of the Age Discrimination in Employment Act and the Older Workers Benefit Protection Act." But the remainder of that provision makes no further reference to those statutes, and it certainly does not expressly tie to those statutes Jackson's entitlement to "at least twenty-one (21) days to consider her decision to enter into this Agreement" or seven days to revoke it after signing. In short, here, right from the outset, the mediated settlement agreement itself included the review-and-revoke provision.
That means that the current facts differ from Harmon (and the other cases cited above) in two important and related ways. First, the review-and-revoke provision here was expressly included in the mediated agreement, unlike in Harmon where the defendant sought to add it after the mediation. And second, that in turn means that the provision here is enforceable as a matter of contract law , and not merely as a prescriptive statutory add-on under the ADEA. Because contract law makes the provision enforceable, the fact that, as in Harmon , Jackson has no ADEA claim (and thus cannot rely on that statute as a source of enforcing the review-and-revoke provision) is simply not relevant. Thus, Harmon offers little guidance here.
In sum, the fundamental problem GE faces is that the mediated agreement, by its express terms, amounted to an option contract, and GE has not shown that Jackson ever subsequently manifested an intent to execute her rights under that contract. To the contrary, as GE notes, despite repeated emails and communications between counsel, it was clear that Jackson was withholding her consent. Thus, by its own terms, the option contract lapsed with no contract between the parties.
GE also offers an additional argument under the option-contract approach, but that argument likewise falls short. In particular, GE notes that the twenty-one-day review period under the ADEA is waivable—that is, the employer must provide twenty-one days, but the employee can accept the agreement before that time expires. GE argues that the correct understanding of the review-and-revoke provisions on the facts here is that, when Jackson "accepted" the agreement at the end of the mediation, that was akin to "signing" it, meaning that Jackson had voluntarily terminated her twenty-one-day review period, and began her seven-day revocation period. Because she did not revoke within that time, GE continues, the agreement is binding.
That is perhaps a plausible reading of the Template Agreement, but the Court rejects it here for two reasons. First, it is, at best, a strained reading. The parties had just arrived at the agreement during the mediation itself, so a term saying that GE "has given her at least twenty-one (21) days to consider her decision whether to enter the agreement" certainly suggests that the period is still to come. And the plain language provides that the revocation period is triggered by Jackson "sign[ing]" the document. "Signing" suggests something akin to "affixing your name in writing." The Court could imagine that the act of acquiescing on the record in open court could substitute for "signing," but if that is to be the case for something as important as triggering the end of a review period and the start of a revocation period, that would require at least some explanation to Jackson of that fact—especially given that the agreement's plain language suggests a different result. Yet, it does not appear that any such explanation occurred here. Thus, the better reading of the plain language is the one the Court sets forth above.
Second, to the extent that there is ambiguity regarding whether the review period continued after the mediation, the Court finds that the ambiguity should be construed in favor of preserving Jackson's ability to exercise her rights to review and revoke the agreement. GE, after all, is the party that drafted the Template Agreement, so any residual ambiguity should be construed against it. See, e.g., Becker v. Direct Energy, LP , 112 N.E.3d 978, 991 (Ohio App. 2018) ("Ohio law is settled that ambiguities in contracts are construed strictly against the drafter.") (citing cases). That is especially true when dealing with rights as important as the right to review and revoke an agreement. GE drafted what appears to be an option contract, but now wants the Court to ignore that optionality. The Court declines to do so.
The Court acknowledges that this is likely a "secondary rule" of contract interpretation under Ohio law, that "comes into play only when an ambiguity remains after a court has looked to extrinsic evidence." Beverage Holdings, L.L.C. v. 5701 Lombardo, L.L.C. , 159 Ohio St. 3d 194, 210 n.3, 150 N.E.3d 28 (Ohio 2019) (DeWine, J., dissenting). Here, though, the Court is not relying on the rule to resolve contractual ambiguity in Jackson's favor, but rather as confirmation that the Court should not go out of its way to find ambiguity to resolve in GE's favor. The bottom line is that the plain language suggests that Jackson had twenty-one days in which to decide whether to execute the final settlement agreement, and the Court sees no reason to deviate from that plain language reading here.
Indeed, had GE wanted to be clear and unambiguous about avoiding an option contract structure, it could have done so. As GE notes, Jackson had not made an ADEA claim in this case, so there was no need to include an ADEA-mandated review-and-revoke approach in this settlement agreement at all. And, in any event, "the twenty-one day provision does not apply to the settlement of a court case," even one involving an ADEA claim. Walters , 703 F.3d at 1173 (citing 29 U.S.C. 626(f)(2) ). Moreover, the ADEA/Older Workers Benefit Protection Act ("OWBPA") review-and-revoke periods do not apply to other types of claims, like the Title VII claim that Jackson pressed here. So, had GE wanted merely to cover its bases with regard to unasserted but potentially available claims under the ADEA or OWBPA, it could have limited the review-and-revoke provisions only to claims under those statutes (e.g., "Jackson will have twenty-one days in which to review her decision to release any ADEA or OWBPA claims, but the release will nonetheless be binding as to any other claims," or some such carve-out approach).
GE chose none of these. Rather, it drafted what is by all appearances an option contract. GE must abide by the agreement as drafted, just as Jackson must.
4. The Doctrine of Laches Does not Require Jackson to Accept the Agreement.
GE next argues that, even aside from Harmon , Jackson is "barred from now seeking to revoke the settlement because of laches." (GE Br., Doc. 46, #481). GE contends that Jackson's "undue delay in executing the written agreement, and by extension, her delay in exercising any alleged right to revoke her signature until well after GE had started performing on the parties’ agreement, prevent Plaintiff from invoking revocation as a defense to her contractual obligations to GE." (Id. ). "The elements of laches are (1) unreasonable delay or lapse of time in asserting a right, (2) absence of an excuse for such a delay, (3) knowledge—actual or constructive—of the injury or wrong, and (4) prejudice to the other party." Martin Marietta Magnesia Specialties, L.L.C. v. Public Utilities Comm'n , 129 Ohio St.3d 485, 954 N.E.2d 104, 114 (2011). GE's argument fails right from the outset because GE cannot show that Jackson unreasonably delayed asserting any right. That largely follows from the Court's analysis above. The offeree in an option contract is not typically required to affirmatively reject the offeror's firm offer. See, e.g. , Kenney v. Chesapeake , 31 N.E.3d 136, 141 (Ohio Ct. App. 2015) ("[A]n option contract involves an offer to perform an act and a binding agreement to leave the offer open for a particular period, which does not become a contract until accepted. ") (emphasis added). Rather, the offeree's failure to accept the offer by a particular time constitutes a rejection of the offer at that time. Indeed, the lack of any affirmative obligation to reject means it makes little sense to view the offeree's failure to accept as the exercise of any right. If anything, the offeree's failure to accept constitutes a forfeiture of a right—the right to accept the offer. And that probably explains why, in Ohio cases involving option contracts, laches issues seem to arise only when the offeree seeks to accept the offer after some delay. See, e.g. , Sugarhill Ltd. v. Brezo , 2005 Ohio App. LEXIS 1811, * 6 (Ohio Ct. App. April 22, 2005); Cottrell v. Stuller , 2001 WL 227438, at *2, 2001 Ohio App. LEXIS 1033, at *13 (Ohio Ct. App. Mar. 5, 2001) ; Bahner's Auto Parts v. Bahner , Case No. 97CA2538, 1998 WL 470494, at *4-5, 1998 Ohio App. LEXIS 3453, at *14 (Ohio Ct. App. June 23, 1998).
Jackson had no affirmative obligation to reject GE's offer. Rather, the contract gave her twenty-one days to decide whether to accept the offer. Only if she executed the agreement was she then under an affirmative obligation to revoke the settlement within seven days if she changed her mind. But, as explained above, Jackson never accepted GE's offer. She thus did not unreasonably delay in asserting any contractual right.
5. GE Is Not Entitled To Recover Attorneys’ Fees For Its Efforts To Enforce The Alleged Settlement Agreement.
The absence of an enforceable settlement agreement has two consequences of note for this case. The first involves GE's claim for attorneys’ fees. Given the lack of a currently enforceable settlement agreement between the parties, GE cannot recover the attorneys’ fees it incurred in its enforcement efforts. To be sure, GE is correct that, under Ohio law, if a party finds it necessary to sue to enforce a settlement agreement, such damages may be in order. (GE Mot., Doc. 29, #247 (citing Rayco Mfg. v. Murphy, Rogers, Sloss & Gambel , 142 N.E.3d 1267 (Ohio Ct. App. 2019) (internal citations omitted))). But, here, as described above, because of the review-and-revoke provision, the parties ultimately had no such agreement, and thus GE has not suffered any compensatory damages as a result of its efforts to enforce that non-existent contract.
6. Even Absent A Settlement Agreement, The Case Nonetheless Remains Dismissed With Prejudice.
The remaining consequence involves the current status of this case. As noted, following the report of a successful mediation, the Court entered a conditional dismissal Order giving the parties a specific amount of time (forty-five days) in which to request that the Court reopen the matter if the parties could not finalize settlement. No one contacted the Court during that time. So, as things stand now, the matter remains closed and the claims dismissed with prejudice.
The use of conditional dismissals is standard practice in the Southern District of Ohio for cases in which the parties report that they settled their dispute through mediation. The idea is that a conditional dismissal will allow the parties a set amount of time to consummate their already reported settlement. If unforeseen problems arise during efforts to finalize the settlement during that time (as it appears they did here), either party can ask the Court to withdraw its Order dismissing the case, and to reinstate the matter to the active docket, assuming that the party can establish good cause.
Importantly, the specified time period is not an open-ended invitation to revoke an otherwise-valid settlement agreement. Only if the party seeking to re-open the matter can show good cause does the Court withdraw its Order.
Here, as noted, the Court entered just such an Order on January 27, 2020. Consistent with the typical use of such Orders, that Order expressly provided that that "this action is hereby DISMISSED with prejudice , provided that any of the parties may, upon good cause shown, within 45 days, reopen the action if settlement is not consummated." (Doc. 16). As the quoted language reflects, that Order dismissed the claims here with prejudice, but allowed either party to seek to undo that dismissal if the parties, for good cause, could not finalize settlement. As a result of the Order, the Clerk's Office closed the case that day.
The forty-five-day period specified in the Order ended on March 12, 2020. As noted above, no party moved for relief from the Order until yesterday when Jackson filed a Rule 60 Motion (Doc. 50), nearly eleven months after the forty-five-day period ended. Even in her Opposition to GE's Motion to Enforce, which Jackson filed in August 2020, some five months after the date specified in the conditional dismissal, Jackson merely mentioned in passing a request for the Court to reinstate the matter. And in doing so, she did not cite any legal authority or "good cause" supporting that proposed course of action. Rather, her principal request at that time was for the Court to "instruct the parties to complete negotiation of all material terms." (Jackson Resp. Br., Doc. 38, #438). Jackson, however, identified no legal authority that would allow the Court to force GE to negotiate further, and the Court knows of none. In any event, the Order, which was final as of January 27, 2020, remains in place today. That Order dismissed the claims in the lawsuit with prejudice, and thus this matter remains closed. That being said, the Court will address Jackson's now-filed Rule 60(b) Motion once it is fully briefed.
CONCLUSION
For the above-stated reasons, the Court DENIES GE's Motion to Enforce Settlement Agreement (Doc. 29). This matter remains closed on the Court's docket.