Settlement Agreement and Release (Federal)

This form is a settlement agreement and release that may be used in a federal district court case. It contains drafting notes and optional clauses

When drafting or reviewing the agreement, try to address all the issues about the settlement terms and eliminate any ambiguity. For example, specify deadlines for making settlement payments. The agreement should list the rights, claims, obligations, or interests that will be released in the settlement as well as any claims or obligations that are not part of the settlement.

SETTLEMENT AGREEMENT AND RELEASE

RECITALS

This Confidential Settlement Agreement and Release (“Settlement Agreement”) is made as of this _____ day of [month], [year] by and between [plaintiff] (“Plaintiff”), and [defendant] (“Defendant”) (each a “Party” and collectively the “Parties”)

RECITALS

WHEREAS, on or about [date] Plaintiff commenced a civil action against Defendant captioned [case name] in the United States District Court for the [court name], No. [docket number] (the “Litigation”);

WHEREAS, Defendant asserted certain defenses [and counterclaims] against Plaintiff;

WHEREAS, the Parties to the Litigation have agreed to amicably resolve and settle the claims and defenses in the Litigation; and

WHEREAS, the Parties wish to memorialize the terms of their agreement and to do so in this document; and

WHEREAS, the Parties acknowledge that they are entering into this Settlement Agreement voluntarily and after consultation with counsel of their choosing;

NOW, THEREFORE, for good and valuable consideration, the receipt, adequacy, and sufficiency of which is hereby acknowledged, and intending to be legally bound, the Parties agree as follows:

1. Recitals. The foregoing Recitals are expressly incorporated as part of the Settlement Agreement, and the Parties confirm and represent to one another that said Recitals are true and correct to the best of their knowledge, information, and belief.
2. No Admission of Liability. It is expressly understood that this Settlement Agreement and the settlement it represents are entered into solely for the purpose of allowing the Parties to avoid further litigation. This Settlement Agreement does not constitute an admission by either Party of any wrongdoing, contractual obligation, or of any duty whatsoever, whether based in statute, regulation, common law, or otherwise, and each Party expressly denies that any liability or any such violation has occurred.
3. Terms of Settlement. In consideration for the Plaintiff’s release of claims and execution of this Settlement Agreement, and in exchange for the promises, waivers, and releases set forth in this Settlement Agreement, the Defendant agrees to pay by [identify manner of payment] to the Plaintiff’s counsel in the amount of $ [amount] (the “Settlement Payment”), less applicable withholdings and deductions, for which the Defendant shall issue a Form W-2. The Parties agree that the payment constitutes full compensation for all of the Plaintiff’s claims, including, but not limited to, [insert claims]. The Parties acknowledge and agree that they are solely responsible for paying any attorney’s fees and costs incurred in the Litigation and that neither Party nor its attorneys will seek any award of attorney’s fees or costs from the other Party, except as expressly provided herein.
4. Tax Consequences. The Parties make no representations regarding the Settlement Agreement’s tax consequences. Each Party agrees that it will not assert a claim against the other Party for the payment or reimbursement of any tax consequences resulting from any payment made pursuant to this Settlement Agreement.
5. Sufficient Consideration; Release of Claims.The Parties acknowledge that the consideration provided to the Plaintiff under this Settlement Agreement is sufficient. In consideration for the payments herein provided, Plaintiff, to the maximum extent permitted by law, hereby irrevocably and unconditionally releases and discharges Defendant and its past or present predecessors, parents, subsidiaries, affiliates, successors, assigns, officers, directors, shareholders, attorneys, and employees, and any related or affiliated corporations or entities, and their past or present predecessors, parents, subsidiaries, affiliates, successors, assigns, officers, directors, shareholders, attorneys, and employees, and any person or entity acting through or in concert with any of the preceding persons or entities (all of the preceding persons and entities, severally and in the aggregate, will be referred to as Releasees) from any and all actions, claims, demands, debts, reckonings, contracts, agreements, covenants, damages, judgments, executions, liabilities, appeals, obligations, attorney’s fees, and causes of action from the beginning of time to the date of this Settlement Agreement, known or unknown, asserted or unasserted, including but not limited to all claims arising under [insert all potential grounds for the plaintiff’s claims](except as excluded below), emotional distress, punitive damages, or attorney’s fees and costs, and any and all other claims arising under any law, rule, regulation, order or decision.

   Excluded from this release are:

   • Claims that cannot be waived by law
   • Claims for enforcement of this Settlement Agreement
   • [Insert other claims that cannot be waived]
   • [Insert other claims that the parties have agreed will not be waived]
6. No Other Pending Claims. Plaintiff agrees and represents that it has no other pending legal actions or claims against Defendant, including in any court, arbitration forum, governmental or administrative forum or agency, or other dispute resolution forum that are in any way related to the Litigation or dispute described herein.
7. Dismissal of Litigation. Within [number] days after receipt of the Settlement Payment, Plaintiff and its counsel shall take any necessary actions to ensure that the Litigation is dismissed in its entirety, with prejudice and without costs or fees. Defendant will cooperate with Plaintiff in securing the dismissal of the Litigation as appropriate.
8. Confidentiality. The Plaintiff agrees that this Settlement Agreement, as well as the nature and terms of this settlement and the subject matter thereof, will be forever treated as confidential and the Plaintiff shall make no disclosure or reference to the terms of this Settlement Agreement to any person or entity, except to the Plaintiff’s attorneys, members of Plaintiff’s immediate family and, as necessary, tax preparers, provided that each such person agrees to be bound by the confidential nature of this Settlement Agreement. The Plaintiff and the Plaintiff’s counsel may also make such disclosures pursuant to court or administrative order, subpoena, or as otherwise may be required by law. The Plaintiff acknowledges and agrees that Plaintiff’s promise to maintain the confidentiality of the Settlement Agreement is an important element of the consideration for and inducement of the Defendant to enter into this Settlement Agreement. The Plaintiff further agrees that the Plaintiff’s breach of this Settlement Agreement’s confidentiality clause constitutes irreparable harm to the Defendant. In the event of an actual or threatened confidentiality breach, the Plaintiff consents to a temporary restraining order, preliminary injunction, and/or permanent injunction prohibiting commission or continuation of any actual or threatened breach. Nothing in this Settlement Agreement shall preclude the Plaintiff from stating, in response to any inquiry, that this dispute has been resolved by mutual Settlement Agreement and to the mutual satisfaction of the Parties, but it is expressly agreed that the Plaintiff shall make no further comment.
9. Non-disparagement. Each Party agrees that it shall not disparage the other Party, or any present or former officer, director, agent, or employee of either Party, whether to any current or former employee of either Party, the press or other media, or any other business entity or third party.
10. Attorney’s Fees. Should any Party bring an action to enforce or interpret this Settlement Agreement, the prevailing party shall be entitled to an award of reasonable attorney’s fees, in addition to any other relief to which the prevailing party may be entitled.
11. Entire Agreement. This Settlement Agreement comprises the entire agreement between the Parties and supersedes any and all prior oral and written agreements between them. This Settlement Agreement may not be altered, amended, or modified except by a further writing signed by the Parties.
12. Severability. If any of the provisions, terms, or clauses of this Settlement Agreement are declared illegal, unenforceable, or ineffective by an authority of competent jurisdiction, those provisions, terms, and clauses shall be deemed severable, such that all other provisions, terms, and clauses of this Settlement Agreement shall remain valid and binding upon both Parties.
13. Choice of Law. The validity and construction of this Settlement Agreement shall be governed by the laws of [jurisdiction], without regard to the principles of conflicts of laws. Any action to enforce this Settlement Agreement shall be brought only in [court].
14. Severability. A court’s ruling rendering any provision(s) of this Settlement Agreement invalid or unenforceable shall not affect the validity of the remaining provisions of this Settlement Agreement.
15. No Interpretation of Ambiguity Against the Drafter. This Settlement Agreement has been negotiated and prepared by both Parties and their counsel. If any of the Settlement Agreement’s provisions require a court’s interpretation, no ambiguity found in this Settlement Agreement shall be construed against the drafter.
16. Opportunity to Consult Legal Counsel. The Parties confirm that they have reviewed and considered this Settlement Agreement and consulted with their attorneys regarding the terms and effect thereof.
17. Authority to Settle. Each Party represents and warrants that the person signing this Settlement Agreement has authority to bind the Party and enter into the Settlement Agreement.
18. Counterparts. This Settlement Agreement may be executed in two or more identical counterparts, all of which constitute one and the same Settlement Agreement. Facsimile or other electronically-transmitted signatures on this Settlement Agreement shall be deemed to have the same force and effect as original signatures.

IN WITNESS WHEREOF, and intending to be legally bound, the Parties hereto have caused this Settlement Agreement to be executed as of the date(s) set forth below.

On Behalf of Defendant:

By: ____________________________________________

Printed Name: ___________________________________

Title: ___________________________________________

Dated: _________________________________________

On Behalf of Plaintiffs: _____________________________

By: ____________________________________________

Printed Name: ___________________________________

Title: ___________________________________________

Dated: _________________________________________

Form provided by James M. Wagstaffe, a renowned author, litigator, educator, and lecturer, and the premier industry authority on pretrial federal civil procedure. He is a partner and co-founder of Kerr & Wagstaffe LLP, where he heads the firm’s Federal Practice Group. See his full bio here: https://www.lexisnexis.com/en-us/practice-advisor-authors/profiles/james-wagstaffe.page.

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