Re: Polgar's Latest Smokescreen

Ray Gordon, creator of the "pivot" wrote:
Settlement negotiations between counsel are protected by confidentiality to the extent that offers and representations are not admissible in court proceedings.

They are admissible, but can't be used to prove certain things.


A ground-breaking 2003 decision by the 6th Circuit created a new “settlement privilege” that protects settlement communications from discovery. In Goodyear Tire & Rubber Co. v. Chiles Power Supply, Inc.,1 the 6th Circuit found that the settlement privilege promotes the public policy underlying Rule 408: preserving the secrecy of settlement communications promotes settlements, which lessens the burden on the judicial system.

Goodyear Tire is a remarkable case. It stands as the only federal appellate court decision to recognize the settlement privilege. It also represents the rare occasion of a federal appellate court exercising its power to create a new privilege pursuant to Federal Rule of Evidence 501. Rule 501 authorizes federal courts to determine new privileges by examining “common law principles … in light of reason and experience.”

The 6th Circuit’s decision, however, stands in stark contrast against the majority of federal district courts that refuse to acknowledge the settlement privilege. According to these district courts, the only federal rule to address settlement materials, Rule 408, is a rule about admissibility and not discoverability. These courts also reason that settlement communications are necessarily discoverable — indeed, Rule 408 allows their use at trial for purposes other than proving the liability for or invalidity of the claim or its amount.

Competing Standards

While the majority of federal district courts do not recognize the settlement privilege, some district courts apply a stricter standard, requiring a “particularized showing” in determining whether to allow discovery of settlement communications. This higher standard is applied out of deference to the policy of promoting settlements underlying Rule 408. A frequently cited case is Bottaro v. Hatton Associates2 where the Eastern District of New York required a “particularized showing” of the likelihood that disclosure of settlement communications would lead to admissible evidence. http://www2.mnbar.org/benchandbar/2005/nov05/protesting_settlement.htm

At the state level there is something of a trend to prohibit use of settlement negotiations for any purpose, particularly if the negotiations took place during a mediation proceeding.
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