Did Herman Cain Breach a Confidential Settlement Agreement?
Maybe. Over the past several days, the media reported that two female employees accused presidential candidate Herman Cain of sexual harassment while he was the head of the National Restaurant Association in the 1990s. Both of the incidents reportedly ended with settlement agreements that contained confidentiality provisions. After the reports surfaced, Cain denied the allegations against him and suggested that one of the reports was based on a comment he made about a woman’s height.
Because the settlement agreements have not been released, there is no definitive answer to whether Cain’s comments to the media resulted in a breach of the confidential settlement agreements. Whether a breach occurred depends on a number of factors, the most important of which is the language of the settlement agreements. Factors that may influence the answer include the following:
- Was Cain a party to the agreement? If the settlement agreements were only between the National Restaurant Association and the women who accused Cain, there may be an argument that Cain is not bound by the confidentiality provisions. On the other hand, the confidentiality provisions may apply to Cain as a representative of the Association.
- What was the scope of the confidentiality provisions? The confidentiality provisions may be broad enough to prohibit any discussion of the cases at all, or they may be narrowly drawn to only prohibit discussion of the amount of the settlement. Alternatively, a confidentiality provision may specify what each party can say about the case if asked.
- Who breached the confidentiality provisions first? If one of the women who accused Cain breached the confidentiality agreement by talking to the media first, Cain might be able to argue that he was justified in publicly discussing the case. If Cain was the first one to talk to the media, however, his accusers may be able to assert this argument against him.
Takeaway for Employers: Without seeing the agreements and knowing all of the facts, it is impossible to determine whether Herman Cain breached any confidentiality provisions in the settlement agreements. At the same time, it is certain that this is a situation that most employers (and presidential candidates) would prefer to avoid. Therefore, it is important for any employer who agrees to a confidential settlement to understand who is bound by the confidentiality provision and what information must be kept confidential. Employers should also make sure that employees and representatives of the company who are subject to a confidentiality agreement understand their obligations.