Pierce v. F.R. Tripler & Co., 955 F.2d 820

U.S. Court of Appeals

1992

Chapter

8

Title

A Return to Relevance I:  Limits Based on Policy

Page

356

Topic

A job offer made as a compromise is not admissible

Quick Notes

o         Pierce filed against Tripler on the basis of age discrimination for failure to promote him to a general manager position.  The Df attorney called the Pl - attorney and offered Pierce a financial position at their other subsidiary.  The Df the offer to be admissible.

Rule 408. Compromise and Offers to Compromise

         (a) Prohibited Uses - Evidence of the following is not admissible on behalf of any party, when offered to prove liability for, invalidity of, or amount of a claim that was disputed as to validity or amount, or to impeach through a prior inconsistent statement or contradiction:

o    (1) furnishing or offering or promising to furnish or accepting or offering or promising to accept a valuable consideration in compromising or attempting to compromise the claim ; and

o    (2) Conduct or statements made in compromise negotiations regarding the claim, except when offered in a criminal case and the negotiations related to a claim by a public office or agency in the exercise of regulatory, investigative, or enforcement authority.

         (b) Permitted uses. This rule does not require exclusion if the evidence is offered for purposes not prohibited by subdivision (a). Examples of permissible purposes include proving a witness's bias or prejudice ; negating a contention of undue delay; and proving an effort to obstruct a criminal investigation or prosecution.

Court There are consequences

o         If substance of negotiations were admissible at trial, many attorneys would be forced to testify as to the nature of the discussions that thus be disqualified as trial counsel.

o         No lawyer in a law firm would attend a negotiation session.

Court Holding

o         Even where the evidence offered favors the settling party and is objected to by a party not involved in the settlement, Rule 408 bars admission of such evidence unless it is admissible for a purpose other than 'to prove liability for or invalidity of the claim or its amount

Book Name

Evidence: A Contemporary Approach.  Sydney Beckman, Susan Crump, Fred Galves.  ISBN:  978-0-314-19105-2.

Issue

o         Whether a discussion after a claim has been filed is barred by FRE 408?  Yes.

Procedure

Trial

o         The United States District Court for the Southern District of New York in favor of plaintiff former employee, in an age discrimination action

Appellant

o         Affirmed

Facts

Discussion

Key Phrases

Rules

Pl - Pierce

Df - F.R. Tripler & Co

Description

o         Pierce filed against Tripler on the basis of age discrimination for failure to promote him to a general manager position.

o         Pierced file a claim with the Employment Opportunity Commission alleging age discrimination.

o         The Df attorney called the Pl - attorney and offered Pierce a financial position at their other subsidiary.

o         Pierces attorney tried to get confirmation if the position was offered in exchange for release of the claim.  After several confusion communications between the two attorneys, Pierce then initiated a lawsuit.

Df Argued We offered Pierced a subsequent job offer

Pierce Argued This offer took place in the course of settlement negotiations and thus was inadmissible under FRE 408.

Court Not admissible.

o         The offer was not unambiguously unconditional.

In order to show a failure to mitigate damages

o         The Evidence of the failure must first be admissible

o         Evidence that demonstrates a failure to mitigate damages goes to the "amount" of the claim and thus, if the offer was made in the course of compromise negotiations, it is barred under the plain language of Rule 408.

Court Judge used FRE 104(a) to determine admissibility of evidence

o         Under Fed. R. Evid. 104(a) preliminary factual questions concerning the admissibility of evidence, such as whether an offer was made in the course of settlement negotiations, are to be determined by the court.

FRE 408 Determining when an offer is made

o         When a party is represented by counsel, threatens litigation and has initiated the first administrative steps in that litigation, any offer made between attorneys will be presumed to be an offer with the scope of the 408.

1. Demand letter
2. Filing a lawsuit.

When an offer is NOT made

o         Rule 408 does not protect offers to compromise made BEFORE a claim of some sort is made.

Court - Party Seeking admission

o         Must demonstrate convincingly that the offer was not an attempt to compromise a claim.

Df Argue We made the offer

Court There are consequences

o         If substance of negotiations were admissible at trial, many attorneys would be forced to testify as to the nature of the discussions that thus be disqualified as trial counsel.

o         No lawyer in a law firm would attend a negotiation session.

Court Holding

o         Even where the evidence offered favors the settling party and is objected to by a party not involved in the settlement, Rule 408 bars admission of such evidence unless it is admissible for a purpose other than 'to prove liability for or invalidity of the claim or its amount

Rules

Rule 408. Compromise and Offers to Compromise

         (a) Prohibited Uses - Evidence of the following is not admissible on behalf of any party, when offered to prove liability for, invalidity of, or amount of a claim that was disputed as to validity or amount, or to impeach through a prior inconsistent statement or contradiction:

o    (1) furnishing or offering or promising to furnish or accepting or offering or promising to accept a valuable consideration in compromising or attempting to compromise the claim ; and

o    (2) Conduct or statements made in compromise negotiations regarding the claim, except when offered in a criminal case and the negotiations related to a claim by a public office or agency in the exercise of regulatory, investigative, or enforcement authority.

         (b) Permitted uses. This rule does not require exclusion if the evidence is offered for purposes not prohibited by subdivision (a). Examples of permissible purposes include proving a witness's bias or prejudice ; negating a contention of undue delay; and proving an effort to obstruct a criminal investigation or prosecution.

Class Notes