By: Donald L Swanson
Plaintiff claims to have been deceived into reaching a mediated settlement agreement—and refuses to proceed with the agreement.
The U.S. District Court rejects Plaintiff’s deception claim. And the U.S. Sixth Circuit Court of Appeals affirms. The Sixth Circuit’s opinion is White v. Perron, Case No 23-1542, decided September 25, 2023.
Facts
White v. Perron is a prisoner’s lawsuit in the U.S. District Court for Western Michigan.
During the lawsuit, the parties reach a mediated agreement for dismissal of the lawsuit in exchange for payment of $1,500 damages to Plaintiff. The agreement is made verbally and with an audio recording.
Then, Plaintiff learns that a portion of the $1,500 will be deducted to pay debts he owes at the prison.
So, Plaintiff claims to have been deceived about the deduction when entering into the settlement agreement. And he refuses to sign the settlement / dismissal documents.
Both the District Court and the Sixth Circuit uphold the mediated agreement and dismiss the case.
U.S. Sixth Circuit Opinion
The Sixth Circuit does not acknowledge Plaintiff’s deception claim.
Instead, it provides the following analysis of applicable legal authorities:
- Article III of the U.S. Constitution conditions the exercise of federal judicial power on the existence of a live, ongoing case or controversy;
- So, a case becomes moot when the issues presented are no longer “live” or the parties lack a legally cognizable interest in the outcome—at which time, federal courts no longer have jurisdiction and must dismiss the case;
- settlement agreements qualify as the types of interim relief or events that may “deprive the court of the ability to give meaningful relief” and render a case moot; and
- because Plaintiff agreed to dismissal in exchange for damages, he no longer has a legally cognizable interest in the outcome of the litigation and the appeal is moot.
U.S. District Court Ruling
By Order dated July 26, 2023, the U.S. District Court below addresses Plaintiff’s deception argument like this:
- there is no dispute that the parties reached an agreement on the record;
- Plaintiff argues that Defendants were not “honest, forthright, and did not fully disclose to Plaintiff” that the $1,500 settlement amount would be subject to “forfeiture for various undisclosed reasons and debts”; and
- the Court “disagrees” because, (i) the parties reached an agreement on all the essential terms, (ii) whether Plaintiff “knew that some of the money had to be used to pay his institutional debt is immaterial,” and (ii) in all events, Plaintiff would remain liable for his institutional debt, which Michigan law requires him to repay.
Further, it is within the Court’s inherent power to direct a party to execute and deliver settlement documents that reflect an agreed resolution of a case. And so, the District Court rules:
- Plaintiff must execute the settlement documentation “within fourteen days of this Order”; but
- If Plaintiff fails to do so, “the Court will deem those documents fully executed for purposes of concluding this action.”
Conclusion
Plaintiff’s deception claim finds no support from, and is given short shrift by, the federal courts involved.
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