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Schultz v. Verizon Wireless Services, LLC

United States District Court, N.D. Iowa, Eastern Division

February 27, 2015



JON STUART SCOLES, Magistrate Judge.

This matter comes before the Court on the Motion for Enforcement of Settlement or, in the Alternative, for a Settlement Conference (docket number 19) filed by the Defendant on January 13, 2015, and the Motion for Enforcement of Settlement (docket number 25) filed by the Plaintiffs on January 27. Pursuant to Local Rule 7.c, the motions will be decided without oral argument.


On June 17, 2014, Plaintiffs Craig Schultz and Belen Schultz filed a complaint against Defendant Verizon Wireless Services, LLC[1] ("Verizon"), seeking damages for alleged violations of the federal Telephone Consumer Protection Act and the Iowa Debt Collection Practices Act. On September 8, Verizon filed a motion to dismiss and to compel arbitration.[2] On November 7, while Verizon's pre-answer motion was pending, Plaintiffs filed a "notice of settlement." On November 17, the Court filed an Order of Case Dismissal, directing the parties to file the settlement documents within 30 days. The deadline was later extended to January 19, 2015.

On January 13, 2015, Verizon filed its motion to enforce the settlement. On January 27, Plaintiffs responded with their own motion to enforce the settlement. Verizon filed a response on February 13.


Following an exchange of emails between October 27 and October 31, 2014, the parties agreed to a cash settlement in a specified amount. See Plaintiffs' Exhibit 1 (docket number 29). The parties are unable to agree, however, regarding the language to be included in a "settlement agreement and release between Craig Schultz and Belen Schultz, and Verizon Wireless." Verizon believes the agreement is reflected in its Exhibit A (docket number 24), while Plaintiffs believe the agreement is reflected in their Exhibit 2 (docket number 29-1).

The fighting issue is whether the settlement agreement will include a "non-disparagement" clause. Paragraph 21 of Verizon's proposed settlement agreement provides that the parties shall not make any disparaging remarks against the other party. Plaintiffs' proposed settlement agreement omits that clause.

After the parties reached an agreement regarding the amount of the settlement, counsel for Verizon apparently sent counsel for Plaintiffs a draft settlement agreement that included, among other things, a non-disparagement clause.[4] On November 12, Plaintiffs' counsel apparently responded by sending a revised settlement agreement to Verizon's counsel. According to Verizon's brief, none of the proposed revisions dealt with the non-disparagement clause, which remained as part of the agreement returned by Plaintiffs.[5]

In its speaking brief, Verizon asserts that the parties then negotiated over the course of the next several weeks regarding the terms of the written agreement. According to Verizon's brief, "[d]uring this time, Plaintiffs' counsel never mentioned the non-disparagement clause, never modified that clause, and never removed that clause."[6] Plaintiffs' counsel, Joseph Panvini, states in his sworn declaration that Verizon's attorney emailed him a proposed settlement agreement on November 12 and "over the next month we exchanged emails regarding the discussion of certain terms to be included or not included in the release agreement."[7]

According to Mr. Panvini, he did not send Plaintiffs a complete copy of the proposed stipulation for their review until December 12, "at which time I colloquially stated in an email to [Verizon's attorney] that we will get it executed.'"[8] Plaintiffs subsequently informed Mr. Panvini that they would not sign the release as drafted. Mr. Panvini called Verizon's attorney on December 17 and told her that "if Defendant made certain other concessions, that I would convince Plaintiffs to leave in the non-disparagement clause."[9] Despite his representation, however, Mr. Panvini was unable to convince his clients to sign the release containing the non-disparagement clause. According to Verizon's brief, that was the first time that it was informed that Plaintiffs had a problem with the non-disparagement clause.

On December 30, Mr. Panvini sent Verizon's attorney a settlement agreement signed by Plaintiffs, but which did not include a non-disparagement clause. See Plaintiffs' Exhibit 2 (docket number 29-1). That proposed agreement was unacceptable to Verizon.


Both parties ask the Court to enter an order enforcing their version of the settlement agreement. The Court can easily dispose of Plaintiffs' motion. That is, it is clear that Verizon never agreed to a settlement which did not include a non-disparagement clause. Verizon's motion presents a somewhat closer question. Verizon argues that because Plaintiffs did not complain about the non-disparagement clause until all ...

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