Savage v. Twp. of Neptune

• Decision Date: 31 May 2022
• Docket Number: DOCKET NO. A-1415-20
• Citation: 472 N.J.Super. 291,276 A.3d 685
• Parties: Christine SAVAGE, Plaintiff-Appellant, v. TOWNSHIP OF NEPTUNE, Neptune Township Police Department, Michael J. Bascom, in an individual and official capacity, and James M. Hunt, in an individual and official capacity, Defendants-Respondents, and Robert Mangold, in an individual and official capacity, Michael McGhee, in an individual and official capacity, Anthony Gualario, in an individual and official capacity, Kevin O'Donnell, in an individual and official capacity, Vito Gadaleta, in an individual and official capacity, Scott Cox, in an individual and official capacity, Lewis Schlosser, and The Institute for Forensic Psychology, Defendants.
• Court: New Jersey Superior Court — Appellate Division

472 N.J.Super. 291

276 A.3d 685

Christine SAVAGE, Plaintiff-Appellant,

v. TOWNSHIP OF NEPTUNE, Neptune Township Police Department, Michael J. Bascom, in an individual and official capacity, and James M. Hunt, in an individual and official capacity, Defendants-Respondents,andRobert Mangold, in an individual and official capacity, Michael McGhee, in an individual and official capacity, Anthony Gualario, in an individual and official capacity, Kevin O'Donnell, in an individual and official capacity, Vito Gadaleta, in an individual and official capacity, Scott Cox, in an individual and official capacity, Lewis Schlosser, and The Institute for Forensic Psychology, Defendants.

DOCKET NO. A-1415-20

Superior Court of New Jersey, Appellate Division.

Argued May 19, 2022

Decided May 31, 2022

Donald F. Burke, Jr. argued the cause for appellant (Law Office of Donald F. Burke, attorney; Donald F. Burke and Donald F. Burke, Jr., on the briefs).

John D. McCarthy, Florham Park, argued the cause for respondents Michael J. Bascom and James M. Hunt (Schenck, Price, Smith & King, LLP, attorneys; Joseph Maddaloni, Jr., Florham Park, and John D. McCarthy, of counsel and on the brief).

The Dwyer Law Firm, LLC and Bennet D. Zurofsky, Newark, attorneys for amicus curiae National Employment Lawyers Association of New Jersey (Andrew W. Dwyer and Bennet D. Zurofsky, of counsel and on the brief).

Before Judges Haas, Mawla and Alvarez.

The opinion of the court was delivered by

HAAS, P.J.A.D.

Plaintiff Christine Savage, a former sergeant with defendant Township of Neptune Police Department, appeals from an order enforcing a "non-disparagement provision" in a settlement agreement. In the underlying employment discrimination case, plaintiff alleged defendants engaged in continuing sexual discrimination, harassment, and unlawful retaliation, in violation of New Jersey's Law Against Discrimination (LAD) N.J.S.A. 10:5-1 to -50, the New Jersey Civil Rights Act, N.J.S.A. 10:6-1 to -2, and Article I, Paragraph 6 of the New Jersey Constitution. On July 23, 2020, the parties settled the employment discrimination action and entered into an agreement, which included a non-disparagement provision, but not a non-disclosure provision.

Defendants Michael J. Bascom, the former Police Director for Neptune Township, and James M. Hunt, the Chief of the Neptune Police Department, filed a motion in September 2020, to enforce the settlement, arguing that plaintiff violated the non-disparagement provision during an interview with a television news reporter that aired on Channel 4, NBC news on August 11, 2020. The trial judge granted defendants' motion, finding that N.J.S.A. 10:5-12.8(a) only barred confidentiality or non-disclosure agreements (also referred to as NDAs), and that plaintiff violated the non-disparagement provision in the agreement when she commented during the televised interview that the Neptune Police Department had not changed, and it was still a "good old boys club." The judge subsequently awarded defendants $4,917.50 in counsel fees and costs for breach of the non-disparagement clause.

Plaintiff appeals from the order enforcing the non-disparagement provision of the settlement agreement. On appeal, plaintiff argues that the judge erred in granting the motion because the non-disparagement provision was against public policy and unenforceable under N.J.S.A. 10:5-12.8(a), and thus the judge also erred in denying her cross-motion for counsel fees under N.J.S.A. 10:5-12.9. In the alternative, plaintiff argues that even if the non-disparagement provision were enforceable, by adjudicating this dispute as a motion to enforce, rather than as a separate breach of contract action, the judge deprived her of her right to have a jury decide the disputed facts.

For the reasons that follow, we reverse the order granting defendants' motion to enforce the settlement agreement and find that although the terms of the non-disparagement provision are enforceable and the judge properly adjudicated this matter by motion, the judge nonetheless erred in finding that plaintiff violated the terms of the non-disparagement provision during the televised interview. Because defendants' enforcement motion was not successful, we vacate the judge's award of $4,917.50 in counsel fees to defendants. However, we affirm the judge's order denying plaintiff's cross-motion for counsel fees and costs under N.J.S.A. 10:5-12.9.

I.

In December 2013, plaintiff, who had been employed as a police officer by the Neptune Police Department since January 5, 1998, brought an action against defendants under the LAD for sexual harassment, sexual discrimination in the form of a hostile work environment, and retaliation for filing a charge of sex discrimination with the Equal Employment Opportunity Commission (EEOC) (the first action). The parties entered into a settlement agreement in that case in May 2014, under which defendants agreed to promote plaintiff to sergeant and to provide her with access to training.¹

In a second action, plaintiff filed a complaint in April 2016 and an amended complaint in September 2018, against, among others, defendants Township of Neptune, Neptune Township Police Department, Bascom, and Hunt. Plaintiff alleged continuing sex discrimination and harassment, retaliation, and aiding and abetting discrimination in violation of the LAD, and violations of the New Jersey Civil Rights Act and State Constitution.

In her amended complaint, plaintiff asserted defendants violated "the letter and spirit of the Settlement Agreement" entered in the first action because even though she was promoted to sergeant on May 1, 2014, three male police officers were promoted at the same time thereby sending "a message to the rank and file that male dominance" of the police department "would remain the status quo." She alleged defendants failed to provide her with the agreed upon training, and promoted men ahead of women in violation of their standard operating procedures. She also claimed that after the settlement in the first action, the sexual discrimination, harassment, and retaliation against her "intensified," and she was subjected to unfair assessments, arbitrary internal affairs investigations, discriminatory work assignments, discriminatory performance standards and evaluations, and more stringent scrutiny, monitoring and oversight. She was ultimately placed "on no-pay status" based on the result of an undisclosed "Fitness for Duty evaluation."

On July 23, 2020, after engaging in three months of extensive negotiation and mediation before a retired Superior Court Judge, the parties executed the comprehensive "Settlement Agreement and General Release." The "lynchpin" of the agreement was to allow plaintiff to remain employed by the Township so she could reach her twenty-five years of pensionable/creditable service by her predicted retirement date of June 1, 2021. Defendants agreed that plaintiff, who was then on paid administrative/medical leave, would be permitted, once medically cleared, to return to work until she reached her retirement date, and they also agreed to pay her $175,000 (pain and suffering), $50,354.32 (reimbursement for purchase of pension credits), and $23,206.38 (retroactive pay).

At issue here, the settlement agreement included the following mutual "non-disparagement provision":

10. The parties agree not to make any statements written or verbal, or cause or encourage others to make any statements, written or verbal regarding the past behavior of the parties, which statements would tend to disparage or impugn the reputation of any party. The parties agree that this non[-]disparagement provision extends to statements, written or verbal, including but not limited to, the news media, radio, television, internet postings of any kind, blogs, social media, (e.g., Facebook, Instagram, Twitter, or the like), consumer or trade bureaus, other state, county or local government offices or police departments or members of the public. Neptune Township will respond to inquiries from prospective employers with dates of employment and positions held. The parties agree that non-disparagement is a material term of this Agreement and that in the event of a breach, the non-breaching party may seek enforcement of the non-disparagement provision and damages for its breach, and that the filing of any such action would not be deemed a breach of this Agreement. Nothing herein shall be construed as prohibiting or precluding in any way testimony or statements of [p]laintiff related to other proceedings including lawsuits.

[(emphasis added).]

During oral argument on the motion to enforce the settlement, defendants' counsel represented that earlier versions of the agreement contained a very broad-based provision that included both a confidentiality or non-disclosure provision and a non-disparagement provision. Defense counsel said they agreed to remove the confidentiality provision based on "extensive discussions" about its unenforceability under N.J.S.A. 10:5-12.8(a), but did not remove the non-disparagement provision because the parties agreed that it was material to the agreement that neither party would disparage the other. Defense counsel claimed "there was never any discussion about [the] non-disparagement provisions being unenforceable." However, plaintiff's counsel maintained he had expressed the view that the non-disparagement provision was unenforceable, but ultimately agreed to include the provision because under the severance clause of the agreement, the remainder of the agreement would remain enforceable even if that provision was stricken.

In any event, the settlement was placed on the record on July 24, 2020. On that same date, the trial judge issued an order dismissing the case setting forth that it was "Settled by Conference by Judge."² On August 1, 2020, the parties filed a stipulation of dismissal without prejudice as to plaintiff's application for attorney's fees and costs as a prevailing ...