1373158 v.1 

IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

VERITEXT/PA REPORTING COMPANY, LLC, : CIVIL ACTION 

t/a RSA : 

 Plaintiff, : 

 : 

 vs. : 

 :

E-REPORTING STENOGRAPHIC AFFILIATES : 

OF PENNSYLVANIA, INC., t/a E-RSA : 

F. DAVID DAMIANI, LAURA GROSSO, : 

CARMELLA MAZZA, RICHARD J. COLEMAN : 

 : 

 Defendants. : NO. 03-6533 

DEFENDANTS’ RESPONSE IN OPPOSITION TO 

THE MOTION TO ENFORCE SETTLEMENT

 Defendants E-Reporting Stenographic Affiliates of Pennsylvania, Inc., t/a E-RSA, 

F. David Damiani, Laura Grosso, Carmella Mazza and Richard J. Coleman (collectively referred 

to hereafter as “Defendants” or at times “E-RSA” individually), by and through their attorneys, 

Rawle & Henderson, LLP, hereby respond in opposition to the Motion to Enforce Settlement 

filed by plaintiff, Veritext/Pa Reporting Company LLC t/a RSA (hereafter “Veritext”). 

 For the reasons which are set forth fully in the accompanying Memorandum of Law, 

incorporated herein by reference, basic contract principles mandate that an enforceable 

agreement to settle does not exist. 

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 1 of 11
1373158 v.1 2

 WHEREFORE, defendants respectfully request that this Honorable Court deny Veritext’s 

Motion to Enforce Settlement. 

 Respectfully submitted, 

 RAWLE & HENDERSON LLP

 BY: /S/ MICHAEL P. DORSEY 

 Michael P. Dorsey, Esquire 

The Widener Building 

One South Penn Square 

Philadelphia, PA 19107 

(215) 575-4346 

Attorneys for Defendants, 

E-Reporting Stenographic Affiliates 

of Pennsylvania, Inc., t/a E-RSA, 

F. David Damiani, Laura Grosso, 

Carmella Mazza and Richard J. Coleman 

Dated: October 20, 2006

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 2 of 11
1373158 v.1 

IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

VERITEXT/PA REPORTING COMPANY, LLC, : CIVIL ACTION 

t/a RSA : 

 Plaintiff, : 

 : 

 vs. : 

 :

E-REPORTING STENOGRAPHIC AFFILIATES : 

OF PENNSYLVANIA, INC., t/a E-RSA : 

F. DAVID DAMIANI, LAURA GROSSO, : 

CARMELLA MAZZA, RICHARD J. COLEMAN : 

 : 

 Defendants. : NO. 03-6533 

MEMORANDUM OF LAW IN SUPPORT OF 

DEFENDANTS’ RESPONSE IN OPPOSITION TO 

THE MOTION TO ENFORCE SETTLEMENT

Defendants, E-Reporting Stenographic Affiliates of Pennsylvania, Inc., t/a E-RSA, 

F. David Damiani, Laura Grosso, Carmella Mazza and Richard J. Coleman (collectively referred 

to hereafter as “Defendants” or at times “E-RSA” individually) hereby submit the following 

Memorandum of Law in support of their opposition to the Motion to Enforce Settlement. 

I. INTRODUCTION

 This commercial dispute between two court reporting firms and certain individual 

members of E-RSA has been heavily litigated. A motion for summary judgment had been filed 

by Veritext and responded to by Defendants when the parties, through their counsel, reached an 

agreement in principle to settle this matter. In other words, the parties agreed on the dollar 

amount of the settlement only. The attorneys for both parties at the time were fully aware that 

essential terms and conditions of the settlement would need to be further negotiated, 

memorialized in a written agreement, and ultimately approved by their respective clients. 

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 Numerous unsuccessful attempts were made to finalize the settlement agreement. The 

parties have now reached an impasse as to an essential term of the agreement, that being a 

“Release” verses a “Covenant Not to Sue” with respect to the corporate defendant E-RSA. 

Veritext will not sign an agreement in which it releases E-RSA from “known or reasonably 

should have known” future claims, whereas, the Defendants will not agree to a covenant not to 

sue E-RSA because it views it as an invitation for future litigation by Veritext. The Defendants 

have never approved of an agreement that includes a covenant not to sue E-RSA and have 

always insisted that E-RSA be a released party. 

 As the following discussion clearly illustrates, the parties have not reached a meeting of 

the minds with respect to an essential term of the settlement agreement and therefore the 

agreement is unenforceable and Veritext’s motion should be denied. 

II. BACKGROUND

 While the Court’s ruling on Veritext’s opposed motion for summary judgment was 

pending, counsel for Veritext, Michael S. Hino, Esquire, and former counsel for defendants, 

Michael A. Meehan, Esquire, engaged in settlement negotiations. Those discussions were 

successful only in that the parties were able to agree on the dollar amount of the settlement. It 

was clear from the outset that the parties had not consummated a settlement agreement and that 

much work needed to be done in terms of further negotiating certain essential terms. It was also 

clear that counsel for both parties needed client approval of a written agreement in order to 

complete the settlement. 

 The above is confirmed in initial correspondence between Mr. Meehan and Mr. Hino 

which, ironically, Veritext cites in its Motion to support its position that the parties had agreed to 

the essential terms of the settlement. The following unambiguous language in the initial 

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1373158 v.1 3

correspondence clearly confirms that the parties had just begun negotiating the essential terms of 

the settlement, to wit: 

Please let this e-mail confirm our conversation of Tuesday 

morning. The parties have reached a settlement [sic] agreement in 

principle. In exchange for $100,000.00, plaintiff will resolve all of 

the claims set forth in the Complaint in this matter. We have 

discussed that Releases will be signed in favor of the individual 

defendants and that the plaintiff may possibly [sic] execute a 

covenant not to sue in favor of E-RSA. It is our understanding 

that plaintiff would drop the demand for a name change in this 

matter but that litigation against the Goldstein claims and claims 

Ed Tuite will survive. We also need to extinguish the vicarious 

liability [sic] E-RSA may have for claims against Messrs. 

Goldstein and Tuite. You agreed to take a shot at drafting a 

settlement agreement. 

We had hoped to hammer out the agreement this week. I will 

be out of the office tomorrow in the afternoon and in depositions 

most of the day on Friday. Do you know when you plan on 

providing us with a proposed Settlement Agreement and Release? 

[emphasis added] 

A copy of the June 5, 2005 e-mail Mr. Meehan sent to Mr. Hino suggesting a proposed 

settlement and the need to “hammer out” the essential terms of the agreement is attached hereto 

as Exhibit “A.” 

 Veritext contends that because it drafted a proposed Settlement Agreement based upon 

the above e-mail correspondence, an enforceable settlement had been reached. However, as 

Veritext rightfully points out, the proposed Settlement Agreement was forwarded to Mr. Meehan 

for the Defendants review and signature. Moreover, Mr. Meehan’s e-mail correspondence firmly 

establishes that a covenant not to sue with respect to E-RSA was an open issue which would 

require client approval. Mr. Meehan even contemplated the very real possibility that even 

though the parties reached a settlement in principle, the settlement discussions could eventually 

breakdown, which they did. He advised the Court of this in his letter dated June 15, 2005 which 

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 5 of 11
1373158 v.1 4

is attached as Exhibit “B” to Veritext’s Motion. 

 In addition, it is clear that once Mr. Meehan discontinued handling this case, his 

successor, David Santee, had ongoing negotiations with Mr. Hino. Those negotiations are 

evidenced by e-mails exchanged between Mr. Santee and Mr. Hino between March 3, 2006 and 

March 9, 2006. A true and correct copy of the e-mail exchanges between March 3, 2006 and 

March 9, 2006 is attached hereto as Exhibit “B.” Through these exchanges it is obvious that 

both attorneys were working at drafting language that was acceptable to both parties, and that 

Mr. Hino was “reserving the right to make additional changes” because his client had not 

reviewed the latest revisions. See Exhibit “B.” 

 Negotiations continued and on May 1, 2006, Mr. Santee forwarded to Mr. Hino yet 

another version of the proposed Settlement Agreement. This version contained release language 

with respect to E-RSA, not a covenant not to sue, and Mr. Santee expressed his hope that this 

version would be acceptable to Defendants though obviously still subject to their approval. A 

true and correct copy of the May 1, 2006 e-mail correspondence and Release is attached hereto 

as Exhibit “C”. Instead of advising whether the Release was acceptable, Mr. Hino, in a letter 

dated July 20, 2006, advised that Veritext signed a Release and Covenant Not to Sue and 

subsequently e-mailed a copy of that signed document. A true and correct copy of Mr. Hino’s 

July 20, 2006 letter is attached hereto as Exhibit “D”. On July 21, 2006, Mr. Santee wrote to Mr. 

Hino advising that the signed document forwarded by Veritext was not the latest version of the 

Release and not approved by the Defendants. A true and correct copy of Mr. Santee’s July 21, 

2006 letter is attached hereto as Exhibit “E”. 

 Defendants’ position is and always has been that anything less than a release of E-RSA is 

unacceptable. Defendants view a covenant not to sue as an invitation for further litigation 

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 6 of 11
1373158 v.1 5

initiated by Veritext. Therefore, while the parties agreed on the dollar amount of the settlement, 

they did not agree on an essential term regarding the release of E-RSA. It is respectfully 

submitted that the Court cannot enforce the settlement on the terms dictated by Veritext, and that 

a settlement, if any, must include a release of E-RSA. 

III. ARGUMENT

The enforcement of settlement agreements is determined according to principles of 

contract law. McDonnell v. Ford Motor Co., 643 A.2d 1102, 1105 (Pa. Super. 1994). A 

settlement, like any other agreement, must possess all the traditional elements of a valid contract, 

and where an alleged contract is wholly comprised of oral communications, courts may look to 

the surrounding circumstances and the course of dealing to ascertain the intent of the parties to 

be bound by the agreement. Westinghouse Elec. Co. v. Murphy, Inc., 228 A.2d 656 (Pa. 1967); 

Mountain Properties, Inc. v. Tyler Hill Realty Corp., 767 A.2d 1096 (Pa. Super. 2001) appeal 

denied 782 A.2d 547 (Pa. 2001). As with any contract, it is essential to the enforceability of a 

settlement agreement that the minds of the parties should meet upon all of the material terms, as 

well as the subject matter, of the agreement. Porreco v. Maleno Developers, Inc., 761 A.2d 629, 

reargument denied (Pa. Cmwlth. 2000); see also Mazzella v. Koken, 739 A.2d 531 (Pa. 1999). 

Where ambiguities and undetermined matters render an alleged settlement agreement impossible 

to enforce, the agreement must be set aside and the matter remanded for a trial on the merits. Id. 

 In Porreco, the parties, neighboring landowners involved in a dispute over excessive 

storm water drainage and runoff flowing from the properties, entered into a tentative agreement 

to settle their dispute. Porreco, 761 A.2d at 630. The parties agreed that the construction of a 

retention pond would take place and agreed on the division of responsibility for the cost of the 

construction. Id. They did not agree on the placement of the pond and the standards as to which 

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 7 of 11
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it would be constructed. The Commonwealth Court overturned the trial court’s enforcement of 

the settlement finding that the placement of the pond and its construction standards were material 

terms that went to the essence of the tentative settlement agreement. Id at 633. Therefore there 

was no meeting of the minds and an unenforceable settlement agreement. 

 It’s significant to note that the case cited by Veritext and primarily relied upon in its 

brief, Frank v. The Nostalgia Network, 1997 U.S. Dist. LEXIS 942 (E.D. Pa. January 30. 1997), 

involves a case where there is no dispute that the parties agreed to the essential terms of the 

settlement. In Frank, the plaintiff’s counsel, through a sworn affidavit, admitted that he and his 

client never discussed the tax consequences before agreeing to settle the case for $12,000.00. 

The plaintiff’s subsequent refusal to sign a release due to issues regarding tax consequences 

arising after the oral agreement was made, did not vitiate the settlement the parties voluntarily 

entered into. Id. 

 The facts regarding the formation of the settlement agreement here are analogous to 

Porreco, not Frank. Indeed, a covenant not to sue was not something that was agreed to by the 

Defendants when the parties tentatively settled their dispute in principle, and it in fact was raised 

only as a “possibility” in the initial e-mail correspondence of Mr. Meehan. See Exhibit “A”. It 

was clearly an open issue which needed to be approved by the Defendants in order to complete 

the settlement. That did not happen. There is also no dispute that a covenant not to sue is a 

material term of any settlement agreement. There was no meeting of the minds as to this 

essential term and therefore the settlement agreement is unenforceable. 

IV. CONCLUSION

 Veritext and Defendants did not enter into an enforceable settlement because the parties 

never reached a meeting of the minds regarding the release of E-RSA, an essential term of their 

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 8 of 11
1373158 v.1 7

tentative agreement. Therefore, Veritext’s Motion to Enforce Settlement must be denied and 

this matter returned to the Court’s trial schedule. 

 Respectfully submitted, 

 RAWLE & HENDERSON LLP

 BY: /S/ MICHAEL P. DORSEY 

 Michael P. Dorsey, Esquire 

The Widener Building 

One South Penn Square 

Philadelphia, PA 19107 

(215) 575-4346 

Attorneys for Defendants, 

E-Reporting Stenographic Affiliates 

of Pennsylvania, Inc., t/a E-RSA, 

F. David Damiani, Laura Grosso, 

Carmella Mazza and Richard J. Coleman 

Dated:

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 9 of 11
1373158 v.1 

CERTIFICATE OF SERVICE

 I hereby certify that on today’s date I served a true and correct copy of the foregoing 

Defendants’ Response in Opposition to the Motion to Enforce Settlement of Plaintiff, 

Veritext/Pa Reporting Company L.L.C. t/a RSA by first-class mail, postage prepaid, upon the 

attorney of record, addressed as follows: 

 Michael S. Hino, Esquire 

 Pepper Hamilton LLP 

 400 Berwyn Park 

 899 Cassatt Road 

 Berwyn, PA 19312 

 Peter J. Mooney, Esquire 

 White and Williams LLP

 1800 One Liberty Place 

 Philadelphia, PA 19103-7395 

 RAWLE & HENDERSON LLP

By:__/S/ MICHAEL P. DORSEY___________ 

 Michael P. Dorsey, Esquire 

DATED: October 20, 2006

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 10 of 11
 v.1 

IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

VERITEXT/PA REPORTING COMPANY, LLC, : CIVIL ACTION 

t/a RSA : 

 Plaintiff, : 

 : 

 vs. : 

 :

E-REPORTING STENOGRAPHIC AFFILIATES : 

OF PENNSYLVANIA, INC., t/a E-RSA : 

F. DAVID DAMIANI, LAURA GROSSO, : 

CARMELLA MAZZA, RICHARD J. COLEMAN : 

 : 

 Defendants. : NO. 03-6533 

ORDER

 AND NOW, this ______ day of __________________________________, 2006, upon 

consideration of the Motion to Enforce Settlement of Plaintiff Veritext/PA Reporting Company, 

LLC, t/a RSA, and the Response filed by the Defendants, it is hereby ORDERED that said 

Motion is DENIED. 

 BY THE COURT: 

 _____________________________________ 

 The Honorable Bruce J. Kauffman 

Case 2:03-cv-06533-BWK Document 40 Filed 10/20/06 Page 11 of 11