Opinion ID: 4328257
Heading Depth: 2
Heading Rank: 2

Heading: Claim IX

Text: The district court ruled that summary judgment was proper on claim IX for breach of contract enforced by a third-party beneficiary. The court reasoned that because the loan agreement required only that Patricia repay the full principal amount plus accrued interest in 2040, her refusal of Lane’s demand for immediate repayment breached none of the agreement’s terms. The court ruled that communications from Patricia’s attorney to Lane, which Lane said were evidence that Patricia had anticipatorily repudiated the loan agreement, were inadmissible under Federal Rule of Evidence 408 because they were made in the course of settlement negotiations. In relevant part, Rule 408 provides that “[e]vidence of the following is not admissible— on behalf of any party—either to prove or disprove the validity or amount of a disputed claim or to impeach by a prior inconsistent statement or a contradiction: . . . conduct or a statement made during compromise negotiations about the claim.” Fed. R. Evid. 408(a)(2). Although the district court analyzed and rejected other arguments Lane made regarding claim IX, Lane challenges only the district court’s ruling that Rule 408 9 prohibited consideration of statements in emails Patricia’s attorney had written to Lane. Although there were three such emails, only one is at issue in this appeal. It is titled “Lane matters – Subject to Rule 408(2).” Aplt. App., Vol. 3 at A612. In relevant part, Patricia’s attorney stated: “I question the validity of your assertion that these are borrowed funds. In fact, this appears to be a gift like so many people made in the last half of 2012 to avoid the anticipated decrease in the federal unified credit.” Id. The district court excluded these statements under Rule 408 because they were made as part of settlement negotiations. Although Rule 408 has certain exceptions, Lane does not argue that any of them apply here; he contends only that “[t]he district court should have redacted the language referencing settlement negotiations and admitted the substantive portions of the documents which form the basis of [Patricia’s] repudiation.” Aplt. Opening Br. at 16–17. None of the three cases he cites in support of this argument, however, persuades us that the district court erred. In the first case, the issue was whether the trial court erred in admitting a document that had the following statement redacted: “Please review and advise with respect to settlement of the claim.” Wingert & Assocs., Inc. v. Paramount Apparel Int’l, Inc., No. CIV 03–6451 ADM/AJB, 2005 WL 2847323, at  (D. Minn. Oct. 31, 2005) (unpublished). The court held that even with the redacted language, it was “not clear” that the letter “constituted any sort of settlement negotiation,” and without the redacted language, “nothing . . . indicate[d] any admission of fault.” Id. The email here clearly indicated it was part of a settlement negotiation, and the 10 statements at issue, which contest Lane’s view of the loan agreement, are clearly central to that negotiation. The second case, King v. University Healthcare System, L.C., No. CIV A 08–1060, 2009 WL 2222698 (E.D. La. July 24, 2009) (unpublished), contains no reference to Rule 408 or settlement negotiations. And in the third case, the court held that although Rule 408 required redaction of “any offers of compromise,” it did not bar production of other information contained in claims made to a bankruptcy trust that were more akin to a complaint than an offer of settlement or compromise. Shepherd v. Pneumo-Abex, LLC, No. 09-91428, 2010 WL 3431633, at  (E.D. Pa. Aug. 30, 2010) (unpublished). This case is distinguishable because the statements here are clearly part of, and integral to, an offer of settlement or compromise. We therefore see no error in the district court’s refusal to consider them on summary judgment. See Thomas v. IBM, 48 F.3d 478, 485 (10th Cir. 1995) (explaining that at summary judgment, “the content or substance of the evidence must be admissible”).