Court Opinion

ID: 3185945
Source: CourtListenerOpinion
Date Created: 2016-03-16 17:07:39.035062+00
Date Added: 2024-06-11T11:14:43.582519
License: Public Domain

In the

       United States Court of Appeals
                   For the Seventh Circuit
                       ____________________
No. 15-1098

MARTINA BEVERLY,
                                                    Plaintiff-Appellant,

                                   v.

ABBOTT LABORATORIES,
                                                   Defendant-Appellee.
                       ____________________

           Appeal from the United States District Court for the
             Northern District of Illinois, Eastern Division.
              No. 12 CV 3216 — Edmond E. Chang, Judge.
                       ____________________

      ARGUED SEPTEMBER 9, 2015 — DECIDED MARCH 16, 2016
                   ____________________

      Before EASTERBROOK, KANNE, and WILLIAMS, Circuit Judg-
es.
    WILLIAMS, Circuit Judge. Martina Beverly sued her former
employer, Abbott Laboratories (Abbott), for employment
discrimination and retaliation. During a private mediation,
the parties signed a handwritten agreement stating that Bev-
erly demanded $210,000 and mediation costs in exchange for
dismissing the lawsuit. Abbott later accepted Beverly’s de-
2                                                         No. 15-1098

mand and circulated a more formal settlement proposal. Af-
ter Beverly refused to execute this draft proposal, Abbott
moved to enforce the original handwritten agreement.
    The district court found that the parties entered into a
binding settlement agreement and granted Abbott’s motion
to enforce. Beverly appeals this decision, arguing that Abbott
intended to be bound only by the terms of the typewritten
proposal and that the handwritten agreement omits certain
material terms.
    However, we find that the handwritten agreement was
valid and enforceable, since the agreement’s material terms
were clearly conveyed and consented to by both parties, and
the existence and content of the draft proposal do not affect
enforceability. Therefore, we affirm the district court’s grant
of Abbott’s motion to enforce.
                       I. BACKGROUND
    Beverly is a former Abbott employee whose employment
was terminated on October 20, 2010. A year and a half later,
she filed suit against Abbott. She alleged that during her
employment with the company, Abbott had discriminated
and retaliated against her on the basis of her German nation-
ality in violation of Title VII of the Civil Rights Act, as well
as on the basis of her disabilities in violation of the Ameri-
cans with Disabilities Act. The district court denied Abbott’s
motion for summary judgment as to Beverly’s national
origin claims and certain of her disability claims, and the
parties engaged in a private mediation. 1

    1 Beverly’s husband, Henry, is also a named plaintiff in the lawsuit
against Abbott. The district court granted Abbott’s motion for summary
No. 15-1098                                                           3

    A day before the mediation took place, Abbott’s counsel
sent Beverly’s counsel a “template settlement agreement” in
order to avoid “any surprises in the event that [the parties]
are able to resolve the matter.” This template included six
typewritten pages and provided, among other things, that
Beverly had twenty-one days to review the document and
seven days to revoke her acceptance; that Beverly would re-
lease and waive any and all claims against Abbott and its
affiliates; that Abbott would send two separate checks to
Beverly and a third check to Beverly’s attorneys for unspeci-
fied amounts; and that Abbott would pay all mediation
costs.
    The mediation session lasted approximately fourteen
hours and both parties were represented by counsel the en-
tire time. Near the end of the session, both parties and their
counsel signed a handwritten agreement that stated:
       I Jon Klinghoffer will commit that my client will com-
       municate to its internal business client the fact that Ab-
       bott/AbbVie has offered $200,000 + Abbott/AbbVie pays
       cost of mediation to resolve this matter and that Martina
       Beverly has demanded $210,000 + Abbott/AbbVie pays
       cost of mediation to resolve this matter. Both parties
       committ [sic] that their offer and demand will remain
       open until Tuesday, July 22, 2014, 3:00 PM central.

    On the following day, Abbott’s counsel emailed Beverly’s
counsel and stated, “My client has accepted Martina Bever-
ly’s demand to resolve her claims in the above referenced
matter for $210,000 plus the costs of yesterday’s mediation. I

judgment as to all of Henry’s claims; however, this appeal does not con-
cern that decision or any of Henry’s claims. Unless otherwise specified,
all references to “Beverly” in this opinion concern Martina.
4                                                           No. 15-1098

have attached a draft settlement agreement for your re-
view.” This draft was largely identical to the template set-
tlement agreement sent two days earlier, with three excep-
tions: (1) the replacement of “Abbott” with “AbbVie” 2; (2)
the inclusion of the precise dollar amounts to be paid to Bev-
erly ($23,000 for damages, $23,000 for backpay) and to her
attorneys ($164,000); and (3) the exclusion of a provision
preventing Beverly from disparaging Abbott or AbbVie.
    Approximately five minutes after receiving the email
from Abbott’s counsel, Beverly’s counsel responded via
email and stated, “Oh happy days! Best $10,000 Abbott has
ever spent. You are a gem.” Several minutes later, Beverly’s
counsel forwarded the Abbott counsel’s email and draft
proposal to Beverly for review. Beverly ultimately declined
to sign the proposal.
    Abbott filed a motion to enforce the handwritten agree-
ment. In the motion, Abbott argued that the agreement was
enforceable because an offer, acceptance, and meeting of the
minds had occurred, and that the parties’ subsequent inabil-
ity to execute the typewritten proposal was irrelevant. In re-
sponse, Beverly argued that the handwritten agreement was
merely a preliminary document that captured the parties’
intention to execute a binding settlement agreement in the
future. She also contended that the omission of multiple ma-

    2 In January 2013, Abbott split into two separate publicly traded
companies. One company (the “new” Abbott) primarily focuses on the
production of medical devices, diagnostic products, and infant formula,
while the other company (AbbVie) primarily focuses on the research and
development of certain pharmaceutical products. The parties do not call
attention to this corporate distinction, and it does not appear to be rele-
vant for purposes of this dispute.
No. 15-1098                                                     5

terial terms from the handwritten agreement illustrated its
non-binding nature.
   The district court granted Abbott’s motion, finding that
the parties had entered into a binding settlement agreement
that included all material terms—specifically, the dismissal
of the case in exchange for $210,000 and mediation costs.
Beverly appeals this decision.
                        II. ANALYSIS
   On appeal, Beverly argues that the district court erred by
granting Abbott’s motion to enforce the handwritten settle-
ment agreement. We disagree. We review the district court’s
decision to enforce the settlement agreement for abuse of
discretion. Hakim v. Payco-Gen. Am. Credits, Inc., 272 F.3d 932,
953 (7th Cir. 2001). However, the question of whether a set-
tlement agreement exists is a question of law that we review
de novo. Newkirk v. Village of Steger, 536 F.3d 771, 774 (7th
Cir. 2008).
   A. Handwritten Agreement Enforceable
     State contract law governs issues concerning the for-
mation, construction, and enforcement of settlement agree-
ments. Sims-Madison v. Inland Paperboard & Packaging, Inc.,
379 F.3d 445, 448 (7th Cir. 2004) (citing Pohl v. United Airlines,
Inc., 213 F.3d 336, 338 (7th Cir. 2000)). Both parties rely on
Illinois law to support their arguments, so we too will look
to that body of substantive law. Under Illinois law, the exist-
ence of a valid and enforceable contract is a question of law
when the basic facts are not in dispute. Echo, Inc. v. Whitson
Co., 121 F.3d 1099, 1102 (7th Cir. 1997). A settlement agree-
ment is enforceable if there was a meeting of the minds or
mutual assent to all material terms. Abbott Labs. v. Alpha
6                                                     No. 15-1098

Therapeutic Corp., 164 F.3d 385, 387 (7th Cir. 1999) (citing SBL
Assoc. v. Village of Elk Grove, 617 N.E.2d 178, 182 (Ill. 1993)).
Material terms are sufficiently definite and certain when
they enable a court to ascertain what the parties agreed to
do. K4 Enters., Inc. v. Grater, Inc., 914 N.E.2d 617, 624 (Ill.
App. Ct. 2009) (citing Midland Hotel Corp. v. Reuben H. Don-
nelly Corp., 515 N.E.2d 61, 65 (Ill. 1987)).
    Illinois follows the objective theory of intent whereby the
written records of the parties’ actions—rather than their sub-
jective mental processes—drive the inquiry. Newkirk, 536
F.3d at 774; see also Int’l Minerals & Chem. Corp. v. Liberty
Mut. Ins. Co., 522 N.E.2d 758, 764 (Ill. App. Ct. 1988) (“The
paramount objective is to give effect to the intent of the par-
ties as expressed by the terms of the agreement.”).
    When a settlement agreement concerns federal claims in
the employment discrimination context, we typically inquire
whether the agreement was knowingly and voluntarily exe-
cuted based on the totality of the circumstances. Dillard v.
Starcon Int’l, Inc., 483 F.3d 502, 507 (7th Cir. 2007). This in-
quiry is unnecessary here, however, since Beverly did not
contend during the district court proceedings, and does not
contend on appeal, that she executed the handwritten
agreement involuntarily or unknowingly. See Milligan v. Bd.
of Trs. of S. Ill. Univ., 686 F.3d 378, 386 (7th Cir. 2012) (“Milli-
gan did not make that argument, either here or in the district
court. His failure to do so forfeits the argument.”).
    We find that the district court correctly concluded that
the handwritten agreement was enforceable because the
agreement sufficiently defines the parties’ intentions and ob-
ligations. The material terms in the agreement clearly pro-
vide that Beverly offered to “resolve this matter”—i.e., vol-
No. 15-1098                                                    7

untarily dismiss her alienage and disability claims—if Ab-
bott paid $210,000 and mediation costs. See Elustra v. Mineo,
595 F.3d 699, 709 (7th Cir. 2010) (“We find that the material
terms were definite and certain: defendants would pay
$6,000 to the Elustras in exchange for their dismissal of the
lawsuit.”). It also states that Abbott had five days within
which to accept Beverly’s offer, which it did the following
day. Both parties and their respective attorneys signed the
agreement, further demonstrating their intent to be bound
by the terms of the document. And the elated response of
Beverly’s counsel to Abbott’s acceptance further underscores
the parties’ understanding that the handwritten agreement
would settle Beverly’s claims.
    Beverly contends that the district court erred in relying
on cases such as Elustra v. Mineo that involve oral agree-
ments because the agreement at issue here was handwritten,
not oral. But Beverly fails to cite a single case to support this
contention, much less explain why the oral-versus-written
distinction is relevant here. This failure amounts to forfei-
ture. See United States v. Berkowitz, 927 F.2d 1376, 1384 (7th
Cir. 1991) (holding that “perfunctory and undeveloped ar-
guments, and arguments that are unsupported by pertinent
authority,” are forfeited on appeal). Forfeiture aside, our cas-
es counsel that the relevant inquiry is whether the agreement
at issue is sufficiently clear regarding its material terms, not
whether the agreement was captured in writing. Compare
Abbott Labs., 164 F.3d at 388 (involving preliminary written
agreement), and Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547,
564 (7th Cir. 2012) (same), with Elustra, 595 F.3d at 708–09
(involving preliminary oral agreement), and Dillard, 483 F.3d
at 507–08 (same).
8                                                 No. 15-1098

    B. Typewritten Proposal Does Not Affect Enforceabil-
    ity
    Beverly argues that the twenty-one-day consideration pe-
riod and the seven-day revocation period in the typewritten
proposal demonstrate that Abbott intended to be bound on-
ly if the typewritten proposal was executed. But this argu-
ment ignores the fact that the “anticipation of a more formal
future writing does not nullify an otherwise binding agree-
ment.” Abbott Labs., 164 F.3d at 388 (citing Dawson v. Gen.
Motors Corp., 977 F.2d 369, 374 (7th Cir. 1992)). Indeed, we
have observed that “Illinois courts have not been shy about
enforcing promises made in the context of ongoing negotia-
tions and often involving preliminary or ‘incomplete’
agreements.” Dawson, 977 F.2d at 374 (collecting cases). We
agree with the district court that the parties’ failure to exe-
cute the typewritten proposal simply left the handwritten
agreement’s enforceability undisturbed.
    Beverly’s reliance on Ocean Atlantic Development Corp. v.
Aurora Christian Schools, 322 F.3d 983 (7th Cir. 2003), is mis-
placed. Ocean Atlantic involved two offer letters that, instead
of triggering certain key obligations and events themselves,
merely anticipated the triggering of these obligations and
events by the future execution of an anticipated contract. Id.
at 997–99 (observing that both offer letters stated they “will
serve to set forth some of the parameters for an offer,” and
that inspection, default, and refundability of the earnest
money deposit all depended on the future execution of a
contract and not of the offer letters). Here, however, neither
the text of the handwritten agreement nor the parties’ prior
dealings demonstrate that the parties believed their mutual
No. 15-1098                                                   9

obligations were dependent upon the future execution of a
final contract with additional terms.
   Beverly also argues that the handwritten agreement is
not enforceable because it omits certain purportedly material
terms that appear in the subsequent draft proposal. We dis-
agree.
    A settlement agreement may be enforceable despite the
omission of certain terms so long as those terms are not ma-
terial. See Wigod, 673 F.3d 547, 564 (7th Cir. 2012) (observing
that “[a] contract may be enforced even though some con-
tract terms may be missing or left to be agreed upon” (citing
Acad. Chi. Publishers v. Cheever, 578 N.E.2d 981, 983–84 (Ill.
1991))); Pritchett v. Asbestos Claims Mgmt. Corp., 773 N.E.2d
1277, 1282 (Ill. App. Ct. 2002) (“Every feasible contingency
that might arise in the future need not be provided for in a
contract for the agreement to be enforceable…. Ambiguity
will prevent the enforcement of a contract only where the
ambiguity affects the material terms of the contract.”).
    Beverly appears to concede—as she must—that the pay-
ment of $210,000 and mediation fees and the dismissal of the
case are material terms. But she argues that additional terms
were required to communicate the parties’ fundamental ob-
ligations—specifically, provisions relating to indemnifica-
tion, future cooperation between the parties, Beverly’s future
employment options with Abbott, the precise allocation of
settlement funds, and express language concerning release
and waiver. However, these various provisions, taken to-
gether, constitute nearly the entire six-page typewritten pro-
posal; certainly they are not all equally essential. See Rose v.
Mavrakis, 799 N.E.2d 469, 473–74 (Ill. App. Ct. 2003) (stating
that “[t]he lack of nonessential details … will not render a
10                                                No. 15-1098

contract unenforceable”); Dillard, 483 F.3d at 508 (“The mate-
riality of additional written terms introduced after an oral
agreement is reached is not established simply by one par-
ty’s intransigence or ‘refusal to budge’ on the new terms.”).
Beverly implicitly acknowledges this when she refers to in-
demnification, cooperation, and future employment in cur-
sory fashion, with no attempt to explain how any of these
issues are so vital that the parties would not have settled the
dispute without them. We therefore reject Beverly’s sugges-
tion that the handwritten agreement is unenforceable due to
its silence regarding indemnification, cooperation, and fu-
ture employment. See Berkowitz, 927 F.2d at 1384.
    It bears mentioning that a transcript (or some other re-
cording) of the private mediation session here may have
provided important clarity regarding the parties’ beliefs and
intentions relating to the handwritten agreement and the
draft proposal. We encourage future litigants to record any
communications that directly relate to final settlement
agreements.
    We now turn to the remaining provisions concerning
waiver and allocation that Beverly contends are material.
Beverly argues that the handwritten agreement was not in-
tended to be final because it lacked the waiver-and-release
language that the typewritten proposal describes as “an es-
sential and material term of this Agreement and that, with-
out this provision, no agreement would have been reached
by the parties.” But the handwritten agreement states that
Beverly demanded $210,000 and mediation costs “to resolve
this matter.” Though perhaps inartful, this phrase adequate-
ly conveys Beverly’s offer to abandon her claims against Ab-
bott; the use of formal terms such as “waiver,” “release,”
No. 15-1098                                                  11

and “covenant not to sue” was unnecessary—at least regard-
ing the claims Beverly alleged in her complaint. See Wilson v.
Wilson, 46 F.3d 660, 667 (7th Cir. 1995) (holding that a set-
tlement agreement in which the plaintiff agreed to drop all
claims against the defendants in exchange for a specific sum
of money was enforceable, despite the fact that the agree-
ment did not specify whether the plaintiff’s promise would
take the legal form of a release or a covenant not to sue).
    The other purportedly material term that Beverly focuses
on is allocation. Specifically, she contends that the allocation
of the $210,000 between backpay (which is taxable) and
damages (which are not taxable) is a material term, and that
the handwritten agreement’s silence on this issue renders it
unenforceable. We conclude, however, that Beverly forfeited
this argument by failing to raise it with the district court. In
its motion to enforce the settlement agreement, Abbott stat-
ed that at the mediation, the parties agreed that a portion of
the settlement amount would be paid directly to Beverly’s
attorneys, and that the remaining amount would be split
equally between backpay and damages. In her opposition
brief, Beverly failed to rebut this statement or otherwise ref-
erence allocation, and the only purportedly “material” terms
she identified were, by her own admission, non-financial in
nature. This failure amounts to forfeiture for purposes of this
appeal. See Milligan, 686 F.3d at 386.
   Beverly proffers several arguments for why forfeiture has
not occurred, but none are availing. Beverly suggests that
the district court considered and ruled on the allocation is-
sue because the typewritten proposal, which contains an al-
location provision, was included as an exhibit in Beverly’s
opposition brief. But neither party expressly referenced this
12                                                   No. 15-1098

provision in its briefs, and the district court was under no
obligation to identify and analyze every possible way in
which the provision could be employed to either party’s
benefit. See Williams v. Dieball, 724 F.3d 957, 963 (7th Cir.
2013) (“Judges are not clairvoyant, and if they were required
to go out of their way to analyze every conceivable argu-
ment not meaningfully raised, their work would never
end.”). Nor was the allocation issue preserved simply be-
cause Abbott briefly raised the issue. See id at 962 (reasoning
that “to find that one party’s argument was preserved be-
cause his opponent defended against it out of an abundance
of caution would be to punish the opponent for being more
thorough”). In addition, Beverly invites us to interpret the
list of purportedly material provisions she identified in her
opposition brief as non-exhaustive, and to read allocation
into that list. We decline to do so. See Fednav Int’l Ltd. v.
Cont’l Ins. Co., 624 F.3d 834, 841 (7th Cir. 2010) (emphasizing
that “a party has waived the ability to make a specific argu-
ment for the first time on appeal when the party failed to
present that specific argument to the district court, even
though the issue may have been before the district court in
more general terms”).
    Beverly suggests that, despite her failure to raise the allo-
cation issue with the district court, we may nevertheless
reach the issue by exercising our discretion. “We may con-
sider a forfeited argument if the interests of justice require it,
but it will be a ‘rare case in which failure to present a ground
to the district court has caused no one—not the district
judge, not us, not the appellee—any harm of which the law
ought to take note.’” Russian Media Grp., LLC v. Cable Am.,
Inc., 598 F.3d 302, 308 (7th Cir. 2010) (quoting Amcast Indus.
Corp. v. Detrex Corp., 2 F.3d 746, 749–50 (7th Cir. 1993)). Here,
No. 15-1098                                                   13

Beverly’s failure to raise the allocation issue with the district
court precluded the parties from further developing the rec-
ord on the issue, and reasonably permitted the district court
to infer that the issue was not so important to the parties as
to constitute a material term. Beverly does not offer any rea-
son on appeal that warrants the exercise of discretion here,
and we decline to invent one. See S.E.C. v. Yang, 795 F.3d 674,
679 (7th Cir. 2015) (holding that discretionary review was
improper, in part, because the party “made no attempt to
demonstrate why his case qualifies as one of these” rare cas-
es).
                     III. CONCLUSION
   The judgment of the district court is AFFIRMED.