sexual harassment

Agreement “Not to Disparage One Another” Does Not Preclude Sexual Harassment Lawsuit

Mediation is a popular way for people to settle grievances without the cost and hassle of a trial. As part of mediation, parties may sign an agreement that includes a list of obligations, such as a clause that they will not “disparage” each other to other entities. However, signing such an agreement does not mean that the individual has waived their right to engage in protected activity, as evidenced by the 2019 California case Doe v. Olson. For California employers, sexual harassment prevention training can help maintain a positive workplace and good reputation better than non-disparagement clauses.

Jane Doe and Curtis Olson worked together from 2013-2015 to convert a historic apartment building into condominiums and register it on the National Register of Historic Places. Olson was the owner of the building, with Doe acquiring a condominium unit in exchange for working to make the building a historic landmark.

In October of 2015, Doe applied for a restraining order (CHRO) against Olson for sexually forcing himself on her in front of her friends, hiring people to photograph her in private, and looking through her window, among other sexual harassment-related incidents. Doe claimed in her CHRO application that Olson once threatened to kill her. Olson responded that he believed Doe was retaliating against him as Home Owners’ Association president for a letter that ordered her to cease and desist from HOA violations.

Both parties agreed to mediation by California Academy of Mediation Professionals (CAMP). Doe appeared alone, and Olson appeared with counsel. Both parties signed a “Mediation/Confidentiality Agreement” that included a provision prohibiting either from disparaging the other for three years.

In August of 2016, Doe reported the same incidents to the U.S. Department of Housing and Urban Development (HUD), who referred her complaint to the California Department of Fair Employment and Housing (DEFH). DEFH indicated that it would investigate the allegations.

In December of 2016, Doe filed a civil suit for damages on numerous causes of action stemming from the same harassing behavior included in the CHRO application and HUD/DEFH complaint. Olson filed a cross-complaint based on Doe’s breach of contract, arguing that in repeating her sexual harassment allegations she was “disparaging” him in violation of the Mediation Agreement. He asked that the court enforce the clause and silence her sexual harassment claim. Doe responded that his complaint was barred because he filed suit only to discourage her from pursuing her claim, and moved to strike his cross-claim. The trial court rejected Olson’s argument and granted Doe’s motion.

Olson appealed. The Court of Appeal considered the purpose of the anti-SLAPP statute, and whether the signing Mediation Agreement waived Doe’s right to invoke it. Anti-SLAPP statutes discourage retaliatory litigation by subjecting cross claims to an extra level of scrutiny. Their purpose is to protect citizens from litigation for reporting wrongdoing to government agencies. For example, an employee in California whose employer reports suspicious activity to the police cannot then sue the employer for slander. Individuals may waive their right to invoke the anti-SLAPP statute if they engage in conduct expressly forbidden by a contract.

The court held that Olson’s cross-claim had some merit, and reversed the earlier motion to strike his cause of action for breach of contract. The court rejected his arguments regarding specific performance (silencing Doe’s sexual harassment complaints) and affirmed the trial court’s rejection of that cause of action.

Settlement agreements that include a confidentiality clause may encourage parties not to pursue litigation following a sexual harassment claim, but individuals who sign such agreements are still protected by other statutes that can overpower the contract. This case demonstrates that even when there is an agreement to keep allegations of sexual harassment quiet, there is still a chance for litigation. Confidentiality following a report of sexual harassment is most efficiently ensured by preventing the sexual harassment from ever happening. Under state law, employers with five or more employees are required to provide sexual harassment prevention training. Doe v. Olson shows that proactive, thorough California sexual harassment training can help prevent tarnishing a reputation better than an after-the-fact confidentiality agreement.

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