Disclosure of Settlement Agreements

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Dear Ms. Moriarty and Ms. Bozen:

This binding opinion is issued by the Attorney General pursuant to section 9.5(f) of the Freedom of Information Act (FOIA) (5 ILCS 140/9.5(f) (West 2022), as amended by Public Act 103-069, eBective January 1, 2024). For the reasons discussed below, this oCce concludes that Homer Township (Township) violated the requirements of FOIA by withholding a settlement agreement responsive to Ms. Ellen Moriarty's October 2, 2023, FOIA request.

BACKGROUND

On October 2, 2023, Ms. Moriarty submitted by e-mail a FOIA request to the Township seeking "the invoices and all relevant documents that support" nine speciFc checks, identiFed by check number and amount, payable to the Township's law Frm or its law Frm's not indicate any responsive information had been redacted or withheld, nor did the Township specify the bases for its redactions. On October 24, 2023, this oCce received Ms. Moriarty's Request for Review challenging the Township's response. In particular, she alleged that the Township's response was incomplete because it failed to provide the relevant records for check number 45079, for $22,950.00, which she indicated was payable to the law Frm's trust fund.’ Although she expressed concern over the "erratic and convoluted" manner in which the Township provided the records to her, she did not contest the Township's redactions to the legal invoices.

In an attempt to mediate this matter, on November 1, 2023, an Assistant Attorney General (AAG) in the Public Access Bureau e-mailed the Township Clerk a copy of Ms. Moriarty's Request for Review and asked if the Township Clerk had availability to discuss the matter.> Alternatively, the AAG suggested that if the Township had overlooked any responsive records, the Township may wish to disclose those records to Ms. Moriarty in a supplemental response.° In telephone calls on November 7, 2023, and November 9, 2023, the AAG spoke with the Township Clerk. During those calls, the Township Clerk explained that the Township had inadvertently omitted a copy of check 45079 from its response to Ms. Moriarty, but she was concerned that releasing the remaining responsive records related to the check would subject the Township to legal liability.’ She stated that she was unsure what FOIA exemption applied to the On November 13, 2023, the Public Access Bureau e-mailed the Township a copy of the Request for Review’ and a letter!? asking it to provide, for this oCce's conFdential review, copies of the withheld records. This oCce also requested that the Township provide a written answer describing its legal and factual bases for withholding the records, including the speciFc exemption(s) the Township is asserting to withhold the records.'!! On November 14, 2023, the Township provided this oCce with unredacted copies of check 45079 and one withheld responsive record, a settlement agreement.'* The Township also provided a conFdential explanation of its reason for withholding the settlement agreement, but it did not specify the FOIA exemption upon which the Township relied. !° In an additional attempt to mediate this matter, on November 20, 2023, by telephone and e-mail,'* the AAG directed the Township Clerk to section 2.20 of FOIA (5 ILCS 140/2.20 (West 2022)), which provides that "[a]ll settlement and severance agreements entered into by or on behalf of a public body are public records subject to inspection and copying by the public, provided that information exempt from disclosure under Section 7 of this Act may be redacted." The AAG stated that section 2.20 speciFcally identiFes settlement agreements as public records open to inspection, and asked the Township to copy this oCce if it issued a supplemental response disclosing the withheld record.'!> On November 22, 2023, the Township On November 29, 2023, the Township provided by e-mail a non-conFdential written answer to this oCce's November 13, 2023, letter.!’ On November 30, 2023, this oCce forwarded the Township's answer to Ms. Moriarty.'® She did not reply. In a December 6, 2023, telephone call with the AAG who forwarded the letter, Ms. Moriarty conFrmed that receipt of a copy of the settlement agreement would resolve her Request for Review.'? Accordingly, the scope of this opinion is limited to whether the settlement agreement is subject to disclosure.

On December 18, 2023, this oCce extended the time for issuing a binding opinion by 30 business days, to February 8, 2024, pursuant to section 9.5(f) of FOIA.*°

ANALYSIS

"All records in the custody or possession of a public body are presumed to be open to inspection or copying. Any public body that asserts that a record is exempt from disclosure has the burden of proving by clear and convincing evidence that it is exempt." 5 ILCS 140/1.2 (West 2022). Section 3(a) of FOJA (5 ILCS 140/3(a) (West 2022)) provides that "[e]ach public body shall make available to any person for inspection or copying all public records, except as otherwise provided in Sections 7 and 8.5 of this Act." The exemptions from disclosure contained in section 7 of FOIA (5 ILCS 140/7 (West 2022), as amended by Public Acts 103-154, eBective June 30, 2023; 103-462, eBective August 4, 2023; 103-446, eBective August 4, 2023) are to be narrowly construed. Lieber v. Board of Trustees of Southern Illinois University, 176 Ill. 2d 401, 407 (1997).

As noted above, section 2.20 of FOIA expressly provides that "[a]ll settlement agreements entered into by or on behalf of a public body are public records subject to inspection estate of a decedent, but remanded the case for consideration of whether portions of the records could be redacted under exemptions in section 7 of FOIA. Rushton, 2019 IL 124552, 7 41.

In its written response to this oCce, the Township does not contend that any portion of the settlement agreement is exempt pursuant to a speciFc exemption in FOIA. Rather, the Township stated that it withheld the settlement agreement in its entirety because of the agreement's "Mutual Non-Disparagement" clause.*! The Township described the clause as stating "that any party that disparages the other can be liable for damages of $15,000 or actual damages whichever is greater." The Township argued that if it disclosed the settlement agreement, "it could cause harm to either party for a multitude of reasons. One reason would be the posting of this on social media and possible negative comments which could tarnish the business name and ultimately, we could be held liable for."*° The legislative history of Senate Bill 189 (which, as Public Act 96-542, eBective January 1, 2010, added section 2.20 to FOJA) reZects that the General Assembly did not intend to permit public bodies to incorporate non-disclosure agreements or other restrictions in settlement agreements to avoid disclosing the terms of the settlements in response to FOIA requests. The comments of Representative Madigan, one of the House sponsors of Senate Bill 189, and Representative Black are particularly illuminating:

Black: Okay, settlement agreements entered into, and this has long been a bone of contention, a school district, a city, a township, a county, whatever[.| They reach an agreement on a lawsuit. They don't go to court. They settle for an amount of money, and this [has] often driven the taxpayer as well as the media gatekeepers crazy. Well, that did... how much did it cost? Well, we don't have to tell you that. We what you're saying, that settlement would now be FOlable.

Madigan: The answer is yes. Remarks of Rep. Black and Rep. Madigan, May 27, 2009, House Debate on Senate Bill No. 189, at 104-105.

In addition, this colloquy between Representative Tryon and Representative Madigan reiterated that the purpose of section 2.20 is to mandate the release of settlement agreements, subject only to permissible redactions:

Tyron: Speaker Madigan[,] having been a former county board chairman, we were faced many times with FOIA requests and sometimes diCcult FOIA requests and one of the things that was awful diCcult was in the cases of settlements of court cases. In the settlement of a court case, there were times where the plaintiB was requesting that there be * * * nondisclosure. It could have been a sexual harassment case; it could have been certain types of cases where there was a need to disclose the names of the individuals maybe even the amount of the settlement. If the court approves a settlement agreement that, as part of that settlement agreement, has nondisclosure, is that FO]Aable?

Madigan: The answer is that [is] a public record that would be subject to FOIA, but please understand that you do have exceptions in the statutes such as privacy, deliberative process.

Tryon: So that doesn't...

Madigan: Let me also add, you can do redactions.

Tryon: Okay.

Madigan: You can do redactions.

Tryon: So, * * * if part of the settlement was negotiated and part of the negotiation of the settlement [was] approved by a court and in one speciFc case I'm thinking of was a Federal Court and the Madigan: Again, it's subject to FOIA, but let me add that the intent of this Bill is not to look with favor upon governments entering into sealed records and sealed agreements of court. I mean, that's part of what we're trying to do here. We're trying to open things up.

Tryon: Okay.

Madigan: And we certainly would not want to be encouraging governments to enter into agreements like that.

Tryon: Okay. And certainly, in cases of privacy then you're saying that the exception would apply possibly to names and that type of thing?

Madigan: The answer is yes. Remarks of Rep. Madigan and Rep. Tryon, May 27, 2009, House Debate on Senate Bill No. 189 at 109-111.

In accordance with the plain language of section 2.20 and this legislative history, the Attorney General has issued binding opinions clarifying that conFdentiality provisions within settlement agreements do not supersede FOJA's requirement to disclose those agreements to the public. Ill. Att'y Gen. Pub. Acc. Op. No. 14-004, issued May 9, 2014, at 9-10 ("Because conFdentiality provisions in settlement agreements entered into by public bodies are contrary to the speciFc language of section 2.20 and the legislative intent underlying that section, this oCce Fnds that the conFdentiality provisions in the settlement agreements are not enforceable[.]");

see Ill. Gen. Pub. Acc. Op. No. 15-004, issued June 17, 2015, at 4 (Fnding that a conFdentiality provision did not authorize a city to withhold a settlement agreement requested under FOIA).

Because the withheld record is a settlement agreement between the Township and another party, it is a public record subject to disclosure. The Township's sole basis for withholding the record is a mutual nondisparagement clause, the language of which does not expressly or implicitly prohibit disclosure of the agreement itself. Black's Law Dictionary deFnes "nondisparagement clause" in relevant part as "[a] contractual provision prohibiting the parties from publicly communicating anything negative about each other." Black's Law Dictionary 315 (11th ed. 2019). It appears that the Township's position is that disclosure of the settlement agreement pursuant to FOIA would necessarily be a "negative" communication about the other party and/or that disclosure of the record could lead to others disparaging the other party, which the Township believes would expose it to potential liability. The Township's nondisparagement clauses to circumvent the disclosure requirements of section 2.20 of FOIA, the purpose of that provision would be defeated. See People v. Latona, 184 Ill. 2d 260, 269 (1998) ("[T]his court has a duty to avoid a construction of [a] statute that would defeat the statute's purpose or yield an absurd or unjust result."). Accordingly, the Township violated the requirements of FOIA by withholding the responsive settlement agreement based on a mutual nondisparagement clause.

FINDINGS AND CONCLUSIONS

After full examination and giving due consideration to the information submitted, the Public Access Counselor's review, and the applicable law, the Attorney General Fnds that:

1) On October 2, 2023, Ms. Ellen Moriarty submitted a FOJA request to Homer Township seeking "the invoices and all relevant documents that support" nine speciFc checks payable to the Township's law Frm or its trust fund.

2) On October 10, 2023, the Township provided Ms. Moriarty with responsive records for eight of the checks, but did not provide any records for check 45079.

3) On October 24, 2023, Ms. Moriarty Fled a Request for Review with the Public Access Counselor alleging that the Township's response was incomplete. The Request for Review was timely Fled and otherwise complies with the requirements of section 9.5(a) of FOIA (5 ILCS 140/9.5(a) (West 2022), as amended by Public Act 103-069, eBective January 1, 2024).

4) On November 13, 2023, the Public Access Bureau forwarded a copy of the Request for Review to the Township along with a letter requesting copies of the unredacted records for this oCce's conFdential review and a written answer specifying the FOJA exemption(s) under which it was withheld, and a factual and legal basis for the applicability of any such exemption. On November 14, 2023, the Township provided the requested records and a conFdential written answer.

5) On November 20, 2023, an AAG suggested, based on section 2.20 of FOIA, that the Township consider providing the settlement agreement to Ms. Moriarty. On November 22, 2023, the Township declined to do so.

6) On November 29, 2023, the Township provided a non-conFdential version of its answer to this oCce. On November 30, 2023, the Public Access Bureau forwarded that answer to Ms. Moriarty. Ms. Moriarty did not reply to that answer, but in a December 6, 2023, 7) On December 18, 2023, the Public Access Bureau extended the time in which to issue a binding opinion by 30 business days pursuant to section 9.5(f) of FOIA. Therefore, the Attorney General may properly issue a binding opinion with respect to this matter.

8) Section 2.20 of FOIA speciFcally provides that all settlement agreements entered into by or on behalf of a public body are public records subject to inspection and copying by the public.

9) The responsive record is a settlement agreement entered into by the Township. The settlement agreement does not contain a provision prohibiting disclosure. Even if it did, such provision would be unenforceable because it would defeat the purpose of section 2.20 of FOIA.

Therefore, it is the opinion of the Attorney General that Homer Township has violated FOIA by withholding the settlement agreement responsive to Ms. Ellen Moriarty's October 2, 2023, Freedom of Information Act request. Accordingly, the Township is hereby directed to take immediate and appropriate action to comply with this opinion by providing Ms. Moriarty a copy of the settlement agreement.

This opinion shall be considered a Fnal decision of an administrative agency for the purposes of administrative review under the Administrative Review Law. 735 ILCS 5/3-101 et seq. (West 2022). An aggrieved party may obtain judicial review of the decision by Fling a complaint for administrative review with the Circuit Court of Cook County or Sangamon County within 35 days of the date of this decision naming the Attorney General of Illinois and Ms. Ellen Moriarty as defendants. See 5 ILCS 140/11.5 (West 2022).

Sincerely,

KWAME RAOUL

TTORNEY GENERAL

By:

Brent D. Stratton Chief Deputy Attorney General served a copy of the foregoing Binding Opinion (Public Access Opinion 24-001) upon:

Ms. Ellen Moriarty 13841 South Twin Oaks Court Homer Glen, Illinois 60491 [email protected] The Honorable Vicki Bozen Clerk Homer Township 14350 West 151st Street Homer Glen, Illinois 60491 [email protected] by causing a true copy thereof to be sent electronically to the addresses as listed above and by causing to be mailed a true copy thereof in correctly addressed, prepaid envelopes to be deposited in the United States mail at Chicago, Illinois on January 24, 2024.