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Dated: April 7, 2000
Case No. 2000-CAA-00001
In the Matter of
HUGH L. HONDORP
Complainant
v.
ASHLAND CHEMICAL COMPANY
Respondent
RECOMMENDED ORDER APPROVING SETTLEMENT and DISMISSING THE COMPLAINT
This case arises under the Clean Air Act (CAA), 42 U.S.C. § 7622 (1988). On April
4, 2000, the parties submitted their "Settlement Agreement and General Release." Pursuant to the
Settlement Agreement, the parties also submitted a "Joint Motion for Dismissal with Prejudice,"
requesting dismissal of the complaint with prejudice. The parties seek approval of the settlement and dismissal
of the complaint.
The Settlement Agreement (¶ 4) provides that Respondent shall pay Complainant
specified amounts, including Complainant's attorney's fees and costs. The Settlement Agreement (¶ 12)
also provides protections for Complainant with respect to references that Respondent shall provide to prospective
employers.
I must determine whether the terms of the agreement are a fair, adequate and reasonable
settlement of the complaint. Marcus v. U.S. Environmental Protection Agency, ALJ Case Nos. 96-CAA-
3, 7, ARB Case No. 99-027 (Oct. 29, 1999).
[Page 2]
Paragraph 2 of the Settlement Agreement provides that Complainant releases Respondent
from claims arising under the CAA as well as under various other laws. This review is limited to
whether the terms of the settlement are a fair, adequate and reasonable settlement of Complainant's allegations
that Respondent violated the CAA. Poulos v. Ambassador Fuel Oil Co., Inc., Case No. 86-CAA-1. Sec'y
Order, slip op. at 2 (Nov. 2, 1987).
Paragraph 10 of the Settlement Agreement provides that Complainant shall not reveal its
terms or his allegations against Respondent, but includes an exception allowing Complainant to disclose the
contents of the agreement in order to respond to an inquiry from a governmental agency, or pursuant to court
order. The confidentiality provision in paragraph 10 of the Settlement Agreement could be considered to
constitute a "gag provision" that is unacceptable as being against public policy if it precludes
Complainant from communicating with federal or state enforcement agencies concerning alleged violations of law.
However, I interpret paragraph 10 as not preventing Complainant, either voluntarily or pursuant to an order or
subpoena, from communicating with, or providing information to, state or federal authorities about suspected
violations of law involving Respondent. Therefore, paragraph 10 does not contain an invalid gag provision.
Thornton v. Burlington Environmental and Phillip Environmental, 94-TSC-2, Sec'y Final Order
Approving Settlement and Dismissing Complaint (Mar. 17, 1995).
On the other hand, in the event that the language in paragraph 10 bars Complainant from
voluntarily communicating with, or providing information to, governmental agencies, paragraph 10 is herewith
found void and is severed from the Settlement Agreement, pursuant to paragraph 16. Paragraph 16 of the
Settlement Agreement provides for severability of invalid provisions by "a Court of competent
jurisdiction" (which I construe to include myself as a federal administrative law judge, or the Administrative
Review Board, with jurisdiction over this matter). Paragraph 16 of the Settlement Agreement, in its entirety,
states:
Should any provision of this Agreement be declared or determined by a
Court of competent jurisdiction to be illegal, invalid or unenforceable, the legality, validity and enforceability
of the remaining parts, terms or provisions shall not be affected thereby and said illegal, unenforceable or invalid
part, term or provision shall be deemed not to be part of the Agreement.
In Brown v. Holmes & Narver, Inc., Case No. 90-ERA-26, Final Order Approving
Settlement and Dismissing Complaint, slip op. at 2 (May 11, 1994), the Secretary of Labor found a similar
settlement provision to be void as contrary to public policy and unenforceable. However, based on the
agreement's severability provision, the Secretary severed the offending provision from the approved settlement,
stating:
The severance provision permits me to approve the remainder of the Agreement without
the offending language prohibiting the parties from discussing the facts surrounding the complaint with
government agencies.1
1In Paine v. Saybolt, Inc., ALJ Case
No. 97-CAA-4, ARB Case No. 97-102, ARB Order Disapproving Settlement and Remanding the Case
(July 22, 1997), the ARB stated that it could not sever or modify material terms of a negotiated
settlement. For this proposition, the ARB cited Macktal v. Secretary of Labor , 923 F.2d
1150, 1154-56 (5th Cir. 1991). However, Macktal is inapposite because it appears that in that
case the settlement agreement did not contain severability language, while in the instant case the
settlement agreement itself provides for the severance of any provision found to be improper by a court
of competent jurisdiction. Macktal stated that the Secretary could not sever an offending
provision "without the consent of the other two parties." 923 F.2d at 1155-56.
Macktal was distinguished in Brown v. Holmes & Narver, Inc., supra.
In the instant case paragraph 16 of the Settlement Agreement provides the parties' consent to severance.
2However, there is no provision in the
Settlement Agreement designating anything in it as confidential commercial information pursuant to
29 C.F.R. § 70.26(b).