Appeals Court Shoots Down The Unconstitutional 'Non-Disparagement' Clauses Baltimore Attaches To Lawsuit Settlements

from the court-says-it-won't-be-a-bagman-for-hush-money dept

When the City of Baltimore agreed to settle with a victim of police brutality, it inserted the usual clauses that come with every settlement. There was the standard non-admission of wrongdoing, along with a "non-disparagement" clause the city's attorney told courts was used "in 95% of settlements" to prevent those being settled with from badmouthing the entity they sued.

Ashley Overbey received a $63,000 settlement from the city for allegations she was beaten, tased, verbally abused, and arrested after calling officers to her home to report a burglary. When a local newspaper published a story about the settlement, the City Solicitor chose to disparage Overbey by saying she was "hostile" when the police arrived at her home. As the comments filled up with invective against Overbey, she showed up in person to fire back at her detractors, claiming the police had been in the wrong and detailing some of the injuries she suffered.

The City -- which had chosen to skew public perception against Overbey by commenting on the settlement -- decided Overbey's defense of herself violated the non-disparagement clause. So, it clawed back half of her settlement -- $31,500 -- for violating its STFU clause.

Overbey sued again, claiming this clause violated her First Amendment. Now, seven years after police showed up at her home and treated like the perpetrator -- rather than a victim -- of a crime, the Fourth Circuit Court of Appeals has ruled [PDF] these non-disparagement clauses are unconstitutional bullshit.

The City argued Overbey's acceptance of the clause was actually an action of free expression. By opting for a payout, she was (and I am quoting the City here) "exercising her right not to speak in exchange for payment." Alternatively, it argued that even if it was an unconstitutional waiver of rights, the court has no reason to intercede and nullify the clause.

The court agrees that it's a waiver of rights, but disagrees about what it's allowed to do about it:

We hold that the non-disparagement clause in Overbey’s settlement agreement amounts to a waiver of her First Amendment rights and that strong public interests rooted in the First Amendment make it unenforceable and void.

It goes on to point out that the government has no business compelling speech -- i.e., violating someone's decision to not speak about something. But that's not what's going on here. The clause penalizes settlement recipients for choosing to speak, which is definitely not Constitutional.

Overbey’s promise not to speak about her case cannot be fairly characterized as an exercise of her right to refrain from speaking, because none of the interests protected by the right to refrain from speaking were ever at stake in this case. No one tried to compel Overbey to make speech she did not want to make; no one tried to punish Overbey for refusing to say something she did not want to say. Instead, Overbey agreed, on pain of contractual liability to the City, to curb her voluntary speech to meet the City’s specifications. In doing so, she waived the First Amendment protections that would have otherwise shielded her speech from government sanction.

While it is possible for people to voluntarily waive their rights in certain situations, the discussion of a settled lawsuit isn't one of these situations. Especially not when it deals with issues of considerable public interest, like allegations of police misconduct and abuse. The clause inserted into settlement agreements also drives a wedge between public agencies and the public they serve, contributing to the omnipresent distrust. In a case like this, the only purpose the clause serves is to silence speech the government doesn't like.

Standing shoulder to shoulder with the citizenry’s interest in uninhibited, robust debate on public issues is this nation’s cautious “mistrust of governmental power.” Citizens United, 558 U.S. at 340. This mistrust is one of the “premise[s]” of the First Amendment, id., and we think it well-warranted here, because the non-disparagement clause is a government-defined and government-enforced restriction on government-critical speech. Indeed, when the government (1) makes a police-misconduct claimant’s silence about her claims a condition of settlement; (2) obtains the claimant’s promise of silence; (3) retains for itself the unilateral ability to determine whether the claimant has broken her promise; and (4) enforces the claimant’s promise by, in essence, holding her civilly liable to itself, there can be no serious doubt that the government has used its power in an effort to curb speech that is not to its liking.

That unconstitutionality voids the clause.

Accordingly, we conclude that enforcement of the non-disparagement clause at issue here was contrary to the citizenry’s First Amendment interest in limiting the government’s ability to target and remove speech critical of the government from the public discourse.

The court has zero patience for the City's exhausting arguments about how unfair this is to the City:

As the City would have it, Overbey “sold her [speech] rights, with an option to buy them back, which she exercised, and now she has [her rights] again.” Id. at 39. Essentially, the City argues that half of Overbey’s settlement sum was earmarked for her silence, and that it would be unfair for Overbey to collect that half of her money when she was not, in fact, silent. When the second half of Overbey’s settlement sum is viewed in this light, it is difficult to see what distinguishes it from hush money. Needless to say, this does not work in the City’s favor. We have never ratified the government’s purchase of a potential critic’s silence merely because it would be unfair to deprive the government of the full value of its hush money. We are not eager to get into that business now.

The City will now have to give back the other half of Overbey's money. You can't beat the hell out of the First Amendment and expect to cash out. Litigants in Baltimore -- and elsewhere in the circuit -- have been freed to discuss the details of their cases in public without fear of reprisal. Hopefully, this will reduce the percentage of settlements with gag orders from 95% to 0% very quickly.

Filed Under: 1st amendment, 4th circuit, ashley overbey, free speech, non-disparagement


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  • icon
    Stephen T. Stone (profile), 18 Jul 2019 @ 12:06pm

    You can't beat the hell out of the First Amendment and expect to cash out.

    Now if only that would hold true for any corporation that uses copyright as a means to silence protected speech and suffers no penalty for it.

    reply to this | link to this | view in chronology ]

    • This comment has been flagged by the community. Click here to show it
      identicon
      Ceci est ne pas mon nom en l'ecran pour l'instant., 18 Jul 2019 @ 1:22pm

      Re: A good twist trying to support your loony notions, "Stone"!

      Now if only that would hold true for any corporation that uses copyright as a means to silence protected speech and suffers no penalty for it.

      But in fact, that might apply to the handful of anomalies Techdirt digs up in a year, and similarly omits all mention of the millions of instances every day in which copyright tries to protect the work of creators from thefts single and commercial, and to prevent grifters from getting undeserved income, so that The Public can readily enjoy works that wouldn't be made at all if only to be stolen.

      reply to this | link to this | view in chronology ]

      • icon
        Stephen T. Stone (profile), 18 Jul 2019 @ 1:28pm

        I thought you’d show up.

        Considering how you feel about corporate control of speech (you hate it) and copyright maximalism (you love it), how do you feel about corporations using copyright law to silence legally protected speech?

        reply to this | link to this | view in chronology ]

        • icon
          Gary (profile), 18 Jul 2019 @ 1:44pm

          Re:

          Considering how you feel about corporate control of speech (you hate it) and copyright maximalism (you love it), how do you feel about corporations using copyright law to silence legally protected speech?

          I think his postings speak for themselves. Blue Balls loves to whine about how Mike does it wrong - but he doesn't feel like putting forth the effort to do a better job. So he loves Corporations more than Free Speech.

          reply to this | link to this | view in chronology ]

          • identicon
            Anonymous Coward, 18 Jul 2019 @ 6:12pm

            Re: Re:

            It has gotten to the point where VALID takedown requests are insignificant anomalies--less than 1% of all requests, according to Google's published statistics.

            In all the discussions about potential changes to the DCMA, this is the most important fact. Unlike, say, the VCR which had significant legal uses (according to the Supreme Court), the DCMA takedown request process does NOT have significant legal use anymore.

            reply to this | link to this | view in chronology ]

            • identicon
              TFG, 18 Jul 2019 @ 6:31pm

              Re: Re: Re:

              First: DMCA, not DCMA.

              Second: It really is interesting how the statistical anomaly is the valid takedown when proponents of copyright will claim the exact opposite.

              reply to this | link to this | view in chronology ]

            • identicon
              David, 19 Jul 2019 @ 5:07am

              Re: Re: Re:

              It has gotten to the point where VALID takedown requests are insignificant anomalies--less than 1% of all requests, according to Google's published statistics.

              That doesn't mean that the valid takedown requests are insignificant and can be disregarded, just like 90% of Email traffic being spam does not mean that it's ok to discard the remaining 10% of valid Email.

              However, junk Emailers don't ascertain on penalty of perjury to have a legitimate cause to contact the recipient. So don't we see a whole lot more of court cases because of 99% of perjurers? In contrast to junk Email, the parties bringing takedown requests are identifiable.

              reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 18 Jul 2019 @ 6:09pm

          Re:

          reply to this | link to this | view in chronology ]

      • identicon
        Dave P., 19 Jul 2019 @ 11:04am

        Re: Re: A good twist trying to support your loony notions, "Ston

        Oh, nuts. He's about again, with his twisted mind and equally twisted notions that don't really have any bearing on the subject to hand. Paranoid about ANYTHING that might have the slightest tenuous connection with copyright and I fail to see what his inane comments have to do with THIS article. Ol' Blue (or whatever he currently calls himself) should be locked up (without internet access, of course) and the key thrown away.

        reply to this | link to this | view in chronology ]

  • icon
    Thad (profile), 18 Jul 2019 @ 12:22pm

    It's a good ruling, but will Baltimore appeal? I really don't know how SCOTUS would rule on this. While the Roberts Court tends to take a maximalist view of the First Amendment, it's also been very friendly to the theory that legal agreements can require a waiver of constitutional rights, even when one party is far more powerful than the other (see the court's decisions on private arbitration clauses).

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 18 Jul 2019 @ 12:34pm

      Re:

      SCOTUS would likely send it back to a lower court for findings specific to this case. They are unlikely to be willing to actually decide new law in this situation when there is already existing case law for the courts to base any findings on.

      reply to this | link to this | view in chronology ]

    • icon
      James Burkhardt (profile), 18 Jul 2019 @ 1:30pm

      Re:

      I think the distinction here is in the details. Its a speech restriction by the government. They would likely rule the contractual waiver would still hold except - Unlike a normal on disparagement clause, it is not enforceable by a court, but the city reserves the right to withhold the money at its discretion. If a court had adjudicated this case, questions about the lopsided contract as well as the court as a third party assessing if the city had been disparaged. But the city being a government entity was able to bypass the court adjudication of her potential contract violation. That eliminates any claim this is a normal waiver of rights - the city government holds all the power in assessing her comments against the boundaries of that waiver, which is normally a power reserved for a third party who has no direct stake in the decision.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 18 Jul 2019 @ 6:24pm

        Re: Re:

        She should have sued the city for defamation of character when the city or police dept publicly stated she became hostile.

        reply to this | link to this | view in chronology ]

        • icon
          Wendy Cockcroft (profile), 19 Jul 2019 @ 6:44am

          Re: Re: Re:

          She'd have to have proved actual harm. People making mean speech about you isn't actual harm till you're directly materially affected by it, e.g. you lose your job.

          reply to this | link to this | view in chronology ]

          • identicon
            Anonymous Coward, 23 Jul 2019 @ 8:44am

            Re: Re: Re: Re:

            The city said she was hostile to justify what the cops did to her. The city should have to prove they meant no harm disparaging her after the settlement which clearly shows the cops brutally meant to harm her.

            reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 18 Jul 2019 @ 12:55pm

    Too little, too late

    "Hopefully, this will reduce the percentage of settlements with gag orders from 95% to 0% very quickly."

    No, it won't, as there are still no consequences for a party to a dispute inserting an illegal gag order. The most they have to lose is that the clause will be unenforceable, which leaves them no worse off than if this scam were not tried.

    Now, if the consequence were that the lawyers drafting these gag orders were disbarred for doing this, or their clients exposed to additional civil or criminal sanctions (treating the attempt to gag someone as a separate offence) then maybe the number of gag orders would drop.

    It's also unfortunate that the ruling, as written, only addresses governments trying to gag people. It needs to also prohibit private entities from using the courts (which are government-funded) to gag people.

    reply to this | link to this | view in chronology ]

  • icon
    That One Guy (profile), 18 Jul 2019 @ 1:39pm

    Should have just kept your mouth shut...

    ... the city that is.

    When a local newspaper published a story about the settlement, the City Solicitor chose to disparage Overbey by saying she was "hostile" when the police arrived at her home. As the comments filled up with invective against Overbey, she showed up in person to fire back at her detractors, claiming the police had been in the wrong and detailing some of the injuries she suffered.

    Nice of them to expose their gross hypocrisy there. She wasn't allowed to say anything about the case, to the point that she was punished for defending herself, but the city retained for itself the right to say whatever they wanted, and had no problem slamming the very person they had gagged from talking about the case.

    reply to this | link to this | view in chronology ]

    • icon
      Hugo S Cunningham (profile), 18 Jul 2019 @ 4:17pm

      Re: Should have just kept your mouth shut...

      Precisely. To remain valid, non-disclosure agreements should apply to both sides. Similarly with pre-trial gag orders: if the prosecution starts leaking prejudicial information to sympathetic reporters in the local (or national) media, the defense should be free to defend themselves publicly.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 18 Jul 2019 @ 5:01pm

    Once the city started disparaging her in public why should she be forced to keep silent? If they wanted her to keep silent, they should have kept silent.

    reply to this | link to this | view in chronology ]

  • identicon
    David, 18 Jul 2019 @ 8:44pm

    Stop -- right -- now!

    Ashley Overbey received a $63,000 settlement from the city for allegations she was beaten, tased, verbally abused, and arrested after calling officers to her home to report a burglary.

    and

    Now, seven years after police showed up at her home and treated like the perpetrator -- rather than a victim -- of a crime,

    Are you bullshitting me? Since when is it the job of the police to beat, tase, and verbally abuse the perpetrator of a crime? It is the job of the police to apprehend suspects. What kind of country are you living in if even the people supposedly against police violence do not worry about the use of excessive violence while the police deems itself qualified to act as judge and executioner but instead complains that the police misjudged about who to beat up, tase, and verbally abuse?

    Misjudgments happen. There are processes of appeal for correcting the consequence. The problem here was not the misjudgment. The problem was what happened as the consequence of the misjudgment. It's not the job of the police to mete out punishment.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Jul 2019 @ 6:33am

      Re: Stop -- right -- now!

      Apparently law enforcement is not applied equally across class boundaries, income levels, races, and religions, never has been.

      reply to this | link to this | view in chronology ]

    • icon
      nasch (profile), 19 Jul 2019 @ 8:20am

      Re: Stop -- right -- now!

      Since when is it the job of the police to beat, tase, and verbally abuse the perpetrator of a crime?

      He didn't say that's their job, he said that's how they treat perpetrators (and others). Which is all too often true.

      What kind of country are you living in if even the people supposedly against police violence do not worry about the use of excessive violence

      What makes you think people don't worry about it? Is this the first TechDirt article you've read? Because they talk about how terrible abusive policing is all the time.

      reply to this | link to this | view in chronology ]

      • identicon
        David, 19 Jul 2019 @ 1:34pm

        Re: Re: Stop -- right -- now!

        More often than not it's about police abusing the "wrong target" rather than about police abusing people, period. Sometimes because the target is innocent of the suspected crime, less often because the evidence has been gathered in a manner where its use in court would be unconstitutional.

        But if police beats up a criminal or shoots them in the back or an invasive body search does turn up drugs, it's not newsworthy in the U.S.

        And that makes people miss the fact that the problem is not that the police sometimes get the wrong people. The problem is that the police treats suspects like trash.

        reply to this | link to this | view in chronology ]

    • icon
      That One Guy (profile), 19 Jul 2019 @ 2:29pm

      Required vs Allowed

      Since when is it the job of the police to beat, tase, and verbally abuse the perpetrator of a crime?

      Easy mistake to make, you see those aren't part of the job(something they are supposed to do), rather they're perks of it(something they are allowed to do).

      (I really wish I could add an /s to that...)

      reply to this | link to this | view in chronology ]


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