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Zong v. Lynch

United States District Court, E.D. Pennsylvania

September 22, 2014

RAYMOND ZONG, Plaintiff,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, a wholly owned subsidiary of Bank of America, Defendant.


RICHARD A. LLORET, Magistrate Judge.

Defendant Merrill Lynch, Pierce, Fenner & Smith Incorporated's ("Merrill") filed a Motion to Enforce Settlement. Plaintiff Raymond Zong ("Zong") has filed a response in opposition, and on August 6, 2014, I heard oral argument on the motion. The parties have consented to my jurisdiction under 28 U.S.C. § 636. (Doc. Nos. 52, 54, 55). For the reasons set forth in detail below, Merrill's Motion to Enforce Settlement will be granted.


On June 12, 2013, Zong filed a complaint alleging Title VII race discrimination and retaliation pursuant to 42 U.S.C. §§ 2000, et seq. (Doc. No. 1).[1] On May 27, 2014, Merrill and Zong reached an initial settlement agreement. Def.'s Mem. of Law in Supp. of Mtn. to Enforce Settlement at 3 ("Def.'s Mem."). Merrill forwarded to Zong a proposed settlement agreement that reflected the agreed upon terms. Id. On May 31, 2014, counsel for Zong notified Merrill that Zong refused to sign the settlement agreement for a variety of reasons.[2] Id. District Court Judge Jeffrey L. Schmehl then referred this case to me so that the parties could pursue further settlement discussions. (Doc. No. 24).

On June 23, 2014 I conducted a settlement conference with the parties. At that conference, after lengthy discussions, the parties agreed to terms of a new settlement, including an increased settlement payment for Zong. 6/23/14 Tr. at 3 (Settlement Conf.); see Def.'s Mem. at 2. The agreed upon terms were placed on the record, and the parties stated their intent to reduce the terms of the settlement to writing. 6/23/14 Tr. at 3-6. The Court, Zong's attorney, and defense counsel all took great pains to ensure that Zong fully understood and acquiesced to the terms of the settlement. Id. at 6-10.

On June 24, 2014, the day after the settlement conference, I received an email from Zong. (Doc. No. 37, Ex. A). The email alleged that Zong's attorney cheated and misinformed both me and Zong regarding a component of the settlement, and that Zong was thereby misled into settlement.[3] Id. The email asked if I could "please help cancel the [sic] yesterday's settlement agreement and keep it open for new negotiation." Id. This marked the second occasion since May 2014 on which Zong had committed to settling this case and then had second thoughts. See 8/6/14 Tr. at 9-10. At the heart of Zong's allegation of cheating and misleading was the status of his remaining EEOC claim for retaliation.[4]

Zong's attorney initially had informed Zong during the course of the day's negotiations, on June 23, 2014, that the EEOC had completed its investigation, would not be pursuing the case, and would issue a "right to sue" letter. See 8/6/14 Tr. at 20-21. After the settlement conference, thinking he had confused Zong's case with another case, Zong's attorney retracted his statement, and told Zong that the EEOC had not, in fact completed its investigation. 8/6/14 Hrg. Zong Ex. 2 (6/24/14 Cotlar email). However, after reviewing his file again, Zong's attorney realized that he was, in fact, correct the first time. The EEOC had completed its investigation of Zong's retaliation claim, had decided it would not pursue that claim, and had informed counsel it would be issuing a "right to sue" letter with regard to that claim. 8/6/14 Tr. at 20-22; Court Ex. 1. Zong's attorney immediately relayed this information to Zong. 8/6/14 Hrg. Court Ex. 1.[5]

Following Zong's June 24, 2014, email communication to the Court, Merrill filed a Motion to Enforce Settlement. (Doc. No. 39; see Doc. No. 37). Zong timely filed an opposition to this motion. (Doc. No. 46). On August 6, 2014, after briefing by the parties, I conducted a hearing on the Motion to Enforce Settlement. Importantly, Zong agreed that he had told the truth at the June 23, 2014 hearing when he agreed on the record to the terms of the settlement:

Q: Mr. Zong, I want you to turn to page 6 of the transcript there.... And, I'm going to read my question to you. "Do you understand the terms of this agreement that have been negotiated this morning?" And, then it says - Mr. Zong, what did you say? Would you read that please?
A: "Yes."
Q: All right. And, the next line is 6. "And do you agree to those terms as they've been outlined by your attorney and by the attorney for the defendants?" And, tell me what did you say? Lines 9 and 10, read that to me please.
A: "Those terms, yes, Your Honor, and also counsel discussed them."
Q: All right. Now turn to page 7. And, at line 9, I'm going to read my question to you, and then I'll ask you to read my answer - or your answer. "And, do you agree to ...

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