The Hollywood Reporter - 26.02.2020

THE HOLLYWOOD REPORTER 28 FEBRUA RY 26, 2020

The Business

Illustration by Hanna Barczyk

Analysis

I

n the Feb. 19 Democratic

debate, Mike Bloomberg

faced calls to waive his

non-disclosure agreements

(NDAs) with women who had

made sexual harassment claims

against him. Bloomberg, and

other men in positions of power

or public office, should consider

whether using NDAs is advis-

able. It’s appropriate to ask them

to waive those agreements or

face the negative inferences that

come from entering them in the

first place. At the same time,

women should not be forced to

forgo their right to sign an NDA

if they wish to keep a painful and

traumatic event confidential or

to avoid the ordeal of a public

trial. Restrictions on this choice

— such as California’s recently

enacted law prohibiting survivors

from entering into NDAs after

filing civil lawsuits — ultimately

remove survivors’ autonomy and

deter defendants from settling.

When settling sexual assault or

harassment cases, both parties

often have an interest in preserv-

ing their privacy. Survivors wish

to avoid public attention and

criticism, the burden of a trial

and the label of “victim” that

No NDA, No Settlement

A California law designed to protect sexual assault and harassment victims from forced silence

is instead removing their ability to opt for privacy — the exact opposite of its intention

assumption that a settlement

validates the initial allegations —

defendants have little incentive

to settle once a case is filed, even

if the plaintiff ultimately wants

a settlement that comes with an

NDA. Without an NDA, defen-

dants have virtually no incentive

to agree to a plaintiff’s request for

anonymity. So while the law theo-

retically leaves a privacy option

available, there is no reason for

defendants to agree to it.

Indeed, because California’s

NDA restriction applies only

to cases that have been filed, it

may have the unintended conse-

quence of increasing the secrecy

of sexual harassment and assault

cases. Survivors still can choose

to settle with an NDA as long as

a case is not filed. This feature of

California’s law curtails survi-

vors’ ability to choose to file and

then settle a lawsuit and forces

them to proceed with public

litigation or settle without filing

anything. For survivors who

choose the latter option, there

will be no public record that a

complaint was ever made.

Furthermore, the value of

a settlement to a defendant

decreases significantly if a

plaintiff can continue to speak

out against the defendant to third

parties. Defendants may instead

choose to aggressively defend and

litigate their case, meaning plain-

tiffs may not recover anything.

At best, plaintiffs will be forced

to endure protracted litigation

during which a period of their

life they may wish to keep private

is litigated in the courts and the

press, at significant emotional

and financial expense.

California’s NDA restriction

was well intentioned. But in

practice, it takes away survivors’

ability to choose to keep their

cases confidential and deters

defendants from resolving dis-

putes before trial. This harms

survivors of sexual harassment

and assault by removing their

choice and forcing them to endure

the hardship and uncertainty of

a public trial as the only means of

vindicating their claims.

can accompany such allegations.

Meanwhile, defendants might be

worried about their reputation

and don’t want claims to become

public. These concerns often

prompt parties to employ NDA

provisions in settlement agree-

ments that prohibit either party

from discussing the survivor’s

allegations, the defendant’s

defenses or the terms of the deal.

The #MeToo movement led to

an injudicious reexamination of

a civil action or a complaint filed

in an administrative action” if

those claims include allegations

of sexual assault, sexual harass-

ment or workplace harassment or

discrimination based on sex.

There are some exceptions.

Parties may agree to keep the

settlement amount private and

the identity of the claimant con-

fidential, although this exception

doesn’t apply if a government

agency or public official is a party

GUEST COLUMN | JILL BASINGER & MICHAEL L. SMITH

JILL BASINGER is an entertainment

litigation partner, and

MICHAEL L. SMITH is an associate

at Glaser Weil in Los Angeles.

Instead of empowering survivors, these laws

are paternalistic restrictions that deprive

them of their autonomy to decide whether their

experiences should remain confidential.

the use of NDAs in these types

of cases. Critics argue that NDAs

aid repeat offenders because

survivors of sexual assault and

harassment are barred from tell-

ing their stories to third parties,

including the media. As a result,

critics claim, the public remains

unaware of the danger of serial

harassers. One manifestation of

this criticism is legislation that

bans or restricts the use of NDAs

in these cases, which Gov. Jerry

Brown signed into law in 2018.

Section 1001 of the California

Code of Civil Procedure bans set-

tlement provisions that prohibit

“the disclosure of factual infor-

mation related to a claim filed in

to the settlement. Still, section

1001 remains a blunt instrument.

Instead of empowering sur-

vivors, these paternalistic laws

remove survivors’ autonomy to

decide whether their experiences

should remain confidential. By

assuming survivors lack the judg-

ment to determine whether to

enter NDAs, these laws infantilize

survivors and deprive them of

their agency. They deter settle-

ments and harm the survivors

they were meant to protect.

Faced with the prospect of

plaintiffs continuing to speak

out about alleged harassment

or assault — and the harm

associated with the widespread