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Signed Releases Cook Plaintiff's Harrassment Suit Against McDonald's (NY)

July 25, 2013

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It is not uncommon for a party who signs a pre-suit release to have "buyers remorse" and decide to file suit anyway.  The issue recently arose in <a href="" target="_blank" rel="noopener"><i>Nelson v. Lattner Enters. Of N.Y.</i></a>, where, despite signing a release, plaintiff sued a McDonald’s franchisee and the McDonald’s Corporation for sex discrimination and sexual harassment.

Plaintiff was a restaurant manager for the franchisee for approximately six years, and reported to the Corporation that her supervisor, Lattner, repeatedly subjected her to sexual harassment. During a meeting in December 2007, plaintiff signed a handwritten settlement agreement, consenting to leaving her employment and releasing all claims in exchange for severance payment and medical benefits.  In a subsequent meeting, plaintiff signed a typed settlement agreement and release which comprehensively released all defendants from any liability in exchange for severance pay of $18,688.10 and continued medical benefits.

When bringing suit against the defendants, plaintiff claimed that the signed releases were not valid and should be void because she signed them under duress.  The trial court dismissed plaintiff’s action and the Second Department affirmed the dismissal of the claims.  Even assuming that plaintiff was under duress when signing the handwritten first agreement, the Court found that she was not under duress when signing the second typed agreement.

In the second meeting, plaintiff was unable to demonstrate any unlawful act that compelled her to sign.  Further, the Court noted that the typed agreement indicated in bold that she should consult with an attorney, that she had 21 days to consider the agreement, and that she could even revoke the release up to seven days after signing it.  Notwithstanding the language in the agreement, the Court also found that plaintiff’s conduct waived her objections and ratified the agreement by accepting and retaining the benefits for nearly two years before bringing suit in 2009.

Thanks to Jung Lee for his contribution to this post.  If you would like more information please write to <a href="" target="_blank" rel="noopener">Mike Bono</a>.


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