Family Dollar Stores of Missouri, LLC v. TSAI's Investment, Inc

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

FAMILY DOLLAR STORES OF )

MISSOURI, LLC, )

)

Plaintiff, )

)

v. ) No. 4:21-CV-572-SRW

)

TSAI’S INVESTMENT, INC., )

)

Defendant. )

MEMORANDUM AND ORDER

This matter is before the Court on Plaintiff Family Dollar Stores of Missouri, LLC’s

Motion to Alter or Amend Judgment, ECF No. 90, and Motion to Enforce Settlement

Agreement, ECF No. 93. The motions are fully briefed. On February 28, 2023, the Court held an

evidentiary hearing, and these motions are now ready for disposition. The parties consented to

the jurisdiction of the undersigned United States Magistrate Judge pursuant to Title 28 U.S.C.

§ 636(c). For the reasons discussed below, the Court will deny the Motion to Alter or Amend

Judgment and Motion to Enforce Settlement Agreement.

Background

On September 30, 2019, Plaintiff Family Dollar Stores of Missouri, LLC (“Family

Dollar”) negotiated and entered into a Lease Agreement (the “Lease”) with Defendant Tsai’s

Investment, Inc. (“Tsai”) for a commercial premises located at 8618 Olive Boulevard, University

City, Missouri (the “Premises”). In May of 2020, the City of University City filed a Petition in

Eminent Domain, which included the Premises. Consequently, Family Dollar vacated the

Premises by June 28, 2021, and Tsai was awarded $6,368,700.00 by a state court as

compensation for the taking.

Family Dollar filed the instant action on May 17, 2021 asserting allegations related to the

Lease, and subsequently filed an amended complaint on July 14, 2021. Tsai filed a motion to

dismiss the amended complaint, which the Court granted in part. On April 6, 2022, Family

Dollar filed a second amended complaint alleging two counts: Count I: breach of lease; and

Count II: breach of implied covenant of good faith and fair dealing. On April 27, 2022, in

response to the second amended complaint, Tsai filed a motion for judgment on the pleadings as

to Count I, and a motion to dismiss as to Count II. On November 9, 2022, the Court granted both

of Tsai’s motions and this action was dismissed.

The parties filed three post-judgment motions. Tsai, identifying itself as the prevailing

party, filed a motion seeking attorney’s fees in the amount of $128,874.50. ECF No. 86. Family

Dollar subsequently filed the two instant motions requesting the Court to deny Tsai’s motion for

attorney’s fees, amend its November 9, 2022 judgment, and enter an order to enforce a

settlement agreement that Family Dollar claims was orally agreed upon by the parties prior to the

Court’s dismissal.

Family Dollar’s Motion to Alter and Motion to Enforce Settlement

In support of its two post-judgment motions, Family Dollar summarizes the email and

telephone correspondence it had with Tsai from October 12, 2022 to November 23, 2022.

Attached to the motions are copies of the emails between the parties. See ECF Nos. 91 and 94.

The timeline provided by Family Dollar in its’ briefing is as follows:

• October 12, 2022: Matthew Layfield (counsel for Family Dollar) sent an e-mail to J.

Vincent Keady (counsel for Tsai) with “a settlement proposal and offer” for Tsai’s

review. ECF No. 91-1 at 2. The proposal was in the form of a one-page letter. ECF

No. 92-1 at 7.

• October 13, 2022: Mr. Keady responded and asked Mr. Layfield to forward “the

proposed settlement and release agreement incorporating the terms outlined in [the]

letter” so he could review it with Tsai. ECF No. 91-3 at 2.

• October 27, 2022: Mr. Layfield emailed a draft ‘Settlement and Release’ with the

following disclaimer: “This is subject to our client’s review and comment still, but

wanted to get in your hands without further delay.” ECF No. 91-4 at 2.

• October 28, 2022: Mr. Keady responded, “Our client has requested [] some revisions.

Attached is a redlined and clean version thereof.” ECF No. 91-5 at 2. The redline,

among other edits, deleted the Confidentiality and Non-Disparagement provisions

included in the original draft settlement. See ECF No. 92-1 at 34-42.

• Mr. Layfield attests, via Affidavit, that on October 31, 2022, he called Mr. Keady to

discuss the redline. ECF No. 91-2, ¶ 10. Mr. Layfield “advised Keady that [he]

thought the removal of these sections would ultimately be acceptable to [Family

Dollar] and would confirm the same[.]” Id. Mr. Layfield further asserts that, at the

time of the call, he considered this matter settled. Id.

• November 9, 2022: The Court granted Tsai’s motion for judgment on the pleadings

and motion to dismiss. ECF Nos. 84, 85.

• November 19, 2022: Mr. Keady sent an e-mail to Mr. Layfield stating, “We never

received a response to our suggestions . . . . To whatever extent they were interpreted

as a counter offer, they are hereby withdrawn; and, to be clear, any and all proposals

from you[r] client have already been rejected.” ECF No. 91-6 at 3.

On November 23, 2022, Mr. Layfield sent Mr. Keady the following email in response to

the November 19th correspondence:

That is not accurate. I called you after receiving your revisions to

talk through them as I knew the wholesale deletion of the

confidentiality and non-disparagement clauses were going to be an

issue for our client. After the explanation of your client’s thoughts

on why he wanted these provisions removed, I then, accurately,

predicted it would take some effort to get our client to agree to

remove what is otherwise standard settlement provisions. The only

thing that changed in the interim is that, to our surprise, Judge

Welby ruled on your client’s pending motions. We expected that

you would have notified the Court that the parties are in settlement

discussions, and had in fact reached a settlement, and to hold off

making any rulings.

Our position is that we have a settlement and release agreement.

My client accepted Tsai’s removal of the confidentiality and non-

disparagement provisions. Attached is a clean copy with the only

additional changes fixing nits such using “borrower” in multiple

places. We can either enter this Settlement Agreement, or move to

set aside the Order from Judge Welby and enforce the settlement

and advise the Court that it was excusable neglect that the parties

didn’t advise the Court of the settlement of the parties and pending

revisions to the Agreement. I don’t think either of our clients want

to spend more time and money on this case though.

Please advise if this is in final form for your client and we will

procure signatures.

ECF No. 91-7 at 2.

Relying on the above correspondence, Family Dollar claims the parties orally agreed to

the material terms of the settlement agreement on October 31, 2022, which included the

dismissal of all claims with prejudice and each party to bear its own costs and attorney’s fees.

Although Mr. Layfield acknowledges its client, Family Dollar, had yet to agree to the deletion of

the Confidentiality and Non-Disparaging provisions, he argues they were minor, nonmaterial

provisions, irrelevant to the question of whether the parties entered into an enforceable

settlement agreement on October 31st. Due to the parties’ dispute regarding whether a settlement

agreement was formed, Family Dollar requested an evidentiary hearing on the issue. See ECF

No. 91 at 5.

Tsai filed oppositions to each of Family Dollar’s post-judgment motions. ECF Nos. 92,

101. Tsai maintains no settlement agreement had been executed. On the date the Court issued its

dismissal order, Tsai asserts the parties were still actively negotiating the material and essential

terms of the proposed settlement, which included its request for the removal of the

Confidentiality and Non-Disparagement provisions. Tsai argues Family Dollar is downplaying

the significance of the two provisions that had yet to be agreed upon prior to the Court’s

dismissal of this action.

Tsai cites to the plain language of the ‘Confidentiality’ provision of the draft ‘Settlement

Agreement and Mutual Release,’ which explicitly states: “This paragraph is a material part of

this Agreement.” See ECF No. 92-1 at 17. Tsai asserts it presented a counteroffer to Family

Dollar on October 28, 2022, when it sent a redline version of the draft settlement agreement

seeking to remove the two provisions and, by Family Dollar’s own admission, the

Confidentiality and Non-Disparaging provisions remained unresolved during the October 31,

2022 phone call. See ECF No. 91 at 5-6. Therefore, Tsai contends it was permissible to withdraw

its counteroffer nineteen days later as it did not receive any confirmation from Family Dollar on

whether the redline, including the deletion of the two provisions, was agreeable.

Evidentiary Hearing

On February 14, 2023, the Court granted Family Dollar’s request for an evidentiary

hearing to determine whether the parties reached an enforceable settlement agreement. ECF No.

106. The evidentiary hearing was held on February 28, 2023, and each party was allotted time to

present their respective positions to the Court. ECF No. 110. Family Dollar entered 12 exhibits

into the record (labeled Exhibits 1 through 12), and Tsai entered 15 exhibits into the record

(labeled Exhibits D-1 to D-15). ECF No. 108.

Mr. Layfield began the hearing by summarizing the same timeline he offered in his

briefings. As to the October 31st phone call, Mr. Layfield acknowledged that Mr. Keady

expressed issue with the proposed Confidentiality and Non-Disparaging clauses and explained

“Tsai was worried that what Family Dollar hadn’t recovered in this suit they would then

somehow turn around and recover from [] Tsai in the form of a breach of the confidentiality

agreement or the non-disparagement clause.” ECF No. 110 at 8. Mr. Layfield indicated he told

Mr. Keady he did not think the removal of the provisions would be a problem, but it would take

him “a little bit of time to get [Family Dollar] to sign off . . . because it’s abnormal for them.” Id.

at 8-9. See also id. at 15. Despite having to follow up with his client, Mr. Layfield represented

his belief the October 31st phone call resulted in “a settlement with all material terms.” Id. at 11.

To further support his position that a settlement had been reached, Mr. Layfield pointed

to email correspondence, dated November 5, 2022, between himself and Mr. Keady. Mr. Keady

wrote to Mr. Layfield:

I believe our discovery responses are due Monday. Will you consent to an

additional ten (10) days to respond?

Our client would prefer not to incur additional fees while we explore settlement.

See Pl.’s Ex. 9; Def.’s Ex. D-8. In response, Mr. Layfield wrote:

Yes. We will consent to that 10 day extension. I will follow up with our client on

Monday concerning the revisions to the Agreement too.

Id. Mr. Layfield argued Mr. Keady’s extension request was for the purpose of “try[ing] to get

this thing wrapped up. . . . Because [they] both believed that [they] had a settlement[.]” ECF No.

110 at 11.

In response to specific questions asked by the Court, Mr. Layfield represented it was not

until November 11, 2022, two days after the Court dismissed this action, that Family Dollar

reviewed the removal of the provisions and agreed they were not material. See ECF No. 110

at 17 (“it took me until [] November 11th to get my client to review the removal of them and

understand [] that they weren’t material”). Mr. Layfield additionally confirmed he did not tell

Mr. Keady until November 23, 2022, that Family Dollar accepted the requested deletions. See id.

at 18, 38.

Mr. Keady maintained he did not enter into a final and enforceable settlement agreement

on behalf of Tsai. Mr. Keady first points to an October 12, 2022 letter from Mr. Layfield. ECF

No. 110 at 20-21 (citing Def.’s Ex D-2). The letter evidences the start of settlement discussions,

and advises Tsai that Family Dollar “expressly reserves all rights, claims, and remedies and does

not waive any defenses . . . unless and until the Settlement Agreement is reduced to writing and

signed by the parties.” Def.’s Ex D-2 (emphasis added). Mr. Keady stressed that no agreement

had ever been signed by the parties as explicitly required by Family Dollar. Mr. Keady pointed to

the original proposed settlement agreement, which explicitly indicated the ‘Confidentiality’

provision to be “a material part of the Agreement.” ECF No. 110 at 22 (citing Def.’s Ex D-5; see

also ECF No. 92-1 at 16-17). Mr. Keady further cited to the redline version he sent back to Mr.

Layfield, which included wholesale deletions of both the Confidentiality and Non-Disparaging

clauses. Id. at 23 (citing Def.’s Ex D-7; see also ECF No. 92-1 at 37-38). Mr. Keady confirmed

he spoke to Mr. Layfield on October 31, 2022, about the proposed deletions and explained why

the two provisions were important and material to Tsai. Id. at 23-25. Mr. Keady indicated he did

not consider the matter settled at the conclusion of the October 31st phone call because Mr.

Layfield expressed that it might be “difficult to convince Family Dollar to have these provisions

removed . . . , but that he would confer with his client[.]” Id. at 25.

As to the November 5, 2022 e-mail correspondence quoted above, Mr. Keady argued his

“while we explore settlement” language was intentional and evidenced a formal agreement had

yet to be created. Id. Moreover, Mr. Keady pointed to Mr. Layfield’s same-day response stating

he would follow up with Family Dollar concerning Tsai’s proposed revisions. Mr. Keady

maintained there was no agreement at that point because Mr. Layfield still needed to seek

approval from his client. Mr. Keady further contended that the very fact he filed a consent

motion on November 7, 2022 for extension of time to answer, object or otherwise respond to

Family Dollar’s discovery, ECF No. 82, corroborated that no formal settlement had occurred

between the parties. ECF No. 110 at 26. Mr. Keady argued that if the parties had reached a

settlement, the proper response from Mr. Layfield should have been, “[W]hat do you mean? You

don’t need ten additional days for discovery. We’re settled.” Id. Mr. Keady indicated, on

November 9, 2022, Tsai was “still waiting to hear from Family Dollar as to whether or not they

would agree to the removal of [the Confidentiality and Non-Disparaging] provisions.” Id. at 30.

Mr. Keady asserted that the behavior of the parties showed active negotiations, and nothing

more.

Discussion

As a preliminary matter, the Court first notes that although Family Dollar argues it

entered into an oral settlement agreement with Tsai on October 31, 2022, neither party filed a

stipulation for dismissal or formal notice that the matter was settled. Without such notification,

nine days after the alleged settlement, the Court granted Tsai’s motion for judgment on the

pleadings and motion to dismiss for failure to state a claim. From the exhibits submitted by the

parties with their briefings and at the evidentiary hearing, it appears settlement negotiations

began on October 12, 2022. However, neither Family Dollar nor Tsai filed a motion requesting

the Court to stay this action during such discussions. Family Dollar oddly chastises Tsai in its

November 23, 2022 email for not notifying the Court that the parties were “in settlement

discussions, and had in fact reached a settlement, and to hold off making any rulings.” See ECF

No. 91-7 at 2. However, Family Dollar was able to observe that Tsai had not filed any such

notice, and was acutely aware two dispositive motions were pending as it had filed oppositions to

both. Family Dollar had ample time to notify the Court that this matter should have been stayed

pending settlement discussions. Additionally, if Family Dollar understood a settlement had been

formally reached on October 31, 2022, it is surprising that a stipulation for dismissal or notice of

settlement would not have been filed.

A federal diversity court applies the forum state’s law of contract interpretation to

determine whether a settlement agreement was formed. State Auto Prop. & Cas. Ins. Co. v.

Boardwalk Apts., L.C., 572 F.3d 511, 514 (8th Cir. 2009); Barry v. Barry, 172 F.3d 1011, 1013

(8th Cir. 1999). “Under Missouri law, the essential elements of a valid settlement agreement are

the involvement of parties who are competent to contract, a proper subject matter, legal

consideration, mutuality of obligation, and mutuality of agreement.” Ross Dress for Less, Inc. v.

St. Louis Retail Outlet, LLC, 2020 WL 1693680, at *7 (E.D. Mo. Apr. 7, 2020) (citing Chaganti

& Assocs., P.C. v. Nowotny, 470 F.3d 1215, 1221 (8th Cir. 2006)). “Negotiations or preliminary

steps towards a contract do not constitute a contract.” J.H. v. Brown, 331 S.W.3d 692, 701-02

(Mo. Ct. App. 2011). Rather, “[t]he creation of a valid settlement agreement requires a meeting

of the minds and a mutual assent to the essential terms of the agreement.” Ross Dress for Less,

Inc., 2020 WL 1693680, at *7 (quoting St. Louis Union Station Holdings, Inc. v. Discovery

Channel Store, Inc., 301 S.W.3d 549, 552 (Mo. Ct. App. 2009)). “A mutual agreement is reached

when ‘the minds of the contracting parties [ ] meet upon and assent to the same thing in the same

sense at the same time.’” Grant v. Sears, 379 S.W.3d 905, 916 (Mo. Ct. App. 2012) (quoting

Kunzie v. Jack-in-the-Box, Inc., 330 S.W.3d 476, 483 (Mo. Ct. App. 2010)). “In determining

whether a meeting of minds has occurred, the court looks at the objective manifestations of the

parties.” Brooks v. Standard Fire Ins. Co., 2014 WL 7157357, at *1 (E.D. Mo. Dec. 15, 2014)

(citing Missouri cases).

The party requesting enforcement of a settlement agreement has the burden of proving

the existence of the agreement by “clear, convincing, and satisfactory evidence.” Matthes v.

Wynkoop, 435 S.W.3d 100, 106 (Mo. Ct. App. 2014) (quoting Paragon Lawns, Inc. v. Barefoot,

Inc., 304 S.W.3d 298, 300 (Mo. Ct. App. 2010)); see also Kenner v. City of Richmond Heights,

Mo., 356 F. Supp. 2d 1002, 1008 (E.D. Mo. 2005). “Evidence is clear and convincing if it

instantly tilt[s] the scales in the affirmative when weighed against the evidence in opposition,

[such that] the fact finder’s mind is left with an abiding conviction that the evidence is true.”

Matthes, 435 S.W.3d at 106 (quoting Grant, 379 S.W.3d at 915).

The Court agrees with Tsai that the parties did not reach a settlement agreement as to all

material terms. As evidenced from the email correspondence submitted to the Court and

summarized above, on October 27, 2022, Family Dollar’s attorney emailed a “proposed

Settlement and Release” with a disclaimer that the proposal was still “subject to [Family

Dollar’s] review and comment[.]” ECF No. 91-4. On October 28, 2022, Tsai’s attorney returned

a redlined second draft, which, in part, deleted the Confidentiality and Non-Disparaging clauses

from Family Dollar’s proposal. ECF Nos. 92-1 at 22, 37-38; 91-5 at 2. One of the two provisions

sought to be removed by Tsai was explicitly identified by Family Dollar as a material clause.

The proposed settlement agreement that Mr. Layfield originally sent to Mr. Keady included the

following language:

7.0 Confidentiality. The Borrowers expressly understand and agree that this

Agreement, the terms of this Agreement, and the allegations which compromise

the Case, shall be treated as confidential and shall not be disclosed or released to

any third party whatsoever, including, but not limited to, a prohibition on

Borrowers posting or otherwise disclosing Information on the Internet or any

other paper or electronic media outlet (including but not limited to news

organization websites or newspapers, email, blogs, Facebook, Twitter, social

media and all similar forms of disclosure); and not to transfer an original or any

copy of this Agreement to any other person or entity. Borrowers may disclose the

terms, contents, substance of and copy of this Agreement to the Borrowers’

counsel, accountants, financial advisors, tax professionals retained by them, any

federal, state, or local governmental taxing or regulatory authority, and except as

required by law or order of court or to enforce this Agreement. This paragraph is

a material part of this Agreement.

ECF No. 92-1 at 16-17 (emphasis added).

Family Dollar now attempts to argue that the Confidentiality provision was not material,

despite designating it as such in its own proposed agreement. The Court will not permit Family

Dollar to change what it had already defined as material to the agreement. Moreover, Tsai

conveyed to Family Dollar on October 28 and 31 that the exclusion of the Confidentiality and

Non-Disparaging clauses was material for Tsai. Notably, Mr. Layfield represented during the

evidentiary hearing that the Confidentiality clause was material to Family Dollar when it was

included in the first draft, but then it “was no longer a material matter for [Family Dollar]” after

Mr. Keady explained it was a material matter for Tsai. See ECF No. 110 at 16. In an Affidavit,

Mr. Keady attested he told Mr. Layfield that the deletion of the two provisions was “necessary

and essential” because inclusion would “ostensibly permit Family Dollar to sue Tsai for a

purported breach in the future.” ECF No. 92-1 at 3-4.

The attorneys for both parties agree that they spoke on the phone on October 31, 2022.

During that phone call, Family Dollar had not yet agreed to the removal of the Confidentiality

and Non-Disparaging clauses because Mr. Layfield needed formal approval from his client. As

Family Dollar states in its memorandum of support, “The only remaining issues were the

confidentiality and non-disparagement terms[.]” ECF No. 91 at 6. Moreover, there is no evidence

in the record showing Mr. Layfield told Mr. Keady at any time on or before October 31st that the

original proposal, which was marked as subject to Family Dollar’s review and comment, was

actually reviewed and approved by Family Dollar.

On November 9, 2022, the Court granted Tsai’s pending dispositive motions and

dismissed this case. Ten days later, on November 19, 2022, Tsai’s attorney withdrew its redlined

counteroffer:

Matt:

We never received a response to our suggestions contained in the email below

[referring to Tsai’s proposed redline]. To whatever extent they were interpreted as

a counter offer, they are hereby withdrawn; and, to be clear, any and all proposals

from you[r] client have already been rejected.

Vince

ECF Nos. 91-6 at 2; 92-1 at 51.

Mr. Layfield responded to Tsai’s withdrawal via email on November 23, 2022. ECF No.

91-7 at 2. Within his email, Mr. Layfield indicated that at the time of the October 31, 2022 phone

call, the removal of the two provisions had not yet been approved by Family Dollar. Id. (“After

the explanation of your client’s thoughts on why he wanted these provisions removed, I then,

accurately, predicted it would take some effort to get our client to agree to remove what is

otherwise standard settlement provisions.”). At the evidentiary hearing, Mr. Layfield admitted

that Family Dollar did not review and approve of Tsai’s redlines until November 11th, and

November 23rd was the first time he conveyed to Mr. Keady that the deletions would be

acceptable to Family Dollar. ECF No. 110 at 17-18, 38. Thus, the Court finds that, despite

Family Dollar’s arguments, no settlement agreement had been reached on October 31, 2023,

because Family Dollar had yet to agree to the removal of two provisions, one of which Family

Dollar described as “material” within its very own draft agreement. Mr. Keady expressed to Mr.

Layfield that the removal of the Confidentiality and Non-Disparaging clauses was material to

Tsai. Here, Tsai repeatedly made it clear through its redline, and in subsequent correspondence,

that it would not agree to a settlement without the removal of the Confidentiality and Non-

Disparaging provisions.

Tsai cites to Nuesse v. TomTom, Inc., 2013 WL 3157790 (E.D. Mo. June 20, 2013),

which is instructive to the issues before this Court. In Nuesse, plaintiff brought a motion to

enforce a settlement agreement that defendant drafted. After receiving the agreement, plaintiff

removed the confidentiality clause and sent back a signed agreement. After not receiving

payment as required by the agreement, plaintiff sought to enforce the terms. In determining a

settlement agreement was not formed between the parties, this Court explained:

[A] valid settlement agreement requires a mutuality of agreement, i.e. a “meeting of the

minds.” Chaganti & Associates, P.C. v. Nowotny, 470 F.3d 1215, 1221 (8th Cir. 2006). A

court should determine whether such a meeting of the minds took place by “looking to

the intentions of the parties as expressed or manifested in their words or acts.” Id. An

enforceable settlement requires the parties to reach agreement on the material terms of

the deal; however agreements that do not expressly resolve ancillary issues may still be

enforceable. Sheng v. Starkey Labs., 117 F.3d 1081, 1083 (8th Cir. 1997); see also

Chaganti, 470 F.3d at 1221.

No enforceable settlement agreement exists between the parties. Although

the parties reached an agreement to the monetary value of the settlement, the

contract hinged on other material terms not yet agreed to. See Jackson v. Fed.

Reserve Emp. Benefit Sys., 2009 WL 2982924 (D. Minn. 2009); see also

Sheng, 117 F.3d at 1083; Goddard v. Henry’s Food, Inc., 291 F. Supp. 2d 1021,

1028 [D. Minn. Sept. 26, 2003] (holding that whether a particular term is material

is a legal determination for the court). The confidentiality clause is a material term

that was not resolved. Although confidentiality clauses are not per se material, the

parties’ arguments reveal that parties considered confidentiality material to the

agreement.

It is evident that both parties had different understandings regarding

whether confidentiality and non-disparagement clauses were included in the

“standard terms” of a settlement agreement. Because both parties were under

conflicting assumptions as to this material term, there was no “meeting of the

minds” sufficient to create a contract on April 16, 2013. Therefore, the proposed

settlement agreement sent by defendant to plaintiff on May 8, 2013, constituted an

offer. When plaintiff made changes to the agreement and returned it to defendant,

a counter-offer was made, which was not accepted. Because there was no

settlement agreement reached by the parties, attorney’s fees and sanctions for

publically disclosing the settlement amount are not applicable.

Id. at *2 (emphasis added).

Similar to Nuesse, Family Dollar designated the Confidentiality clause as a “material part

of this Agreement.” ECF No. 92-1 at 16-17. In response, Tsai was willing to accept a settlement

agreement only if the Confidentiality and Non-Disparaging clauses were removed from the

settlement agreement. After receiving the proposed settlement agreement from Family Dollar –

an agreement which was explicitly noted to still be subject to Family Dollar’s own review and

comment – Tsai sent back redline edits which fully removed both of these clauses. ECF No. 92-1

at 37-38. On October 31, 2022, the parties spoke on the telephone, and Family Dollar told Tsai,

by its own admission in a subsequent email, that removal of these clauses was “going to be an

issue,” and he “predicted it would take some effort to get [Family Dollar] to agree to remove

what is otherwise standard settlement provisions.” See ECF No. 91-7 at 2. At the evidentiary

hearing, Mr. Layfield confirmed his need to follow up with his client, but indicated he told Mr.

Keady that “ultimately it would not be an issue for [Family Dollar] to remove [the provisions].”

ECF No. 110 at 10.

The Court finds Mr. Layfield’s prediction that Family Dollar would ultimately agree to

the changes in the proposed agreement was neither acceptance, nor a mutuality of agreement, nor

a “meeting of the minds.” See Chaganti, 470 F.3d at 1221; see also Muldrow v. City of St. Louis,

2020 WL 3447733, at *3 (E.D. Mo. June 24, 2020) (“Plaintiff’s counsel’s statement that they

‘should be able to reach an agreement’ at some time in the future after Plaintiff could review the

draft language convinces the Court there was no mutual assent to the non-disparagement clause

prior to the time the offer was rescinded.”). Moreover, the fact that removal of these clauses

could be an “issue” to Family Dollar, evidences their importance.

The Confidentiality provision was designated in the contract as a material provision. This

was Family Dollar’s own designation. The exclusion of the Confidentiality and Non-Disparaging

clauses was material to Tsai. Family Dollar admits that during an October 31, 2022 phone call,

Mr. Keady explained why Tsai wanted the two provisions removed, and Mr. Layfield indicated

he would discuss this with Family Dollar. See ECF No. 91-7 at 2. However, it was not until

November 23rd, four days after Tsai informed Family Dollar it was revoking its redlined

counteroffer and rejecting all of Family Dollar’s settlement proposals, that Family Dollar

confirmed its acceptance of the deletions of these material provisions. See id. at 2-3.

The objective manifestations of the parties, as demonstrated by their words and actions,

are also significant to the Court. Neither party notified the Court that the parties had reached a

settlement, even though a motion for judgment on the pleadings and a motion to dismiss were

pending. The exhibits of the parties show that on November 5, 2022, Mr. Keady sent an email to

Mr. Layfield asking for a 10-day discovery extension while the parties “explore settlement.”

Def.’s Ex. D-8. Mr. Layfield agreed to the extension on November 5, and indicated he would

follow up with Family Dollar “on Monday concerning the revisions to the Agreement,” and he

did not question Mr. Keady’s use of the phrase “explore settlement.” Id. The Court finds Family

Dollar’s argument that it believed an enforceable settlement agreement was formed during

counsels’ telephone conversation on October 31st is inconsistent with its words and actions of

consenting to a discovery extension, promising to follow up with the client on Monday, and not

informing the Court that a settlement or tentative settlement had been reached.

Following the rationale in Nuesse and Chaganti, this Court does not find that a “meeting

of the minds” occurred during the October 31st phone call. The Court finds the parties had made

significant steps towards reaching a settlement agreement; however, the parties had not agreed

on the inclusion or exclusion of the Confidentiality and Non-Disparaging clauses prior to Tsai’s

revocation of its counteroffer. The two provisions were material to both of the parties. However,

Family Dollar did not notify Tsai of its agreement to remove these clauses until four days after

Tsai rescinded its counteroffer and rejected all of Family Dollar settlement offers.

After careful review of the parties’ arguments, emails, affidavits, and actions, the Court

determines Plaintiff has failed to establish by clear, convincing, and satisfactory evidence that a

settlement agreement was formed. As such, Family Dollar’s Motion to Alter or Amend this

Court’s dismissal and Motion to Enforce the Settlement agreement will be denied.

Accordingly,

IT IS HEREBY ORDERED that Plaintiff Family Dollar Stores of Missouri, LLC’s

Motion to Alter or Amend Judgment [ECF No. 90] is DENIED.

IT IS FURTHER ORDERED that Plaintiff Family Dollar Stores of Missouri, LLC’s

Motion to Enforce Settlement Agreement [ECF No. 93] is DENIED.

So Ordered this 21st day of March, 2023.

UNITED STATES MAGISTRATE JUDGE

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