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HomeMy WebLinkAboutResolution - 2012-R0231 - Settlement Agreement And Release - Martha Ellerbrook - 06_07_2012Resolution No. 2012--RO231 June 7, 2012 Item No. 6.1 RESOLUTION I E IT RESOLVED by the City Council of the City of Lubbock, Texas: THAT the Mayor of the City of Lubbock is hereby authorized and directed to execute a (Settlement Agreement and Release between the City of Lubbock, Texas and Martha Ellerbrook in connection with Martha Ellerbrook v. City of Lubbock, No. 11-10058, In The United States Court of Appeals For The Fifth Circuit, Appeal from the United States District Court for the (Northern District of Texas USDC No. 5:09-CV-144, in a form and substance as set forth in Exhibit "A" attached hereto and incorporated herein for all purposes, and related documents. Passed by the City Council this 7th ATTEST: 6j�'-o 0-�p if - -X-) Rebecc Garza, City Seer tart' APPROVED'': Sam Medina, Ctt Attorney Reso.Ellerbrook Settlement Agrmnt 6.1.12 day of .Tttnp 2012. ROBERTSON, MAYOR Resolution No. 2012-RO231 SETTLEMENT AGREEMENT AND RELEASE This Agreement confirms the settlement herein between Plaintiff, Martha Ellerbrook and Defendant, City of Lubbock. Plaintiff and Defendant are sometimes jointly referred to in this Agreement as the "Parties." The Parties agree as follows: Plaintiff has asserted claims against Defendant in a lawsuit styled, Cause No. 5:09-cv- 00144-C; Martha Ellerbrook v City of Lubbock, Texas; In the United States District Court, Northern District of Texas, Lubbock Division (the "Lawsuit") - AGREEMENT: In consideration of the promises and the mutual covenants and agreements set forth herein, the Parties hereby agree as follows: 1.1 Compromise and Agreement to Settle. The Parties hereby agree to settle the Lawsuit for the consideration referenced in this Agreement. It is understood and agreed by the Parties that this Agreement is a compromise of disputed claims. 1.2 Consideration to Plaintiff. In consideration for the releases and other covenants and agreements set forth in this Agreement, as well as the verdict of the jury and Plaintiff's claims for attorneys' fees, costs, and prejudgment and post judgment interest, Defendant agrees to pay Plaintiff and her attorneys the sum of $443,559.28, and properly tender $79,000.89 withheld from her $243,000 back -pay award for income, Medicare and FICA taxes (the "Payment").' Plaintiff acknowledges that the payment specified above is the only consideration that Defendant will ever pay to Plaintiff under this Agreement or in connection with settlement of its claims. In addition to the above -described withholding, which may be modified dependent upon determination of whether the Plaintiff is subject to Texas Municipal Retirement System ("TMRS") contributions in exchange for retirement credit out of the $243,000 back -pay award despite a want of actual service, the Parties agree to escrow $131,440.72 from the settlement to be held in escrow by the City to make those TMRS contributions as well as pending tax obligations. The escrowed amount will be held by the City in an interest bearing account pending a determination of any applicable contributions. The Plaintiff's counsel shall be notified within 30 days as to whether the Plaintiff is subject to TMRS contributions, the amount of TMRS contribution required to be made from the escrow amount on behalf of the Plaintiff, the revised income, Medicare and FICA taxes withheld. Further, any amounts escrowed or taxes withheld that are not required to be tendered to TMRS or the Internal Revenue Service (IRS), shall be promptly (within 5 business days) tendered to Plaintiff's counsel. If no TMRScontribution is 'The $79,000.89 withheld for income, Medicare and FICA taxes is based on $243,000 back -pay award and the Plaintiff being subject to TMRS contributions. If it is determined that the Plaintiff is not subject to TMRS contributions of $52,439.83, the income, Medicare and FICA tax withholding will be revised to $98,270.30 with the remainder of the $131,440.72 held in escrow tendered to the Plaintiff's counsel within 5 business days. required and/or Plaintiff is not credited for corresponding past services, or the City has failed to make the determination as to whether the Plaintiff is subject to TMRS contributions within 30 days, the City will promptly (within 5 business days) tender the escrowed amount to Plaintiff's counsel. 1.3 Logistics of Payment. Within � business days of this agreement, Defendant will either wire transfer the Payment less the escrowed amount to Plaintiff's IOLTA trust account: Lubel Voyles LLP Bank of Texas Account#8093294401 Routing 4111014325, or send check made payable to Martha Ellerbrook c/o Lubel Voyles LLP. Once Plaintiff receives the payment, Plaintiff will file dismissal papers with the Court. Plaintiffs counsel agrees to hold the above -referenced settlement amount in trust, and not distribute any check to Plaintiff until after the case is dismissed. A form of dismissal acceptable to the parties is attached hereto as Exhibit A. 1.4 Release by Plaintiff. As described in more detail below, and subject to receiving the above -described settlement proceeds, Plaintiff hereby releases, acquits, covenants not to sue, and forever discharges Defendant and all subsidiaries and affiliates of Defendant. This Agreement and release also extends to employees, officers, elected officials, agents, attorneys, and assigns of any of the entities named or described in this paragraph; insurer and all other persons, natural or corporate, in privity with Defendant or with any of the other entities named or described in this paragraph. The entities and persons released in this paragraph shall be referred to in this Agreement as the "Defendant Releasees." The claims Plaintiff hereby releases include claims or causes of action of any nature, whether in contract or tort or otherwise, known or unknown, suspected or unsuspected, that have accrued to Plaintiff and arise on or before the date of execution of this Agreement, including but not limited to any claim asserted or that could have been asserted in the Lawsuit. The Parties intend and agree that this release will be as broad in scope as is legally permissible. 1.5. Release by Defendant. Defendant hereby releases, acquits, covenants not to sue, and forever discharges Plaintiff and her spouse and immediate family members. The entities and persons released in this paragraph shall be referred to in this Agreement as the "Plaintiff Releasees," The claims Defendant hereby releases include claims or causes of action of any nature, whether in contract or tort or otherwise, known or unknown, suspected or unsuspected, that have accrued to Defendant and arise on or before the date of execution of this Agreement, including but not limited to any claim asserted or that could have been asserted in the Lawsuit, The Parties intend and agree that this release will be as broad in scope as is legally permissible. 1.6. Indemnification by Plaintiff. To the extent allowed by law, PLAINTIFF AND PLAINTIFF'S HEIRS, EXECUTORS, ADMINISTRATORS, AND ASSIGNS SHALL SETTLEMENT%20AGREEMENTUHAND%20RELEASE%20E1[erbrook%20%206%206%2012`X 20(4)%20(2) 2 INDEMNIFY, DEFEND AND HOLD HARMLESS DEFENDANT RELEASEES FROM ANY AND ALL CLAIMS, DEMANDS, ACTIONS AND CAUSES OF ACTION, OF WHATEVER NATURE OR CHARACTER THAT HAVE BEEN OR MAY HEREAFTER BE ASSERTED BY ANY PERSON, FIRM, CORPORATION, CLAIMING BY, THROUGH, OR UNDER PLAINTIFF AS A RESULT OF CLAIMS ASSERTED OR THAT COULD HAVE BEEN ASSERTED IN THE LAWSUIT. Plaintiff represents and warrants that Plaintiff is the sole owner of the claims released in this Agreement. 1.7. Indemnification by Defendant. To the extent allowed by law, DEFENDANT AND DEFENDANT'S OFFICERS, AGENTS, ADMINISTRATORS, AND ASSIGNS SHALL INDEMNIFY, DEFEND AND HOLD HARMLESS PLAINTIFF RELEASEES FROM ANY AND ALL CLAIMS, DEMANDS, ACTIONS AND CAUSES OF ACTION, OF WHATEVER NATURE OR CHARACTER THAT HAVE BEEN OR MAY HEREAFTER BE ASSERTED BY ANY PERSON, FIRM, CORPORATION, CLAIMING BY, THROUGH, OR UNDER DEFENDANT AS A RESULT OF CLAIMS ASSERTED OR THAT COULD HAVE BEEN ASSERTED IN THE LAWSUIT. Defendant represents and warrants that Defendant is the sole owner of the claims released in this Agreement. 1.8. Authorization. Defendant City of Lubbock is duly authorized and has obtained all necessary approvals to bind the City of Lubbock and enter into this Agreement on the City of Lubbock's behalf with Plaintiff. MISCELLANEOUS: 2.1 Further Assurances. The Parties agree to execute and deliver, or cause to be executed and delivered all such other instruments and will take all reasonable actions as may be necessary to consummate the transactions herein contained to effectuate the provisions and purposes hereof. 2.2 Non -Waiver. The failure in any one or more instances of a party to insist upon performance of any of the terms, covenants or conditions of this Agreement, to exercise any right or privilege conferred in this Agreement, or the waiver by said party of any breach of any of the terms, covenants or conditions of this Agreement, shall not be construed as a subsequent waiver of any such terms, covenants, conditions, rights or privileges, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred. 2.3 Severability. If a court of competent jurisdiction declares that any provision of this Agreement is illegal, invalid or unenforceable, then such provision shall be modified automatically to the extent necessary to make such provision fully enforceable. If such court does not modify any such provision as contemplated herein, but instead declares it to be wholly illegal, invalid or unenforceable, then such provision shall be severed from this Agreement, and such declaration shall in no way affect the legality, validity and enforceability of the other provisions of this Agreement to which such declaration does not relate. In this event, this Agreement shall be construed as if it did not contain the particular provision held to be illegal, invalid or unenforceable, the rights and obligations of the parties hereto shall be construed and enforced accordingly, and this Agreement otherwise shall remain in full force and effect. SETTLEMENT%20AGREEMENT%20AND%20RELEASE%20E11erbrWk%20%206%206%2012%20(4)%20(2) 3 2.4 Integration. tion. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings. 2.5 Allocation of Consideration. Notwithstanding anything else herein to the contrary, based on the verdict and the settlement allocations, the Parties acknowledge and agree that $243,000 of the the consideration to plaintiff set forth in Paragraph 1.2 above is for back pay/lost wages/benefits. The remainder is for attorneys' fees, costs, and prejudgment and post - judgment interest. The Parties agree that the above -referenced allocations are equal to the current fair market value of the claims and the foregoing allocation of the consideration to plaintiff was arrived based on the verdict, filings with the Court, billing records, and arm's length negotiations. The Parties further agree to report consistently, in any income tax return or other financial statement completed or filed by either party, the consideration to Plaintiff consistent with this agreement and in accordance with said allocation. In any proceeding related to the determination of any tax (federal or state of any type), neither party or their agents of either shall contend or represent that such allocation is not a fair and accurate allocation. 2.6 Multiple Counterparts, This Agreement may be executed in one or more counterparts, all of which shall constitute one agreement. 2.7 Entirety of Agreement. This Agreement and its exhibits constitute the entire agreement between the Parties, and no obligations exist between the Parties other than those described herein, 2.8 Choice of Law. The Parties agree that the law of the State of Texas shall be applied to construe any disputes regarding this Agreement, regardless of the application of choice of law principles, and that any lawsuit filed with respect to this Agreement shall be filed in Texas. 2.9 Successors and Assig Ids. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their heirs, executors, administrators, successors, and assigns. 2.10 Notices. Any notice given under this Agreement shall be in writing and shall be (1) delivered by commercial courier with delivery receipt; or (2) sent by certified mail, return receipt requested; and (3) sent by electronic mail, to the addresses set forth below: Notice to Plaintiff: By courier or mail: Martha Ellerbrook c/o Lubel Voyles LLP Attention: Adam Voyles 5020 Montrose Blvd, Suite 800 Houston, Texas 77006 By electronic mail: adam ,lubelvoyles.com SETTLE.MENT%20AGREEMENT%20AND%20RELEASE%20Ellerirewk%20%206%206%2012%20(4)%20(2) 4 Notice to Defendant: By courier or mail: City of Lubbock c/o Craig, Terrill, Hale & Grantham, LLP First Bank Centre 9816 Slide Road, Suite 201 Lubbock, Texas 79424 By electronic mail: bobc ,cthglawfirm.com IN WITNESS WHEREOF, the Parties have duly executed and delivered this Agreement as of 7th .tune 2012. Defendant City of Lubbock. Plaintiff Martha Ellerbrook Auth ri ed Representative Martha Ellerbrook TITLE: Mayor SETTLEMENT%20AGREEMENT%20AND%201ZELEASE%20Ellerbrook%20%206%206%2012%2(X1}%20(2) 5 Resolution No. 2012-RO231 IN THE UNITED STATES DISTRIC COURT NORTHERN DISTRICT OF TEXAS LUBBOCK DIVISION MARTHA ELLERBROOK, § Plaintiff, § VS. § § CITY OF LUBBOCK § Defendant. § Civil Action No. 5:09-cv-00144-C STIPULATION OF DISMISSAL Pursuant to Rule 41 (a)(1)(A)(ii) of the Federal Rules of Civil Procedure, Plaintiff Martha Ellerbrook hereby stipulates to dismissal with prejudice of the captioned cause of action. Respectfully submitted, LUBEL VOYLES LLP By: /s/Adam Q. Voyles Adam Q. Voyles Texas State Bar No.: 24003121 5020 Montrose Blvd, Suite 800 Telephone No.: (713) 284-5200 Facsimile No.: (713) 284-5250 Email: adamAlubelvoyles.com A.L. Dent III Texas State Bar No.: 05759500 Attorney at Law 908 Town & Country Blvd., Suite 200 Houston, TX 77024 Telephone No.: (713) 465-4611 Facsimile No.: (832) 380-2850 Email: ald3(cicomcast. net ATTORNEYS FOR PLAINTIFF, MARTHA ELLERBROOK By: /s/ Robert L. Craig, Jr. Robert L. Craig, Jr. Texas State Bar No.: 04987300 Craig, Terrill, Hale & Grantham, LLP 9816 Slide Road, Suite 201 Lubbock, Texas 79424 Telephone No.: (806) 744-3232 Facsimile No.: (806) 744-2211 ATTORNEYS FOR DEFENDANT, THE CITY OF LUBBOCK