(3) there is no “insurmountable lag” between liquidated and actual damage. On the other hand, reputational damage is more difficult to measure. It will not be difficult for Dennison to argue that the damage caused by Peterson, which reveals information about the alleged case, is “unable or difficult to estimate.” The proposed contract not only allows Dennison to decide whether to recover real or liquidated damages, but also expressly gives him the right to obtain an injunction or injunction to prevent the imminent disclosure of confidential information, i.e. a “gag order”. The Virginia Supreme Court ruled and the Eastern District of Virginia recently confirmed that the parties “may agree in advance on the remedy resulting from an offence, including damages, but only if (i) the actual damages contemplated at the time of the agreement are uncertain and difficult to determine accurately and (ii) the amount set is not disproportionate to the probable damage.” Job v. Simply Wireless, Inc., 2015 U.S. Dist. LEXIS 171535, `11 (E.D. Va. December 22, 2015). A breach of confidentiality would be a good example if the actual damages are unknown, since the facts surrounding the offence are unknown even at the time of trial and execution of the release.
The biggest question a restaurant or retail business must consider is whether or not the amount of damage is proportionate to the likely damage. For example, at Nacogdoches Heart Clinic, P.A. v. Pokala (known as “Nak-uh-doach-us”), a doctor agreed to pay $100,000 per month in liquidated damages per month for each month in which he violated the non-competition obligation. This amount was based on his salary during work for the clinic, not on the actual loss that the clinic expected to suffer when he went. The clause was therefore not applicable because it was not a reasonable forecast of fair compensation. Nacogdoches Heart Clinic, P.A. v.
Pokala No. 12-11-00133-CV, 2013 WL 451810, at 7 (Tex. App.-Tyler Feb. 6, 2013, fart. denied) (mem. op.) (referring to Phillips v. Phillips). Another question is who is “bound” by a confidentiality clause.
Transaction agreements are usually signed only by the parties to the dispute. However, if the agreement defines a “party” that includes agents and representatives, this could be read to create binding obligations for the party`s lawyers. Therefore, even if he is not directly involved in the transaction agreement, a lawyer may, in addition to the general obligation of the lawyer to maintain the trust of the clients according to the rules of ethics, be bound by the rules of confidentiality as the agent of the client. The transaction contract in the Smelkinson Sysco/. Harrell, 162 Md.App. 437 (2005) provides a model for an enforceable determination of damages. In this case, a former employee agreed not to denigrate his former employer and to help non-salary third parties pursue the lawsuit against the company. It is important that, in the event of a breach of the provision, he has been authorized to recover damages related to the breach, including, but not limited to the amount he received when paying his claims. He also agreed that these non-exclusive prejudices “are not a sanction, but are fair and appropriate given the difficulty of proving bias to his former employer in the event of an infringement.” There are strong political considerations that favour the implementation of transaction agreements. See, Hallock v. State of New York, 64 N.Y.2d 224 (N.Y. 1984).
A negotiated compromise avoids potentially costly and tedious litigation and preserves limited judicial resources. The courts would not be able to function if each dispute is transferred to legal action. Denburg v. Parker Chapin Flattau – Klimpl, 82 N.Y.2d 375 (N.Y. 1993). For example, to justify sufficient consideration, a party only has to have good faith in the merits of its position.