In the case of Steele v. Leduc (City), 2025 ABKB 205, the Alberta Court of King's Bench granted an order permitting the public disclosure of certain details of a settlement agreement (the Agreement) in a class-action lawsuit by numerous current and former female employees of the City of Leduc, which alleged gender discrimination, sexual harassment, sexual misconduct, and sexual assault (collectively, the Sexual Misconduct).
Specifically, the court granted an order permitting the Plaintiffs to disclose the following information to the public:
- the total number of women who have made claims and had claims approved as part of the Agreement; and
- the total amount paid to women who have made claims and had claims approved as part of the Agreement.
(the Information)
While the underlying dispute is a matter of obvious public interest, the Court made its decision primarily on the basis of the written terms of the Agreement. As such, this case highlights the importance of careful contractual drafting. Should the parties wish to prohibit disclosure of information relating to a settlement to third parties, they should make sure that the contract clearly reflects their wishes.
Facts
The underlying class action in this case (the Class Action) was brought on behalf of current and former women employees who worked for the Defendant between 2002 and the date of certification, and who alleged that they were subject to sexual misconduct. The Plaintiffs in this matter were the representative Plaintiffs in the Class Action.
The Agreement was modeled on the agreement approved in Heyder v. Canada (Attorney General), 2019 FC 1477 (the Heyder Agreement), a class action relating to allegations of sexual misconduct in the Canadian Armed Forces and Department of National Defence.
On July 4, 2023, the Class Action was certified, and the Agreement approved by the Court.
In March of 2024, the Plaintiffs had brought an application seeking to disclose the number of women who had submitted claims and had claims approved under the Agreement. At that time, the Court only allowed them to disclose that a significant number of claims had been received and approved (the March 2024 Order). The Court refused further disclosure at that time, being concerned there was a risk more fulsome disclosure could reveal the identity of individual claimants, due to the limited number of women who had at that point made claims.
The Court permitted the plaintiffs to re-attend at a later date if the circumstances changed. The Plaintiffs were allowed to return, and that is the case being summarized here. They were allowed to return to seek permission to disclose more information publicly because:
- the claim period was now concluded; and
- all of the claimants under the Agreement had consented to the disclosure of the total number of women who had successfully made claims.
Analysis / Conclusion
Some issues to be determined in this case were as follows:
- Is the Information captured by the confidentiality provisions in the Agreement?
- Is the Information subject to settlement privilege or an implied undertaking of confidentiality and thereby protected from public disclosure?
- Should the information have been disclosed for public policy reasons?
Is the Information Captured by the Confidentiality Provisions in the Agreement?
The relevant confidentiality provisions of the Agreement (the Confidentiality Provisions) read as follows:
- Confidentiality
52.1 Any information provided, created or obtained in the course of this settlement, whether written or oral, will be kept confidential by the Parties, the Parties' counsel, the Administrator and the Assessor and will not be shared or used for any purpose other than this Settlement Agreement unless otherwise agreed by the Parties or as otherwise provided for or required by law or as may be relevant to other proceedings involving Leduc and a Class Member. Information may be provided to Leduc's City Manager, as necessary to address other proceedings involving Leduc and a Class Member.
52.2 The information and documents provided by Class Members, or the fact that a Class member has claimed under this Settlement Agreement, may be disclosed to counsel for the Parties, but will not be disclosed to Class Members' co-workers, supervisors or Leduc leadership, except with the consent of the Class Member or as required by law or as may be relevant to other proceedings involving Leduc as a Class Member. Information may be provided to Leduc's City Manager, as necessary to address other proceedings involving Leduc and a Class Member.
The Plaintiffs argued that the Information did not explicitly fall under the scope of the Confidentiality Provisions, but even if it did, all the claimants had consented to the disclosure under 52.2.
The Defendant argued that the Information fell under the scope of the Confidentiality Provisions, as:
- the "overall tenor" of the Agreement is to keep all claims confidential, unless agreed to by both parties. As the Defendant had not agreed to such disclosure, it ought to be prohibited;
- clause 52.1, and specifically the language "[a]ny information provided, created, or obtained in the course of the settlement" was sufficient to capture the Information, as it was information created in the course of the settlement. Specifically, the Defendant argued that: (i) clause 52.1 covers more than just the personally identifiable information of the claimants, but also covers the Defendant's interests by limiting public disclosure of information about the settlement; and (ii) in any event, disclosing the Information risks identifying individual complainants, due to the small size of the Defendant's workforce;
- although the Agreement was modeled after the Heyder Agreement, that agreement provided for a public reporting mechanism requiring the disclosure of the number of claimants and total amount of compensation paid; and
- the circumstances in the other class action settlements identified by the Plaintiffs are not analogous, as in those cases, the parties had mutually agreed to disclosure, either expressly or by necessary implication.
While the Court agreed with the Defendant that the Heyder Agreement and the other class actions the Plaintiffs cited were of limited relevance in interpreting the confidentiality provisions of the Agreement, it ultimately found that the language of the Agreement made it clear that disclosure of the Information was not prohibited:
[30] The Defendant's interpretation of clause 52.1 as prohibiting disclosure of the Information is in tension with the fact that the Agreement does not prohibit individual claimants from disclosing information to the public.
[31] Had the parties intended that information about the number of claimants or the total amount of compensation paid would remain confidential, as a part of a broader purpose of limiting the information disclosed to the public about the settlement, they presumably would have included a provision in the Agreement that would prohibit individual claimants from disclosing that they made a claim, and the amount of compensation received.
[32] Yet the parties did not do so. The confidentiality obligations in clause 52.1 only bind "the Parties, the Parties' counsel, the Administrator and the Assessor." As discussed above, the term "Parties" does not include the claimants, meaning that clause 52.1 would not prohibit an individual claimant from disclosing that they had made a claim, or the amount received. Nor is there any other provision in the Agreement that has this effect. [emphasis added]
[33] [...] Notwithstanding that clause 52.1 only refers to the "Parties," the Defendant says that interpreting clause 52.1 as not applying to individual claimants would lead to an "absurd result" that the representative plaintiffs are bound by clause 52.1 in their capacity as representative plaintiffs but not in their capacity as claimants.
[34] I disagree. The language in clause 52.1 is clear. The Agreement provides for defined terms that would include the claimants (i.e., "Claimants" and "Class Members") but does not use these terms in clause 52.1. To accept the Defendant's interpretation would require that I rewrite clause 52.1 in the face of clear language indicating that the parties did not intend that individual claimants would be bound by the provision.
[35] The Defendant's interpretation of clause 52.1 as prohibiting disclosure of the Information is also in tension with other provisions of the Agreement that expressly provide for public disclosure of information about the settlement, namely, clauses 9.1 and 10.1, which provide for a public apology by the Mayor, and for a joint statement by the City of Leduc and the representative plaintiffs upon reaching the settlement. While neither of these provisions requires disclosure of the Information that the Plaintiffs seek to disclose, the existence of these provisions is in tension with the Defendant's suggestion that one of the parties' objectives under the Agreement was to limit public disclosure of information about the settlement, even if disclosure of that information would not undermine the confidentiality of the claims process.
Is the Information Subject to Settlement Privilege or an Implied Undertaking of Confidentiality?
The Plaintiffs argued that none of the elements of the legal test for settlement privilege were made out in this case, and in any event, a class action settlement is not analogous to an ordinary settlement, as there is no reasonable expectation of privacy in the terms of a class action settlement, or in information about the number of claimants and amounts paid.
The Defendants argued that the Information is protected by settlement privilege, and that there is no principled difference between a class action settlement and an ordinary settlement.
In rejecting the Defendant's arguments, the court found that settlement privilege is a rule of evidence, and as such, does not prevent a party from disclosing information. While agreeing with the Defendant that settlement privilege extends to the existence of and terms of a settlement, the Court found that the Defendant had not provided any authority for the proposition that an implied undertaking of confidentiality extends to the existence of a settlement or the terms of same.
Accordingly, the Court found that disclosure of the Information is neither precluded by settlement privilege nor the implied undertaking of confidentiality.
Should the Information be Disclosed to the Public for Public Policy Reasons?
The Plaintiffs advanced five arguments in support of their proposition that public policy favored the disclosure of the Information:
- one of the incentives of the class action regime is to incentivize wrongdoers to modify their behaviour, and the disclosure of the Information would further this objective;
- disclosing the Information is necessary to inform the public about the full extent of the problems at the City and to allow the public to hold City officials democratically accountable;
- disclosing the Information would incentivize other organizations to address sexual misconduct in the workplace;
- disclosing the Information would show individual claimants that they are not alone and help them feel less isolated; and
- the release of the Information is necessary to inform women who may be considering working for the City.
The Defendant argued that public policy did not favour disclosure, as:
- the concerns above are adequately addressed by information that had already been made public;
- the release of the Information might cause controversy among ratepayers; and
- the release of the Information could generate backlash against women suspected of making claims.
The Court rejected the Plaintiffs' arguments, finding that they were effectively asking that the Court recognize a novel principle of contractual interpretation – that when faced with ambiguity in a class action settlement, the Court should favour an interpretation consistent with the public policy objectives underlying the class action regime:
[58] The Plaintiffs are effectively asking that I recognize a novel principle of contractual interpretation for class action settlements, i.e., that when faced with an ambiguity in a class action settlement agreement, the court should favour an interpretation that is consistent with the public policy objectives underlying the class action regime.
[59] I acknowledge that workplace sexual misconduct is a matter of significant concern in our society. I also acknowledge that these concerns are magnified when dealing with a government entity whose leadership must be accountable to the public. However, I am not prepared to recognize a novel principle of contractual interpretation whereby these considerations would play a role in the interpretation of the Agreement.
My Take
I was initially surprised when hearing of the outcome in this case, as it is very rare that a court will permit the disclosure of the terms of settlement agreements.
However, upon reviewing the Court's reasoning and particularly, its analysis of the terms of the Agreement, it makes sense that disclosure was permitted in this case.
This outcome emphasizes the critical importance of proper contractual drafting. Notably, despite the significant public policy implications of this dispute, the Court roundly rejected the Plaintiffs' arguments that public policy favoured disclosure, as well as its analogies to similar class actions.
Instead, the Court focused on the language of the Agreement itself in finding that disclosure of the Information should be allowed. Had the Agreement been drafted to prohibit disclosure by individual claimants of their claims and the amounts received, it is likely the Court would have sided with the Defendants.
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