Appellate court throws out appeal of former hospital employee and affirms prior settlement approval

By Nicholas Malfitano | Nov 28, 2016

Thomas Jefferson University Hospital  

PHILADELPHIA – Three appellate court judges have thrown out an appeal pertaining to a settlement in a wrongful termination action involving a former employee of Thomas Jefferson University Hospital.

On Nov. 22, judges Michael A. Chagares, Thomas I. Vanaskie and Cheryl Ann Krause of the U.S. Court of Appeals for the Third Circuit decided in a per curiam ruling that plaintiff Frank Forba’s appeal in reference to a settlement in his wrongful termination suit against Thomas Jefferson University Hospital was dismissed.

Forba was employed by Jefferson from 2001 until 2012. During that time, he took several periods of leave under the Family Medical Leave Act (FMLA) for both depression and anxiety. Jefferson terminated Forba in 2012, on the grounds he violated Jefferson’s attendance policy.

Forba, through counsel, later filed suit alleging that Jefferson actually terminated him in retaliation for taking FMLA leave. Jefferson filed a motion for summary judgment raising several arguments. Among them was an argument that Forba’s suit was untimely under the FMLA’s two-year statute of limitations because Jefferson terminated his employment on May 4, 2012, but he did not file suit until April 2, 2015.

Forba did not respond to Jefferson’s motion, according to the Third Circuit.

Both parties engaged in a settlement conference before a magistrate judge. At the conference, the parties orally agreed to a settlement under which Jefferson would pay Forba $1,000 in exchange for a full release of his claims. Jefferson also agreed to draft and forward to Forba’s counsel a written settlement agreement to that effect. The magistrate judge reported the parties’ agreement to the District Court, and the District Court entered an order dismissing the action on that basis.

“Approximately two months later, Jefferson filed a motion to enforce the oral settlement agreement. Jefferson asserted that it had forwarded a written settlement agreement to Forba’s counsel, but that Forba’s counsel reported that Forba refused to sign it,” the Third Circuit’s judges said.

“Forba filed a counseled response in opposition. Forba attached a declaration stating that, ‘although the terms of the settlement were explained to me by Forba’s counsel and the magistrate judge, I was confused and anxious, and because of that I agreed to the settlement terms without fully understanding the matter,” the Court added.

The District Court then held a two-day evidentiary hearing, at which Jefferson’s counsel, Forba’s counsel and Forba himself all testified. Jefferson’s counsel testified that, when she called Forba’s counsel to follow up on the settlement agreement, he told her that Forba would not sign it because he had “changed his mind.”

Jefferson’s counsel also testified that Forba did not appear anxious during the conference, and both Jefferson’s counsel and Forba’s counsel testified that the magistrate judge fully reviewed the terms of the settlement with the parties – while Forba testified that his anxiety prevented him from understanding the settlement, but he agreed that he did not raise the issue of his anxiety or inability to understand with the magistrate judge, and that his anxiety did not prevent him from understanding what occurred during his previous deposition or at the evidentiary hearing itself.

The District Court entered an order granting Jefferson’s motion and deeming the parties’ oral settlement agreement enforceable. The District Court explained that it found Forba’s testimony that he did not understand the settlement when he agreed to it at the conference not credible, and concluded that Forba had merely changed his mind.

Forba appealed, claiming he did not agree to settle any case with the hospital for $1,000, despite testimony and evidence to the contrary.

The Third Circuit affirmed the District Court’s judgment and added three observations.

“First, under applicable Pennsylvania law, one of the factors that is relevant in determining a person’s mental competence to enter into a settlement and release is the amount paid for the release. At the time of the settlement in this case, Forba was seeking almost four years of back pay and reinstatement to his position. Thus, it may seem implausible at first blush that Forba would have knowingly released these claims in exchange for $1,000,” the Third Circuit said.

“As the District Court explained, however, the parties’ settlement discussions occurred against the backdrop of Jefferson’s motion for summary judgment. That motion raised several potentially dispositive arguments to which Forba never responded, and it could have resulted in a complete judgment in Jefferson’s favor. It is not implausible that Forba would have released his claims for $1,000 against that backdrop,” the Court added.

Secondly, the Court stated Forba “submitted to the District Court a potentially relevant note from a therapist but that the District Court did not admit it into evidence.”

“That note is from a therapist who treated Forba both before and after the settlement conference. As the District Court observed, the note largely reports Forba’s own statements to the therapist that his anxiety during the settlement conference prevented him from understanding the settlement. Forba’s therapist, whom Forba did not call as a witness, did not explain the basis for forming any independent opinion to that effect and did not affirmatively opine that Forba did not understand the settlement on the day of the settlement conference,” the Court said.  

“Thus, the District Court found Forba’s testimony regarding a lack of understanding not credible and concluded that Forba had simply changed his mind. To the extent that the note from Forba’s therapist can be read to express an independent opinion on these matter, it is too conclusory to support a contrary finding,” the Third Circuit said.

“Finally, as the District Court appreciated, the mere fact that Forba may have suffered from depression and anxiety in general does not require the conclusion that he did not understand the settlement. Forba presented no such evidence in this case,” the Court added.

The plaintiff is represented by Raheem S. Watson of Watson LLC.

The defendants are represented by Daniel J. McGravey and Gaetan Alfano of Pietragallo Gordon Alfano Bosick & Raspanti, plus Sarah Rachel Goodman of Greenberg Traurig, all in Philadelphia.

U.S. Court of Appeals for the Third Circuit case 16-3175

U.S. District Court for the Eastern District of Pennsylvania 2:15-cv-01722

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at

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