Federal Rule of Evidence 408 is kind of a funny thing. It says that settlement conduct and discussions are inadmissible "to prove or disprove the validity or amount of a disputed claim" or for impeachment.
That's significant, but it leaves open a lot of potential uses of settlement communications throughout the case—not to mention in later cases, potentially on different claims. The rule explicitly sets forth that such communications and conduct are still admissible for other purposes:
(b) Exceptions. The court may admit this evidence for another purpose, such as proving a witness’s bias or prejudice, negating a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution.
FRE 408.
Nonetheless, sometimes attorneys seem to imagine that FRE 408 automatically renders settlement discussions sealed, even in the absence of an NDA between the parties, a protective order, or designation under Local Rule 26.2.
That's simply not true. If you want settlement negotiations to be sealed, you cannot just rely on FRE 408.
Yesterday we saw an order from the Court making this point. In Pratt Retail Specialties, LLC v. ProAmpac Holdings Inc., C.A. No. 24-1073-RGA (D. Del.), counsel filed a motion to enforce a settlement agreement, along with a related brief. They filed the brief under seal and filed a redacted version, in which they redacted the exhibits in full. Given that this is a case before Judge Andrews, they also filed a declaration explaining why the documents are redacted in full, including because they are FRE 408 settlement communications.
The Court did not go for that, and pointed out that FRE 408 is not a basis to seal documents from the public:
ORAL ORDER: The court has read D.I. 123 [the declaration] and it is insufficient. For example, it states that Exh. A needs to be totally redacted because it contains "sensitive and confidential email communications." Exh. A is an email chain over four days in February setting up a phone call to discuss settlement. Exh. A was filed in support of a motion to enforce a settlement agreement. Revealing that the parties had a telephone call before purportedly reaching a settlement is not exactly information that will cause a harm to any party. I am confident, based on Exh. A, but without actually reviewing the other exhibits, that many of them dont need redaction or need only minimal redaction. I suspect that is true of the briefing too. . . . I note that simply saying the communications were protected by Rule 408 does not mean they may be sealed. Ordered by Judge Richard G. Andrews on 4/28/2926.
Pratt Retail Specialties, LLC v. ProAmpac Holdings Inc., C.A. No. 24-1073-RGA, D.I. 125 (D. Del. Apr. 28, 2026).
The Court also noted that the parties get only one chance to correct this before the documents are simply unsealed:
I will give the parties one chance to review the recently filed sealed documents and exhibits . . . and file new versions that reflect an appropriate effort to only redact when necessary to protect against a clearly defined and serious injury to the parties. If the parties do not comply with this order, I will not "blue pencil" the sealed documents; I will simply unseal them.
Id. Definitely something to keep in mind!
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