## Facts

- Richard Paul Carsten sued Patricia Dosdourian and Christine DeMario for negligence arising from an auto accident causing serious injuries.
- Shortly before trial, Carsten and DeMario entered a secret settlement under which DeMario paid her $100,000 policy limits, and DeMario agreed to continue participating in the case through trial and judgment.
- Carsten moved in limine to prevent disclosure of the agreement to the jury.
- The trial court granted the motion, ruling the agreement would not be disclosed unless DeMario testified live; if Dosdourian called DeMario, Dosdourian could not raise the agreement.
- Dosdourian sought to dismiss DeMario from the case; the trial court denied the request.
- At trial, Carsten introduced only DeMario’s deposition taken before the settlement; DeMario did not testify live, and the jury was not informed of the settlement.
- The jury allocated fault 35% to Dosdourian, 55% to DeMario, and 10% to Carsten, and awarded more than $2 million in damages.

## Issues

1. Whether a non-settling defendant is entitled to have the jury informed of a settlement in which a co-defendant’s payment obligation is fixed but the co-defendant must remain in the lawsuit.
2. Whether Mary Carter–type agreements are permissible in Florida and, if so, under what limits.

## Decision

- The Florida Supreme Court quashed the district court’s affirmance and remanded for a new trial.
- The Court held that the agreement was an impermissible Mary Carter–type arrangement.
- The Court prohibited Mary Carter agreements in Florida as contrary to public policy.
- The Court overruled prior Florida precedent to the extent it allowed such agreements subject to disclosure requirements.

## Legal Principles

- Mary Carter agreements—secret arrangements that cap one defendant’s exposure while requiring that defendant to continue as an apparent adversary—are void as against public policy in Florida.
- Such agreements are inherently deceptive because they create a false appearance of adversity, realign incentives, and risk collusion against non-settling defendants.
- Disclosure rules were deemed inadequate because the core problem is the agreement’s distortion of the adversarial process and the jury’s truth-finding function.
- When a secret agreement of this type affects the fairness of trial proceedings, the proper remedy is reversal and a new trial.

## Conclusion

The court held that secret settlements requiring a settling defendant to stay in the case while having fixed exposure are forbidden in Florida because they mislead the jury and corrupt the adversarial process; the judgment was reversed and a new trial ordered.


Dosdourian v. Carsten, 624 So. 2d 241 (Fla. 1993)