## Facts

- Ali Haghighi, doing business as International Radio Network (IRN), distributed foreign-language radio programming to subscribers.
- Russian-American Broadcasting Company (RABC) provided Russian-language programming and contracted with IRN (March 23, 1993) to allow rebroadcast to IRN subscribers in the Minneapolis–St. Paul market.
- After the relationship deteriorated, IRN sued RABC in federal court (diversity) for breach of contract; RABC denied breach and counterclaimed for overdue payments.
- The parties agreed to mediate and signed a mediation agreement incorporating the Minnesota Civil Mediation Act, including language that a written mediated settlement is not binding unless it contains a provision stating it is binding.
- During a day-long mediation, the parties reached apparent agreement and reduced terms to a three-page handwritten document with 14 numbered terms.
- RABC’s counsel drafted most of the handwritten document; both sides’ counsel reviewed it, made and initialed revisions, and the party representatives signed each page.
- The handwritten settlement document did not include the statutory “binding” provision or the statutory advisories required by Minn. Stat. § 572.35, subd. 1.
- IRN moved to enforce the handwritten document as a binding settlement; RABC opposed enforcement, arguing the statutory omissions rendered it nonbinding.

## Issues

1. Whether Minn. Stat. § 572.35, subd. 1 precludes enforcement of a mediated settlement agreement that omits the statute’s required “binding” statement and advisories, where both parties were represented by counsel and signed a written settlement document drafted and approved by counsel.

## Decision

- The court held that Minn. Stat. § 572.35, subd. 1 did not bar enforcement of the alleged mediated settlement under the circumstances presented.
- The court rejected a strictly literal application that would automatically invalidate the settlement for lack of the statutory language.
- The court allowed enforcement proceedings regarding the handwritten settlement to go forward, treating the statute as not foreclosing enforcement in this case.

## Legal Principles

- A court may decline to treat Minn. Stat. § 572.35, subd. 1 as an automatic formal bar to enforcing a mediated settlement when both sides are represented by counsel and the evidence indicates they understood they were settling the dispute.
- Statutory interpretation should account for purpose and practical consequences; a reading that creates an unfair “trap” and undermines mediated resolutions may be disfavored when inconsistent with perceived legislative intent.
- Where counsel drafts and approves a settlement document during mediation, a party may face equitable obstacles to invoking counsel’s omission of statutory language to defeat enforcement.

## Conclusion

The district court ruled that Minnesota’s mediation-settlement formalities in § 572.35, subd. 1 did not, on these facts, prevent enforcement of a handwritten mediated settlement signed by represented parties, despite the absence of the statute’s “binding” statement and advisories, and it permitted the settlement-enforcement process to proceed.


Haghighi v. Russian-Am. Broad. Co., 945 F. Supp. 1233 (D. Minn. 1996)