## Facts

- Ali Haghighi, doing business as International Radio Network (IRN), distributed foreign-language radio programming to subscribers in the Minneapolis–St. Paul area.
- Russian-American Broadcasting Co., L.P. (RABC) provided Russian-language programming and contracted with IRN in 1993 to allow rebroadcasting over IRN’s signal.
- After the relationship deteriorated, IRN sued RABC in federal court in 1995 for breach of contract; RABC denied breach and asserted a counterclaim for unpaid amounts.
- The parties agreed to mediate under the Minnesota Civil Mediation Act and signed a mediation agreement that tracked Minn. Stat. § 572.35’s requirements for mediated settlement agreements.
- At the end of mediation, with counsel present, the parties’ attorneys drafted a three-page handwritten document listing 14 settlement terms; counsel reviewed and initialed changes, and each party signed each page.
- The handwritten document did not include the statutorily required conspicuous statement that the agreement was binding and advising parties of attorney review and related consequences.
- IRN moved to enforce the handwritten document as a settlement; the federal district court, after an evidentiary hearing, found the parties intended it to be binding and enforced it.
- On appeal, the Eighth Circuit certified to the Minnesota Supreme Court whether the handwritten, signed mediation document was unenforceable under Minn. Stat. § 572.35, subd. 1 due to the missing statutory statement.

## Issues

1. Whether a written, signed mediation term sheet is unenforceable as a mediated settlement agreement under Minn. Stat. § 572.35, subd. 1 when it lacks the required conspicuous “binding agreement” statement and advisories.
2. Whether parties’ intent to be bound, signatures, counsel participation, and inclusion of statutory language in a separate mediation agreement can substitute for the statutory requirements in the settlement document itself.

## Decision

- The court answered the certified question “yes”: the handwritten document was unenforceable as a mediated settlement agreement under Minn. Stat. § 572.35, subd. 1.
- The statute’s text made enforceability conditional on inclusion of the specified conspicuous statement within the settlement agreement itself; the handwritten document failed that condition.
- Evidence that the parties subjectively intended the document to be binding could not cure noncompliance with the statute’s formal prerequisites.
- The required language could not be supplied by a separate mediation agreement; the statute required it in the settlement agreement document.
- The court rejected substantial-compliance and equitable arguments that would permit enforcement despite the omission.
- The ruling was limited to enforceability “as a mediated settlement agreement” under the statute, given the certified-question posture.

## Legal Principles

- Under Minn. Stat. § 572.35, subd. 1 (as applied), a mediated settlement agreement is not binding unless it is written and contains a prominently displayed statement that it is binding and advises parties of attorney review and related consequences, with required formatting (bold, capitals, or underlining).
- Statutory formalities governing mediated settlements operate as conditions to enforceability and are not replaced by common-law contract intent or post hoc proof of assent.
- Compliance must appear in the settlement agreement itself; placing the statutory warning language in a separate mediation agreement does not satisfy § 572.35, subd. 1.

## Conclusion

The Minnesota Supreme Court held that a mediation term sheet signed at the session is unenforceable as a mediated settlement agreement when it omits the conspicuous statutory “binding” statement and advisories required by Minn. Stat. § 572.35, subd. 1, even if the parties intended to be bound and were represented by counsel.


Haghighi v. Russian-American Broad. Co., 577 N.W.2d 927 (Minn. 1998)