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When Settlement Negotiations Go Awry, OCAHO Steps In to Cure

[Editor’s Note: Today’s blog is authored by Bruce E. Buchanan, an Attorney at the Nashville Office of Siskind Susser, P.C.]

The Office of the Chief Administrative Hearing Officer (OCAHO), in early February 2013, decided Immigration & Customs Enforcement (ICE) and an employer, California Mantel, Inc., reached a settlement agreement, which allowed the employer not to admit any violations of Immigration Reform and Control Act (IRCA) and precluded the need to enter into a Consent Decree. This decision has an interesting discussion on settlement negotiations and whether the parties reached a “mutual understanding” on the terms of the agreement.


After an investigation, ICE issued a Notice of Intent to Fine to California Mantel based on 23 violations of IRCA. Thereafter, Counsel for California Mantel requested a hearing and the parties entered into negotiations to resolve the matter. The negotiations occurred through a series of e-mails between ICE Counsel and Counsel for California Mantel. Initially, the parties were $2,000 apart with ICE seeking $9,000 and California Mantel agreeable to a $7,000 fine. ICE counsel offered to split the difference and agree to $8000. (Sounds like negotiations to buy a car.) The company’s counsel agreed on behalf of her client.  The specific e-mails stated:

Company: My client is willing to pay $8,000 to settle this matter, each side to bear its own fees and costs. Will you prepare an agreement? ICE: Great news, glad to hear it. Yes I will prepare the settlement agreement and the other documents that will need to be finalized. I should be able to get you the settlement agreement by Thursday.

About 10 days later, ICE Counsel sent the following documents: “Consent Findings, Motion to Approve Consent Findings, and Proposed Order approving consent findings.” The Consent Decree stated:

Respondent would withdraw both its denial of the allegations in the complaint and its request for hearing, and would admit to twenty-three specifically described violations. Paragraph eight provided that the respondent understood that those twenty-three violations were a first offense….

Company counsel responded:

My client never agreed to admit to liability (which would be a fairly significant and material term of our settlement agreement and which was never discussed or mentioned in our negotiations). Accordingly, the consent findings are not acceptable. We agreed to settle for $8,000 in exchange for a dismissal. Please advise as to whether you would like us to revise the documents or whether you intend to do so.

ICE counsel refused to revise the paperwork and the matter proceeded to OCAHO.

Type of Resolutions between ICE and an Employer

ICE settlements are achieved in one of two possible ways. One, an agreement based on consent findings with the Administrative Law Judge finalizing such a resolution. Second, it requires only that the parties notify the Administrative Law Judge that they have reached a settlement and agree to a dismissal of the case.

OCAHO’s Decision

Although neither party contended the communications were ambiguous, the parties disagreed as to the significance of the communications, and “each seeks to draw different inferences as to their implications by emphasizing particular words and phrases that were either used or omitted during the negotiations.” OCAHO found the record reflected no reference was made during the negotiations to the words, “consent decree” or “consent findings,” which is an official, court-sanctioned agreement.  Furthermore, there was no mention was made by either party of a term proposing that California Mantel would admit to liability. “The terminology consistently used by the parties was ‘settlement agreement,’ not ‘consent findings’ or ‘consent decree.’” OCAHO discussed the meaning of a contract (which took all of us lawyers back to Contracts in first year of law school).  It stated, “The standard for determining intent is thus an objective one and a party’s unexpressed intent is irrelevant. All that is required to form a contract is a manifestation of mutual assent to an exchange, and consideration for the bargain.” Based upon the objective intent of the parties, OCAHO found the parties intended a “settlement agreement”, not a consent decree. Furthermore, ICE was “not free to change its mind and repudiate the agreement.” Thus, OCAHO enforced the settlement agreement and dismissed ICE’s complaint.

Meaning of Decision

What does this mean for immigration compliance attorneys and their clients? It certainly provides an easier way to resolve IRCA violations if ICE counsel will agree to a settlement agreement, not a consent decree. A major advantage is that the company is not admitting any liability through a settlement agreement. Interestingly, many other government agencies have consistently agreed to a non-admissions clause in settlements. I worked for the National Labor Relations Board for 20 years and I would estimate 90% of the settlements included non-admissions clauses. The only times that the agreements didn’t were when the employers failed to request such or there were egregious and/or receptive violations.   Other agencies, such as the Securities and Exchange Commission (SEC) and Office of Special Counsel (OSC) also regularly agree to non-admissions clauses.

About the Author

Bruce E. Buchanan is an Attorney at the Nashville Office of Siskind Susser, P.C. He represents individuals and employers in all aspects of immigration law, with an emphasis on employer immigration compliance, as well as employers in employment/labor law matters. He is Past-Chair of the Tennessee Bar Association’s Immigration Law Section from 2011 to 2012 and has been the editor of the TBA’s Immigration Law Section Newsletter and the TBA’s Labor and Employment Law Section Newsletter since 2009. Mr. Buchanan also serves on the Board of Directors for the Nashville International Center for Empowerment (NICE) and the United Cerebral Palsy of Middle Tennessee and Middle Tennessee Seminole Club. He is an associate member of the Mid-Tennessee Chapter of the Associated Builders & Contractors (ABC).