Parties typically enter into settlement agreements with the expectation that their agreement will resolve their dispute. But sometimes they will attempt to renegotiate their settlement, often due to commercial circumstances. In those cases, tricky issues can arise concerning the effect of a renegotiation on the terms of an otherwise valid settlement agreement.

One such issue is the effect of Federal Rule of Evidence 408 on the use of evidence from such renegotiations. FRE 408 deems inadmissible evidence of an offer to compromise a claim, or any conduct or statement made during compromise negotiations, if used to show the validity, or the amount, of such claim. 

The court's summary judgment opinion in Javelin Global Commodities (UK) Ltd. v. Lexington Coal Co. offers some insight into just that situation. No. 21-cv-787-AKH, 2024 WL 4265244 (S.D.N.Y. Sept. 23, 2024). There, plaintiffs sought to enforce the terms of an initial settlement agreement, while the defendant argued that the agreement was not binding and, alternatively, that the agreement had been modified after the parties agreed to the initial terms.