MEMORANDUM & ORDER This case is before me on the plaintiffs’ motion to enforce an oral settlement agreement. In October 2020, the parties reported to Magistrate Judge Steven Gold that they had agreed to settle the matter, but they now dispute whether that agreement included certain provisions targeted to the risk of Defendants’ non-payment. The disputed provisions include, most prominently, one that would accord Plaintiffs a security interest in the personal residence of Elfreda Akintewe, the individual defendant and sole owner of Nike West. In a Report and Recommendation (“R&R”) dated August 16, 2021, Magistrate Judge Reyes recommended that I enforce the oral settlement agreement. R&R, ECF No. 30. Defendants filed a timely objection. Objs. to R&R 2, ECF No. 31. After an exhaustive review of the R&R, Defendants’ objections, and the fuller record, I adopt the recommendation and grant Plaintiffs’ motion to enforce the settlement. I. Background Plaintiffs Geneva Laboratories Limited and Union-Swiss (Proprietary) Limited filed suit in 2019 against Nike West African Import and Export Inc. and Ms. Akintewe, among others since dismissed. Geneva Labs, a foreign corporation, owns the rights to market and sell skincare oil products under the “BIOOIL” brand. Compl. 13, ECF No. 1. Geneva Labs licenses distribution rights to Union-Swiss. Id. at 14. Plaintiffs allege that Defendants imported, sold, distributed, and promoted skincare products that infringed Geneva’s registered trademarks. Id. at 1. The path to the purported oral settlement in October 2020 was long and difficult. After the parties engaged in discovery and early settlement discussions, Plaintiffs’ counsel sent a draft settlement proposal — styled as a “Stipulated Consent Judgment & Permanent Injunctive Order” — to Defendants’ counsel in March 2020 for his and his clients’ consideration. This draft agreement, which I will refer to as the “March Draft,” called for the Defendants to pay Plaintiffs $30,000 to settle the case. Draft Consent J. and Permanent Inj. dated March 13, 2020 (“Mar. Draft”), Ex. 3 to ECF No. 28-2. The March Draft did not provide for a security interest, either in Ms. Akintewe’s residence or otherwise. This draft sat for a few months until September 18, 2020, when Defendants’ counsel informed Plaintiffs that he had finally spoken with his client about the settlement.1 The parties participated in a telephone conference with Judge Gold on September 22, 2020. In the minute entry following that conference, the Court stated: The parties will continue their efforts to reach a settlement, and in particular to find a means by which defendants might provide security for payments they seek to make over time. THE COURT WILL HOLD A TELEPHONE CONFERENCE AT 11:30 AM ON OCTOBER 27, 2020, at which time counsel will be expected to report on the status of the parties’ settlement discussions and whether a settlement conference might be productive. Minute Entry of September 22, 2020 Conference, ECF No. 20. The parties reconvened on October 27. The parties discussed settlement; as is standard in settlement conferences in this district, the discussion was not recorded. Nevertheless, the parties agree that Judge Gold proposed a trade-off by which the settlement payment would be reduced to $15,000 and in return, the Defendants would agree to a lien on Defendant Akintewe’s Brooklyn residence. Nov. 20 Conference Transcript 6:13-19, ECF No. 26; see also Letter from Pls.’ Counsel on Behalf of all Parties 4, 7, ECF No. 23.2 Plaintiffs have asserted — and Defendants have not explicitly denied — that Judge Gold was proposing to insert these new terms into the March Draft. Specifically, Plaintiffs’ counsel “sought, and received, clarification from the Court that the proposal would not be in lieu of Defendants’ entry into” the March Draft of the Consent Judgment — that is, that the other terms in the March Draft would continue to form a part of the proposal.3 Pls.’ Position Statement in Nov. 11, 2020 Letter on Behalf of Both Parties 4, ECF No. 23. The minute entry following the October 27th conference states: “The Parties will consider the settlement recommendation proposed by the Court. THE COURT WILL HOLD A FURTHER TELEPHONE CONFERENCE AT 2:30 PM ON OCTOBER 30, 2020, at which time counsel will report on their position with respect to settlement.” ECF No. 21. The October 30 conference, too, went unrecorded, given the continuation of settlement discussions. The parties agree, however, that they reported to Judge Gold that they had reached agreement. (They now dispute what the scope of the agreement was, but not that they reported having reached one.) The minute entry following this conference states: “The parties report that they have reached a settlement. Counsel will submit a stipulation discontinuing the action, or a status report indicating why the parties have not done so, by NOVEMBER 20, 2020.” Minute Entry of October 30, 2020 Conference, ECF. No. 22. On November 4, Plaintiffs’ counsel sent a revised draft of the “Stipulated Consent Judgment” (the “November Draft”) to defense counsel. As expected, the November draft differed from the March Draft in that it called for Defendants to pay $15,000 rather than $30,000, and to do so in five installments rather than up front. See Draft Stipulated Consent J. & Permanent Inj. Order dated November 4, 2020 (“November Draft”) 7 (blacklined to show changes from the March 2020 Draft), Ex. 14 to ECF No. 28-2. In addition, the November draft called for a lien on defendant Akintewe’s residence to “guarantee Defendants’ compliance with the foregoing payment amount and schedule.” See id. 7(b). The November Draft also set forth two additional provisions responsive to the perceived credit risk: first, a provision that if the Defendants missed any scheduled payment, the unpaid balance of the settlement amount would be trebled and become due immediately; and second, that in the event of a non-payment, Plaintiffs would “automatically” be granted a lien on all of Defendants’ property, including bank accounts, vehicles, inventory, and wages. Id. 7(d). On receipt of the November Draft, defense counsel balked. He returned comments challenging not only the new provisions, but several provisions that were entirely unchanged from the March Draft — despite the record revealing no indication that he had objected to any provision of the March Draft at the October 27th or 30th conferences. Plaintiffs agreed to accept certain minor line-editing from Defendants. Given the larger impasse, however, the parties jointly filed a one-page letter indicating that settlement discussions had broken down. November 11, 2020 Letter on Behalf of Both Parties, ECF 23. The letter attached both parties’ statements of position on the settlement negotiation and a blackline of the November Draft. Plaintiffs’ position statement painstakingly recited their recollection of the October 27th and 30th conferences over four pages in an effort to demonstrate that all material terms in the November Draft had been agreed to before Judge Gold and, in particular, that the lien on defendant Akintewe’s house was to take effect upon execution of the settlement. Plaintiffs asked Judge Gold to enforce the oral agreement that the parties had acknowledged on the record and cited case law in support of that contention. Pls.’ Position Statement 5-6. Defendants submitted a much briefer position statement. They contended that they understood from the settlement conferences that the security interest would attach to Akintewe’s home only if and when Defendants failed to pay the settlement on the agreed schedule. See id. at 7 (expressing defendants’ position that “contrary to the agreement made at the October 30, 2020 conference, plaintiffs now insist that they must be granted a lien on defendant Elfreda Akintewe’s home, whether the defendants default in the payments or not”). Defendants also disputed several provisions that were unchanged from the March Draft. After receipt of this correspondence, Judge Gold held a conference on November 20 — this time on the record. Minute Entry, ECF No. 25; Tr. of Proceedings on November 20, 2020, ECF No. 26. He opened by stating that he “recall[ed] things as plaintiffs described” in their position statement, see id. at 2:18-22 — specifically, “that the parties had agreed on all material terms of the settlement, including the consent decree that…plaintiffs had forwarded to the defendants.” Id. at 3:2-5.4 Nevertheless, Judge Gold said that he would afford the parties an opportunity to brief the question of whether he should enforce the oral agreement. He subsequently construed the Plaintiffs’ November 11 letter as a motion to enforce the oral settlement agreement. See ECF No. 25. After Judge Gold’s retirement from the bench, I referred the motion to enforce to Magistrate Judge Reyes for report and recommendation. See Order Dated January 19, 2021. Judge Reyes submitted his R&R on August 16, 2021. The R&R recommends that the settlement be enforced, concluding that the parties orally agreed to a binding contract at the October 30 conference before Judge Gold. Defendants objected. II. Legal Standard on Review of Report & Recommendation A district court “may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge.” 28 U.S.C. §636(b)(1). Within fourteen days after a party has been served with a copy of a magistrate judge’s R&R, the party “may serve and file specific, written objections to the proposed findings and recommendations.” Fed. R. Civ. P. 72(b)(2). When a party submits a timely objection, a court “shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made.” 28 U.S.C. §636(b)(1)(C). III. Discussion This dispute requires the Court to evaluate two related ?? but distinct ?? questions. First, whether the parties reached an agreement: in other words, when the parties advised Judge Gold that they had reached an oral agreement, had they actually formed a meeting of the minds, and on what terms? “A court cannot enforce a contract unless it can determine to what the parties agreed.” 28 Glen Banks, New York Contract Law §2:25, at 81 (2d ed. 2017) (citing 166 Mamaroneck Ave. Corp. v. 151 E. Post Rd. Corp., 78 N.Y.2d 88, 91 (1991)).5 The second question is whether, assuming the parties reached an oral agreement, they nevertheless manifested an intent to be bound only by a signed writing, such that the court should not enforce the oral agreement even though the requirements for a binding contract were otherwise satisfied. It is well-settled that when a party to a contract negotiation “communicates an intent not to be bound until he achieves a fully executed document, no amount of negotiation or oral agreement to specific terms will result in the formation of a binding contract.” Winston v. Mediafare Ent. Corp., 777 F.2d 78, 80 (2d Cir. 1985). The R&R deals primarily with the second of these two questions, thoroughly analyzing whether the parties intended to be bound by the oral agreement they reported. The R&R applies the familiar four-factor test laid out in Winston v. Mediafare Entertainment Corp., 777 F.2d 78 (2d Cir. 1985). Like the R&R, Winston began and ended with the second of the two questions above, perhaps because it was immediately apparent in that case that one party had manifested an intent only to be bound by a written and executed agreement. Among other clear indications, the Winston court pointed to a promise by the attorney for the plaintiff (the party seeking to enforce the oral agreement) that he would hold the settlement check in escrow “pending execution by my client and delivery to you of two fully executed copies of the agreement.” Id. at 81. This language, the court held, “confirmed the obvious understanding that the settlement contract would not be effective until executed by both sides,” contrary to the plaintiff’s new position. Id. Here, unlike in Winston, I find below that the parties did not manifest an intent only to be bound by a signed writing (as Judge Reyes also held). For that reason, I must answer the prior question (whether the parties reached a meeting of the minds, and on what terms) before reaching the second (whether a signed writing was required).6 A. The parties reached a valid oral agreement on all material terms in the November Draft of the Stipulated Consent Judgment. A “settlement is a contract…[and] once entered into…is binding and conclusive.” Powell v. Omnicom, 497 F.3d 124, 128 (2d Cir. 2007). Settlement agreements are “interpreted according to general principles of contract law.” Velazquez v. Yoh Servs., LLC, No. 17-CV-842, 2017 WL 4404470, at *2 (S.D.N.Y. Sept. 25, 2017). “The party seeking to enforce a purported settlement agreement bears the burden of proving that such a binding and enforceable agreement exists.” Grgurev v. Licul, No. 15-CV-9805, 2016 WL 6652741, at *3 (S.D.N.Y. Nov. 10, 2016); see also Fleming v. Ponziani, 24 N.Y.2d 105, 111 (1969) (“[P]laintiff, in undertaking to prove the contract upon which his action is based, had cast upon him the burden of establishing, by a preponderance of the evidence, that it was a good and valid contract….”).7 “To form a valid contract under New York law, there must be an offer, acceptance, consideration, mutual assent and intent to be bound.” Register.com, Inc. v. Verio, Inc., 356 F.3d 393, 427 (2d Cir. 2004). The offer, acceptance, and manifestation of intent do not need to extend to every potential contract term — only the material terms. “If an agreement is not reasonably certain in its material terms, there can be no legally enforceable contract.” Cobble Hill Nursing Home, Inc. v. Henry & Warren Corp., 74 N.Y.2d 475, 482 (1989); see also In re Express Indus. & Terminal Corp. v. N.Y. State Dep’t of Transp., 93 N.Y.2d 584, 589 (1999) (“To create a binding contract, there must be a manifestation of mutual assent sufficiently definite to assure that the parties are truly in agreement with respect to all material terms.”). “[A]t some point virtually every agreement can be said to have a degree of indefiniteness,” but “parties…should be held to their promises.” Cobble Hill, 74 N.Y.2d at 483. “In contract law, ‘essential terms’ are those terms that are necessary in order to lend an agreement sufficient detail to be enforceable by a court.” Reyes v. Lincoln Auto. Fin. Svcs., 861 F.3d 51, 58 (2d Cir. 2017). The standard is “necessarily flexible,” and courts should try not to apply it with “a heavy hand.” Cobble Hill, 74 N.Y.2d at 482-83. There must be “an objective meeting of the minds sufficient to give rise to a binding and enforceable contract.” Starke v. SquareTrade, Inc., 913 F.3d 279, 289 (2d Cir. 2019). “In determining whether the parties intended to enter a contract, and the nature of the contract’s material terms, we look to the objective manifestations of the intent of the parties as gathered by their expressed words and deeds.” Stonehill Cap. Mgmt., LLC v. Bank of the West, 28 N.Y.3d 439, 448-449 (2016) (emphasis added). “[D]isproportionate emphasis is not to be put on any single act, phrase or other expression, but, instead, on the totality of all of these, given the attendant circumstances, the situation of the parties, and the objectives they were striving to attain.” Brown Bros., 41 N.Y.2d at 399-400. Here, Plaintiffs have carried their burden of demonstrating that the parties manifested a meeting of the minds on the oral agreement and all its material terms. As discussed below, those agreed-upon terms are: all terms contained in the March Draft, plus a small number of material terms added in the November Draft — namely, the new (lower) dollar amount of the settlement payment and the new payment schedule; the lien on defendant Akintewe’s residence on East 103rd Street in Brooklyn; the provision for treble damages in the event of a payment default; and a few minor edits by defense counsel, listed below. There is one new provision in the November Draft for which the record reveals no evidence of mutual assent (namely, the provision for a springing judgment lien on bank accounts, vehicles, and the like), but that provision is not material to the parties’ meeting of the minds, for the reasons discussed below. The Terms in the March Draft. Judge Gold specifically stated his recollection that the parties’ oral agreement extended to the terms in the March Draft. At the November 20 conference, Judge Gold stated: I made a settlement recommendation [on October 27th]. Then on October 30th, I was told that the parties reached a settlement and it was totally my understanding, and I’m saying this for the record so that we can refer back to it later, that the parties had agreed on all material terms of the settlement, including the consent decree that…plaintiffs had forwarded to the defendants. Nov. 20, 2020 Conf. Tr. 2:24-3:5 (emphasis added). Plaintiffs have produced evidence to support this conclusion as well, in the form of attorney Richard Straussman’s comprehensive declaration (made under penalty of perjury). See Dec. of Richard Straussman, Esq. (“Straussman Decl.”)
