Public interest attorney representing claimant in an NJLAD and CEPA claim may negotiate resolution that includes payment of fees. However, restrictions exist on terms and conditions that may be attached to offer of settlement.

The plaintiffs retained legal services and instituted an action alleging causes of action under both the NJLAD and CEPA. At a court ordered mediation, a tentative settlement was reached. However, an issue arose concerning whether the settlement included attorney's fees. Legal Services took the position that based upon the Supreme Court's prior decision in Coleman v. Fiore Bros, the negotiations and settlement could not have included attorney's fees as a matter of law. In a case of first impression, the New Jersey Supreme Court concluded that the plaintiffs represented by Legal Services may simultaneously negotiate the settlement of the merits of the claim and attorney's fee claims. However, a defendant may not insist upon a waiver of fees as part of a settlement or dictate how settlement proceeds should be divided between the public-interest attorney and the client.

Case Law Alert - 2nd Qtr 2010