P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

TERRY L. KING, Complainant

K-MART, Respondent

ERD Case No. CR200103479

An administrative law judge (ALJ) for the Equal Rights Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.


The decision of the administrative law judge (copy attached) is affirmed.

Dated and mailed August 28, 2003
kingter2 . rsd : 110 :  

/s/ David B. Falstad, Chairman

/s/ James T. Flynn, Commissioner

/s/ Robert Glaser, Commissioner


This case arose under Wisconsin's Public Accommodations discrimination law, Wis. Stat. § 106.52 et seq. The complainant, Terry King, alleged that K-Mart discriminated against her because of her race when security guards from the store followed her and required her to submit to a search. An Initial Determination found probable cause and the case was certified to hearing. Hearing was scheduled for April 24, 2002. However, that hearing was cancelled and the matter was ordered held in abeyance when it developed that K-Mart had filed a petition in bankruptcy court.

On May 9, 2002 K-Mart filed with the ERD a copy of a "General Release and Settlement Agreement" between, and executed by, K-Mart and the complainant. This document provided, among other things, that King would have "an allowed general prepetition unsecured claim in the amount of $5,000" in the bankruptcy proceeding, and that for that consideration the complainant "agree[d] to dismiss her charges against Kmart Corporation pending with the Wisconsin Equal Rights Division Case Number CR200103479".

Subsequently, the ALJ had a number of contacts with the parties concerning questions including whether the settlement agreement was subject to the approval of the bankruptcy court, whether the complainant had retained counsel, and whether and when the complainant would execute a withdrawal request in view of the settlement. These contacts included a telephone conference call, regular correspondence, and certified mail correspondence. Eventually, the ALJ issued an order on March 14, 2003, which dismissed the complaint with prejudice. He based his order on the settlement, and he also relied in the alternative on Wis. Stat. § 111.39(3) (failure to respond to correspondence from the department concerning the complaint).

The complainant has petitioned for review from this order. She argues that Kmart has not kept their end of the contract they signed, to pay her $5,000.

As noted, Kmart filed a copy of the settlement agreement with the ERD. It clearly shows that it was signed by the complainant on May 1, 2002. The complainant does not dispute this; indeed, her petition for commission review affirmatively acknowledges that she signed the settlement agreement. She is simply arguing that Kmart has not yet complied with its terms by paying her the amount specified.

It could be speculated, that the actual payment of the specified consideration to the complainant may have been delayed because of developments (or lack of developments) in the bankruptcy proceeding. Ultimately, however, that is not relevant to the issue presented by the petition for review. The commission has held that, once a settlement agreement is entered into, a dispute about whether its terms have been complied with does not affect the validity and finality of an agreement made as part of that settlement that proceedings before the ERD will be dismissed. See, e.g., Gronowski v. Milwaukee Co. (LIRC, 04/13/98) (ERD does not have authority to decide what are in effect breach of contract questions regarding whether settlement agreements have been breached). It is undisputed that the settlement agreement was actually signed by the complainant, and that the agreement on its face clearly provides that the complainant agrees to the dismissal of her complaint. Given those facts, it was not necessary for the ALJ to also obtain a separate withdrawal form from the complainant. See, Gronowski, supra., Walsh v. Tom A. Rothe SC (LIRC, 11/29/02). Dismissal of the complaint was appropriate based on the undisputed fact that the complainant had agreed to such in the settlement agreement she signed.

Because it agrees that dismissal of the complaint was warranted on the basis of the settlement agreement, the commission does not find it necessary to address the alternate basis upon which the ALJ rested his order.

Angela McGinnis
Employment Paralegal
Kmart Corporation

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uploaded 2003/09/02