Court Finds Severance Agreement Existed; Holds Defendant Liable for Breach of Contract

In Nusbaum v. E-Lo Sportswear LLC, 2017 WL 5991787 (S.D.N.Y. Dec. 1, 2017), teh court held that the plaintiff and defendant entered into a legally enforceable employment contract for, inter alia, nine months’ severance pay if plaintiff was terminated.

In reaching this conclusion, the court applied the so-called “Winston factors”, based on Winston v. Midiafare Entmt Corp., 777 F.2d 78 (2d Cir. 1985):

(1) whether there has been an express reservation of the right not to be bound in the absence of a writing; (2) whether there has been partial performance of the contract; (3) whether all of the terms of the alleged contract have been agreed upon; and (4) whether the agreement at issue is the type of contract that is usually committed to writing.

The court found that all four factors favored plaintiff, and that “the parties had agreed to all necessary elements of the contract and are, therefore, bound to the ultimate objective despite the fact that a more formal or elaborate writing ha[d] yet to be produced.” It pointed to emails between plaintiff and defendant’s president and CEO to demonstrate that they clearly agreed to nine months’ severance in the event of plaintiff’s termination.