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Wal-Mart Stores, Inc. v. Coughlin

Arkansas Supreme Court
369 Ark. 365 (2007)

Written by Sean Carroll, JD

Facts

Thomas Coughlin (defendant) worked for Wal-Mart Stores, Inc. (Wal-Mart) (plaintiff) for over 25 years, eventually becoming vice chairman of Wal-Mart’s board of directors. Upon Coughlin’s retirement, Coughlin and Wal-Mart signed a retirement agreement. The agreement contained a release, under which the parties released each other from liability for all claims, “known or unknown.” Subsequently, a Wal-Mart investigation revealed that Coughlin had worked with other Wal-Mart employees to misappropriate company funds. Throughout Coughlin’s employment, he had signed certain certifications and disclosures, which included an attestation that he was not engaged in any misconduct. Wal-Mart sued Coughlin seeking to void the retirement agreement on the ground that his misrepresentations in the certifications fraudulently induced Wal-Mart to enter into the agreement. Coughlin filed a motion to dismiss for failure to state a claim, arguing that the release in the retirement agreement barred the lawsuit. The circuit court granted the motion. Wal-Mart appealed.

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Holding and Reasoning (Brown, J.)

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