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SB 406

Va. State Bar, et al.; use of nondisclosure/confidentiality prov. in certain settlement agreements.

2026 Regular Session Introduced by Jennifer Boysko

SB 406 restricts confidentiality clauses in Virginia settlement agreements to increase transparency about misconduct while balancing privacy and settlement incentives.

Fiscal Impact Statement from Department of Planning and Budget (SB406)
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Bill Summary · SB 406

Legislative bill overview

SB 406 restricts the use of nondisclosure and confidentiality provisions in settlement agreements, particularly in cases involving certain claims (likely misconduct, harassment, or discrimination). The bill seeks to limit parties' ability to keep settlement terms secret when public interest or accountability concerns are involved. It has been referred to the Committee for Courts of Justice and a fiscal impact statement was requested.

Why is this important

Settlement confidentiality clauses are common in litigation but can shield wrongdoing from public view—allowing individuals or organizations to settle claims repeatedly without disclosure. This bill addresses the tension between a defendant's interest in privacy and the public's interest in knowing about patterns of misconduct, particularly in sensitive areas like workplace harassment or professional ethics violations. The impact on Virginia's legal system, insurance practices, and plaintiff protections could be significant.

Potential points of contention

  • Victim privacy vs. public accountability: Survivors may want confidentiality for personal reasons, but disclosure could warn others; the bill must balance both interests
  • Business and defendant concerns: Organizations argue confidentiality encourages settlement and protects legitimate reputation interests; broad restrictions could deter settlements and increase litigation costs
  • Definition and scope: Unclear which "certain settlement agreements" are covered—the breadth will determine practical impact and may face constitutional challenges around free speech and contract rights

Compiled from official sources — confirm details with the bill’s official record.

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