Answer:
When something bad happens and it’s not your fault, you want to be made whole yesterday. If only the legal process worked so quickly. A better way to think about this question is a series of questions: What amount of money will provide fair compensation for the damages sustained? How likely is it that we are going to prevail at trial? How much would the defense have to offer such that accepting the certainty of that offer is more favorable than the delay and risk of moving forward with the case? What can yet happen during the course of litigation that might persuade a defendant to increase its offer?
A threshold concept to consider is that even the strongest of cases require the other side to be willing to pay fair compensation in order for that case to be resolved. While a jury verdict against a defendant is a compulsory mechanism that we can use to compel payment, everything short of that requires the willingness of both sides to come to the table to negotiate and strike a deal.
Many factors that come into play during settlement discussions depend on a client’s personal mindset. Everyone is cut a bit differently. Some clients have a larger appetite for risk than others and are more inclined to take the risk of a trial. Litigation is a lengthy process and some clients would be willing to settle for slightly less money at the outset of a case rather than live with it through a long and stressful litigation process. Sometimes a fair offer, even one is at the lower end of reasonable, is going to be more enticing to some clients than it will to others who don’t mind wrestling in the mud with hogs.
Decision Points
Having mentioned some of the factors that influence settlement of a case, let’s talk about when settlement windows are open their widest. There are events during the pendency of a case when, depending on which issues are disputed, the opportunity to resolve the case might be ripe. These windows of opportunity include:
The filing of a lawsuit - sometimes the filing of a lawsuit, in and of itself, is sufficient motivation to pressure a defendant to increase its settlement offer. Reasons for this may include that they know they will have to incur more costs to defend the case or that filing a lawsuit requires different people with different opinions to get involved in a case.
After the plaintiff’s deposition - If there are questions about what kind of witness a plaintiff will be or unexplained issues about events that transpired, these can often be clarified at a deposition. If they are clarified convincingly, a defendant may be motivated to come to the table to discuss settlement.
After a defendant’s deposition - Similarly, the defendant’s deposition can be clarifying as to how events might play out at trial. If a defendant does not leave their attorney and insurer confident in their theory of a case, it might invite an opportunity to settle.
After doctors’ depositions - If a plaintiff’s injury or recovery is complicated in nature or complicated by factors such as other unrelated injuries or degenerative conditions a doctors testimony clarifying how the underlying problems relate to the lawsuit can enlighten defendants as to the issues claimed in a case and put to rest any thoughts that problems are not related to a lawsuit, thus inviting a potential settlement discussion.
Leading up to trial - The risk and resources commanded by trial cause all parties to take a good long look in the mirror as to the stakes and outcomes of going to trial. The weeks leading up to trial typically invite parties to put their best settlement positions on the table.
These are just a few of the more common circumstances when a settlement discussion might be ripe. Each case has its own unique set of circumstances which make some settlement influencing factors more important than others. There are also many items that motivate defendants and insurance companies that we, on the plaintiff’s side, have little knowledge of or control over. Such factors include company policies in certain cases, strategies they want to test, or facts they wish to hide that would otherwise come out in litigation. Such factors are difficult to identify, even in hindsight, but likely significantly contribute to settlement discussion in certain cases.