Should You Accept the Settlement?: 5 Factors to Consider When Weighing Your Options
Nationwide statistics show that most lawsuits reach a settlement before they reach the trial stage. After all, people tend to gravitate towards the least risky option with the greatest certainty of reward. Still, if you’ve been offered a settlement for your business lawsuit, your case may not be so cut-and-dry. Consider the facts of your situation before you make any hasty decisions. 1) Do you have the time? It can be difficult to estimate the exact length of your trial, particularly because the other party may have opportunities to delay the court dates. Trials often begin several months or even years after a claim is made. Once you have reached a court judgement, the losing party can appeal the decision and prolong the process even more. Settlements are final, meaning the other party usually can’t make an appeal. With that in mind, ask yourself how much time and energy you are willing to expend on a trial. 2) Can you afford it? Just as trials can be lengthy, they can also be expensive. Attorneys’ fees aren’t the only costs you have to consider. Your out-of-pocket expenses can include court fees, travel, and lost time from work. You should also keep in mind the pre-trial discovery process, which may involve lengthy depositions to help you gain evidence and information to support your case (like an expert witness). Although you may be able to recover some of these costs with a successful lawsuit, you can eliminate many of them altogether when you accept a settlement. 3) What’s your risk-reward ratio? As with any other business decision, you should weigh the risks of a trial against the possibility of reward. Once you factor in the costs mentioned above, do you stand to recover a significant amount of money? What are the best and worst-case scenarios? A settlement offers the certainty that you will be paid; in court, you stand to lose money from an unsuccessful lawsuit. An attorney can help you estimate your risk-reward ratio to give you a clearer picture of the possibilities. 4) Will a trial create bad publicity? If you take your case to trial, the court documents will become public record, allowing anyone to access them—unless they are sealed by a judge. Could the trial spark negative publicity for your company or the other party? On the other hand, the details of a settlement are mostly kept private, and you can even add a confidentiality clause to your settlement agreement. 5) How strong is your evidence? You should have an attorney examine your case and determine the strength of your position. Even if you feel you are in the right, you might lack the type and amount of evidence to support your case in a court of law. Compare the other party’s case against your own. A sincere assessment of your case will allow you to form a more accurate risk-reward calculation. A settlement is often the least risky option, providing you with clear expectations about what you stand to gain. Even so, you may feel a personal connection to the case, a duty to challenge the constitutionality of a law, or a need to prove the fundamental “fairness” of your position. No matter where you stand right now, you should consult a lawyer to make your final decision. The attorneys at Campbell Law can help you determine the best course of action. Call us for personalized assistance with your business lawsuit or settlement decision.