Chapter § 1.12 Settle or Trial

• Jurisdiction: United States
• Publication year: 2020

§ 1.12 Settle or Trial

[1] Case-by-Case Analysis

As discussed in section 1.11, in-house counsel consider many variables when deciding to settle or take a case to trial, and that decision is made on a case-by-case basis. “Each case is a business [decision] based on the cost, based on the impact on the company, and it is non-emotional.”⁹⁷ For companies, litigation is a risk and business cost, not a business opportunity. Thus, in-house counsel will often conduct a cost-benefit analysis when deciding how to resolve a case. They remind executives that litigation will be difficult, and it is better to have “an understanding of how to manage a dispute before it gets to litigation.”⁹⁸ Litigation is also uncertain and risky, so counsel must consider the impact a negative outcome may have on the company.

For example, counsel can use the cost-benefit approach when assessing how to resolve a number of nominal cases that, in the aggregate, can be very costly to defend. By settling these types of cases, the company might save money by avoiding the costs associated with disruptive, protracted litigation. This approach can reduce a company’s caseload by almost ten percent while cutting future costs.⁹⁹

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