Brown & Charbonneau, LLP – Settle or Have Your Day In Court

Watch the following video, or read below, where Board Certified Trial Specialist Gregory G. Brown discusses whether it may be best to settle, or have your day in court.

Brown & Charbonneau, LLP – Settle or Have Your Day In Court from James on Vimeo.

Most business litigation ends with a settlement, often the earlier you can settle the greater the economic benefit. Settlement may provide benefits not available through litigation. For example, one party might offer business concessions to the other even on issues not involved in the litigation. The parties could agree that the settlement will be paid over time, with collateral to secure the payment. As the case progresses you and your attorneys should conduct an ongoing risk benefit analysis. This analysis, coupled with proper timing of settlement overtures, can be the key to a favorable outcome. Whether you’re the plaintiff or the defendant, here are six factors to consider when conducting your cost benefit analysis.

Number one, time demands. Litigation takes significant time away from your business operations. Some time consuming tasks include finding relevant documents, and responding to discovery, communicating with your attorneys, training your employees to support the litigation process, and making them available for deposition and trial.

Number two, litigation expenses. Costs amount dramatically as litigation proceeds experts must be paid court costs, travel expenses, witness fees, and other incidental charges are incurred. Attorneys fees can mount as well. Now, sometimes payment for attorneys would work on a contingency basis and they’ll generally take a third of the recovery. But, at trial, they may take as much as 50%, if attorneys are billing hourly the longer the litigation continues, obviously the higher the fees.

Number three, the strength of the claims and defenses. Evidence that puts the case in a different light may emerge from discovery and even testimony before or at trial. A plaintiff’s claims or a defendant’s defenses and counterclaimed may be stronger or weaker than they initially appeared.

Number four, the amount it issue and the likelihood of collecting. Now if a plaintiff knows its damages are minimal, or the defendant lacks insurance, or other means to pay taking the case to trial may not make economic sense.

Number five, damage is to your business’s reputation. Aside from legal liability, a business needs to keep its reputation in mind and negative perception can affect revenue. If a company sues a long-standing client for a default, that it could have resolved with a business resolution, others may notice and take their business elsewhere.

Number six, preservation of business relationships. A lawsuit can damage or destroy a profitable business relationship. An early settlement may be preferable to jeopardizing future revenue and relationships.

When are settlement overtures most likely be fruitful?

Sometimes when business disputes are more likely to settle our number one before or shortly after a lawsuit is filed. These are typically cases in which the defendants liability is clear and the damages are modest. Alternatively, one or both parties may be eager to preserve their business relationship. If the defendant has insurance, the insurance adjuster may be willing to settle quickly.

Instance number two, before the discovery process begins settlement will avoid the considerable expense and time investment of answering interrogatories, locating and producing documents, and taking or attending depositions.

Number three, after the discovery process concludes when each side has a good idea of the others evidence and the attorneys can make an educated prediction about the outcome of a trial.

Number four, even on the eve of trial when facing the last chance to avoid the expenses and risks of trying the case before a jury, though most cases settle before trial settlement during or even after trial is possible.

For example, number five, after the plaintiff presents a strong case, when the defense anticipates a large verdict in the plaintiff’s favor.

Number six after a verdict to avoid the delay expense and uncertainty of an appeal.

Now most cases come down to a question of how much one side will pay and the other side will accept to avoid the risks of litigation. Some cases however, maybe worth pursuing the trial simply to cure an injustice or for other business strategic reasons. Although you may be initially eager for your day in court. You will make better decisions, if you view your case objectively as a juror would rather than as someone personally embroiled in the issue.


Getting Legal Help

Brown & Charbonneau, LLP represents individuals as well as large and small companies in cases involving all forms of business disputes, including fraud, breach of contract, breach of fiduciary duty, real estate, construction, employment and many other types of  disputes. If you are involved in a business dispute, or would like to learn about your options, rights and how to protect them, we can provide you with the information you need. Contact us or call today at 714-505-3000 to schedule a consultation and learn more about how we can help you.

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