The comparison is not “settlement offer versus verdict potential”. It is the offer on the table against the expected value of trial — the range of outcomes discounted by the chance of each, minus the cost and delay of getting there.
The variables that get discounted
- Liability risk. A strong damages case with contested liability may still be worth less than a modest case with clear fault. In a modified comparative state, a few percentage points near the bar can mean the difference between a reduced award and nothing — see comparative and contributory negligence.
- The verdict range. Not the best case. The realistic spread on these facts, in this venue, before this kind of jury.
- Caps. A statutory ceiling puts a known limit on the upside — see state damage caps.
- Collectability. A verdict against a defendant with limited insurance and no assets can be worth less than a funded settlement. This is regularly the deciding factor and the one clients least expect.
- Cost and time. Trying a case adds expert and trial expense that comes out of the recovery, and appeals can add years.
Things that are not about the number
Certainty has real value to someone with medical bills now. Privacy matters: a trial is public, and cross-examination on your medical history, your finances and your social media is thorough. Some clients want the account on the record and an outcome named in open court, and that is a legitimate reason to try a case even when the arithmetic is neutral.
Health matters too. Litigation keeps an injury at the centre of someone’s life for years, and there is a genuine cost to that.
Why most cases settle
By the close of discovery both sides usually have similar information, so their expected-value estimates converge. Settlement happens in the overlap. Cases that do not settle are typically those where a genuine dispute remains — an unresolved causation question, a legal issue one side wants decided, or an insurer treating the claim as a test of a wider position.
Mechanics worth knowing
Mediation resolves a large share of cases and is non-binding, so nothing is lost by attending. Formal offer-of-judgment rules in many states shift costs onto a party who refuses an offer and then fails to beat it at trial — a real financial risk attached to declining. And the decision is always the client’s: counsel advises on value and risk, but only the client can accept or refuse.
Model the net, not the gross — see contingency fees and liens. Related: Trial, Settlements.
General information only, not legal advice.