Kristin Vana
January 1, 1970

Does settling a lawsuit admit I am wrong?

The Truth About Settling Lawsuits

Settling a lawsuit or coming to an agreement without going to court doesn’t mean you’re saying, “I did it.” You’re just finding a way to move on. Let’s clear up two big myths about settling lawsuits.

Misconceptions of Settlement

When you hear “settling,” you might picture yourself standing up and saying, “I admit it; I was wrong.” But that’s not the case. Settling is negotiating an agreement. It’s a way to solve a problem without a long and costly court battle. There are many reasons why businesses choose to settle.

Why Businesses Settle: Saving Resources

Going to court takes a lot of time, energy, and money. Small businesses like yours can’t afford to spend too much on legal battles. “Fast” lawsuits can take 12-18 months to reach trial. This is a long time of handling uncertainty.

The Benefit of Control: Avoiding Uncertainty

Court outcomes are unpredictable. Even if you believe you did nothing wrong, a judge or jury might see things differently. By settling, you get some control over the terms and the outcome.

Safeguarding Reputation Through Settlement

Sometimes, even lawsuit news can hurt your business. By settling, you can deal with the issue quietly and focus on your customers. Settlement agreements typically contain a non-disclosure clause that prevents the other side from sharing what you agreed to.

Dispelling the Myth of Increased Vulnerability

Some business owners worry that if they settle one lawsuit, they’ll have a target on their back. They fear others will think, “This business settles easily, so let’s sue them too.” But that’s not true. Each lawsuit is unique. Just because you settled one case doesn’t mean you’ll settle every time someone challenges you. Most of the time, the details of a settlement are private. That means other people won’t know why you settled or the agreement’s details. Business owners also fear that the attorney representing the consumer will ‘target them’ because the business settles - this is extremely rare. Believe it or not, most consumer attorneys have an overwhelming amount of business.

Navigating the Decision: Settle or Fight?

Deciding whether to settle a lawsuit is a personal decision. Each situation is unique. Here are some steps to help you decide:

Talk to a lawyer: An expert can guide you through the process, helping you understand the risks and benefits.

Think About Costs: Compare the costs of going to court versus settling. Often it is more economical to resolve the case at the beginning than it is to engage in litigation.

Consider Your Reputation: How will the lawsuit affect how customers see your business? Sometimes, settling is a way to protect your company’s good name.

Think About The Stress It Puts On You: Going through litigation is not for the faint of heart. It is extremely stressful and can take a toll on your mental health. It can also take a toll on your business as you spend more time away from making money to defend yourself.

Lawsuits as Challenges, Not Admissions of Guilt

As a small business owner, you know every day brings new challenges and you find ways to conquer those challenges. A lawsuit doesn’t necessarily mean you did something wrong, rather it is a new challenge. Whether you settle or go to court, trust yourself to choose the best path forward.