Vent: Our company's approach to settlement changed after one case in 2023

We had a pretty standard policy of fighting every small claim to discourage more. Then, in early 2023, we got hit with a class action in California over some data handling stuff. The legal fees were over $200k before we even got to discovery, and the bad press was worse. After that, our general counsel started pushing for early mediation on anything with potential reputational risk. Now, we settle more often if the cost to fight is high, even if we think we could win. Has anyone else shifted their strategy because of a single expensive case?

2 comments

2 Comments

flores.tessa1mo ago

Absolutely. We had the same wake-up call last year. A single employee lawsuit in New York cost us nearly 150k in legal bills, and we won the case. The win felt empty because the money was gone and our team was stressed for months. Now our rule is simple: if the lawyer's first hour of work costs more than the settlement offer, we just pay it. Fighting on principle is a luxury we can't afford anymore.

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wright.drew1mo ago

That rule sounds like paying protection money to me. Settling every time just teaches people that a threat gets a payout. You have to draw a line somewhere or you'll get bled dry by small, bogus claims. The cost of always giving in adds up way more over time than fighting the really bad ones. Sometimes you have to spend money to show you won't be pushed around.