It’s stylish to bemoan how few cases go to trial these days—and for first chair litigators (and the reporters who write about them) it’s a bit anticlimactic when litigation gets resolved behind closed doors.
But to SettlementAnalytics, trials are basically a failure. Going to court means the “economic forces that ordinarily encourage a negotiated solution” broke down.
So how is the “Litigation Settlement Failure Index” supposed to work?
There is “an economic signature to the subset of disputes which can be expected to end up in a courtroom,” Robert Parnell, president and CEO of SettlementAnalytics, said in a news release. “By analyzing the economic structure of legal conflicts we can extract the implied probability of settlement failure.”
The company points to the theory of divergent expectations, which suggests that some cases don’t settle because of “excessive mutual optimism” about the outcome on both sides.
