Why Settle before Trial?
The uncertainty inherent in the jury system encourages these settlements because both sides realize that although they may win more than the settlement provides, they can also lose everything. In some cases, innocent defendants, both civil and criminal, settle or accept a plea bargain because they believe that jury prejudice will make it impossible to get a fair trial. This happens both to poor members of disadvantaged groups who fear racial or ethnic prejudice, and to large corporations that fear that juries will disregard scientific evidence in favor of emotion, especially in cases that involve difficult issues of statistical proof, such as the breast implant cases or environmental toxin cases.
Cases go to trial when either or both parties would rather risk a loss than take a settlement on the terms available. Physicians accused of criminal Medicare fraud often fight, even when their chances of winning are very low, because a plea will cost them their medical license and the right to work in medical care. Conversely, institutions charged with Medicare fraud usually settle because the government sets the fine they must pay low enough so they will not go out of business, but the mandatory fines that accompany a guilty verdict will bankrupt them. The reporting requirements of the National Practitioner Databank discourage settlements in medical malpractice cases because the settlements cannot be made confidential.