How do lawyers decide how much to settle on during lawsuits? Please excuse my severe lack of knowledge in the world of law, as I am brand new, and am happy to edit my question should it not be correct in any fashion. This is a rather broad question. Suppose I am suing my employer for mistreatment at work (no lunch break, poor treatment, not fulfilling conditions of employment contract, etc.). How does my lawyer calculate a monetary amount on which to settle in the lawsuit? I saw a case recently of this variety, and the plaintiffs reached a settlement $1.3mil. How did the parties involved calculate $1.3mil exactly? I know this question is rather broad. I am not asking for the correct amount to ask for when suing someone, for that is subjective and different for each case. Rather, I am asking about the process. How do lawyers calculate how much to ask for in a lawsuit, and do they take into account just the prices of physical damage and money lost (e.g. damage to property, money lost from opportunities missed, etc.), or do they also factor in an amount to compensate for other factors? In the above example, I seriously doubt it cost a group of employees working for minimum wage $1.3mil to be mistreated at work, so how did they settle on $1.3mil?
Settlements are brought about by an analysis of the relevant litigation risks. To take a simple example, suppose both sets of lawyers agree that the plaintiff will likely collect about $2.6 million if s/he wins the lawsuit, and that the chances of prevailing are about 50-50. That would produce a settlement figure of $1.3 million (0.5 x $2.6 million). The main reason that settlements fail is because the two sides don't agree on the above parameters. For instance, if the defense felt that the plaintiff would be awarded no more than $1 million, it would not settle for $1.3 million. Or it may agree with $2.6 million as the potential liability figure, but feel that the plaintiff's chances of winning are only one in three.
Yes You asked for work to be done in the expectation you would have to pay for it and they did the work - that’s a legally binding contract. It appears that you did not agree on a price and possibly not on a time for making payment. If that is so, you agreed to pay a reasonable price in a reasonable time. They have issued an invoice stating what and when they believe is reasonable. You dispute parts of that invoice. That’s fine, people are allowed to have disputes. You have paid the undisputed amount I hope? Notwithstanding, your negotiations with the other party can go back and forth and things can be put on and taken off the table. But you don’t have a deal until you have a deal. At any time, either party can walk away and assert their rights. Or make a take it or leave it offer, commonly called playing hardball. Since it is undisputed that you owe them something, they can refer the debt to “collections (be that internal or an external debt collector). You should pay the undisputed amount immediately and you can continue to dispute the remainder. They will make a deal, initiate legal action, or let the matter die.
The amount requested has little or nothing to do with the amount, if any, eventually awarded. Once can sue "for 100 million dollars" and be awarded 100 dollars, and although it is rarer, one can be awarded more than the amount asked for when suit is field. That initial amount now serves as a peg to hang sensational news stores on, and nothing more. The plaintiff, and the plaintiff's lawyer, may consider that such publicity serves them well. Such inflated amounts are not grounds to dismiss the suit, so there is no downside to including them, except possibly negative publicity if people mock the demand.
If you sue a person for a tort X, one of the things you have to prove is that the defendant did do X. A baseless belief that it must have been so-and-so will do you no good. You do not have to have iron-clad evidence of your allegations, for a civil suit, but you have to show with a preponderance of evidence that the claim is true. A combination of "hates me" and "provably did this a number of times in the past" could well suffice. As for damages, it depends on what harm you actually suffered. If you get fired and you show that it was because of a false allegation, you would probably have to take this to the big court, since small claims court handles amounts in the $5,000 range (jurisdiction-specific).
united-states You may be confusing the right to an attorney if you cannot afford one that is applicable only in CRIMINAL cases, not civil cases like you are discussing. You may be able to get an attorney to take your case on a contingency basis but there are two things to keep in mind: The attorney has to have some expectation that the case is winnable. The amount to be recovered must be worth the risk of taking on this case. In other words, for the attorney it's more of a business question that a legal one. Many attorneys will give you a free 30 minute, more or less, consultation. Perhaps you might give that a try.
Meta Considerations I'm not aware of any such cases and I don't think that there are any, because if there was, the case would have generated more publicity around a &quot;glamorous&quot; issue in the law. Despite the fact that constitutional law makes it much easier to bring defamation cases when one is a private individual suing a non-media defendant in a matter of private concern, any search of the case law reveals that the defamation cases that actually get brought are those against media defendants and those involving matters of public concern. Private individuals rarely suffer enough harm to make it economical to bring a defamation suit, and people whose lives are not a matter of public concern rarely have deep pockets to hire attorneys to bring defamation lawsuits. Only Nominal Damages And No Attorneys' Fees Could Be Recovered First of all, even in a negligence per se case, where an award of nominal damages (i.e. $1 and court costs excluding attorneys' fees) is allowed as matter of law to the prevailing party, I don't think that an award of more than nominal damages would be upheld in the face of affirmative evidence that there was no actual harm to the reputation of the person defamed as a result of the publication of the defamatory statement. In defamation per se cases, nominal damages are awarded when &quot;there is no proof that serious harm has resulted from the defendant's attack upon the plaintiff's character and reputation&quot; or &quot;when they are the only damages claimed, and the action is brought for the purpose of vindicating the plaintiff's character by a verdict of a jury that establishes the falsity of the defamatory matter.&quot; RESTATEMENT (SECOND) OF TORTS § 620 cmt. a (1977). This would apply in a case of complete disbelief. Since the American rule applies to attorneys' fees in defamation cases, this would make every such suit an economic loser – which doesn't mean that someone might not act in an economically irrational way to defend their honor or something like that. Suing Increases The Harm Rather Than Mitigating It The publicity of a public trial undermines that approach in the kind of case in the hypothetical as well. Absent a lawsuit, there are one or two people who don't even believe it who heard the defamatory statement. But, if you bring a lawsuit, given the likelihood that the media will cover such a case, millions of people will hear the defamatory statement and they may very well believe those statements because they don't know any better. Even if you are ultimately vindicated at the conclusion of a trial, many people will have heard the defamatory statements after the suit is filed, but will never find out that you were vindicated many months later following a trial. Massively spreading defamatory statements about yourself that nobody would otherwise have heard about is just stupid as a matter of litigation tactics. The Presumption Of Harm To Reputation May Be Rebuttable Secondly, it isn't obvious to me that the presumption of harm to reputation in a negligence per se case is a conclusive presumption as opposed to a rebuttable presumption. For example, one can generally argue in a defamation case that someone's reputation before the defamatory statement was made is so irretrievably bad in the area related to the defamatory statement that it is impossible to damage someone's reputation any further, and so far as I know, that argument is not prohibited in negligence per se cases. For example, an intentionally false defamatory statement (which he can prove is false with an iron clad alibi and which the maker of the statement admits was made up at trial) that Ted Bundy once punched a prostitute in the nose giving her a black eye at the Moonbeam Bar at a particular date in the midst of Ted Bundy's serial killing spree, while constituting negligence per se might not state a claim for relief given that Ted Bundy's reputation for not being a violent criminal is already hopelessly tarnished by his multiple murder convictions for similar conduct. Milkovic Can Be Evaluated In Context Third, I am inclined to think that Milkovich v. Lorain Journal, 497 U.S. 1, one of the holdings is that &quot;statements that cannot reasonably be interpreted as stating actual facts about an individual are protected,&quot; together with cases such as the New York Times case reflect an evolving understanding in the law (quite distinct from the British concept of defamation which has a bit of an &quot;if you don't have something nice to say don't say anything at all&quot; to it), that defamation is simply a special kind of fraud claim in U.S. law, and that the tort of defamation is only constitutional in the United States because it is a form of fraud claim. If defamation is and must be merely a special kind of fraud, then the reliance element of a fraud claim is probably constitutionally required in a case where the existence or absence of reliance can be discerned as a matter of fact, without resorting to generalities as the court in Milkovich had to since the statement was published to a large number of people. It would not be unreasonable (and arguably constitutionally mandatory) to read a gloss on the &quot;statements that cannot reasonably be interpreted as stating actual facts about an individual are protected&quot; standard of Milkovich, to include an implied &quot;by the people to whom the statement was published&quot; clause, which would have one meaning when a large number of people in the general public heard it, and another in a context when only one or two people actually heard the statement, or when it was only heard by a group of people who would interpret it differently than the general public would. And, if so, that would be a complete defense and would not just reduce the claim to one limited to nominal damages. This is not a great stretch. For example, in California the words of an alleged libel must be considered &quot;according to the sense and meaning under all the circumstances attending the publication which such language may fairly be presumed to have conveyed to those to whom it was published.&quot; Macleod v. Tribune Publishing Co., 52 Cal.2d 536, 546-547; Selleck v. Globe International, Inc., 166 Cal.App.3d 1123, 1132. Libel Per Se No Longer Exists For Media Defendants Absent Actual Malice At one point it looked like the case Gertz v. Robert Welch, Inc., 481 U.S. 323, 349-350 (1974) might constitutionally eliminate libel per se, but this was premature. Gertz does not apply in cases involving matters of private concern to private individuals where the defendants are not media defendants. Dun &amp; Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 761 (1985) (where a defendant's speech concerned a private individual and a matter of private concern, states could allow plaintiffs to recover presumed and punitive damages even absent a showing of actual malice). But, Dun &amp; Bradstreet didn't address the question of whether the presumption of damages in a libel per se case was a conclusive presumption or a rebuttable one, because if it is a rebuttable presumption, then it could be overcome in the hypothetical of the question. And, it also doesn't address the question of whether the Milkovich analysis in a libel per se case must be context specific. In a case involving a media defendant and a private individual plaintiff the U.S. Supreme Court held in Gertz v. Robert Welch, Inc., 481 U.S. 323, 349-350 (1974) that: States may not permit recovery of presumed or punitive damages, at least when liability is not based on a showing of knowledge of falsity or reckless disregard for the truth. The common law of defamation is an oddity of tort law, for it allows recovery of purportedly compensatory damages without evidence of actual loss. Under the traditional rules pertaining to actions for libel, the existence of injury is presumed from the fact of publication. Juries may award substantial sums as compensation for supposed damage to reputation without any proof that such harm actually occurred. The largely uncontrolled discretion of juries to award damages where there is no loss unnecessarily compounds the potential of any system of liability for defamatory falsehood to inhibit the vigorous exercise of First Amendment freedoms. Additionally, the doctrine of presumed damages invites juries to punish unpopular opinion, rather than to compensate individuals for injury sustained by the publication of a false fact. More to the point, the States have no substantial interest in securing for plaintiffs such as this petitioner gratuitous awards of money damages far in excess of any actual injury. We would not, of course, invalidate state law simply because we doubt its wisdom, but here we are attempting to reconcile state law with a competing interest grounded in the constitutional command of the First Amendment. It is therefore appropriate to require that state remedies for defamatory falsehood reach no farther than is necessary to protect the legitimate interest involved. It is necessary to restrict defamation plaintiffs who do not prove knowledge of falsity or reckless disregard for the truth to compensation for actual injury. We need not define &quot;actual injury,&quot; as trial courts have wide experience in framing appropriate jury instructions in tort actions. Suffice it to say that actual injury is not limited to out-of-pocket loss. Indeed, the more customary types of actual harm inflicted by defamatory falsehood include impairment of reputation and standing in the community, personal humiliation, and mental anguish and suffering. Of course, juries must be limited by appropriate instructions, and all awards must be supported by competent evidence concerning the injury, although there need be no evidence which assigns an actual dollar value to the injury. We also find no justification for allowing awards of punitive damages against publishers and broadcasters held liable under state-defined standards of liability for defamation. In most jurisdictions jury discretion over the amounts awarded is limited only by the gentle rule that they not be excessive. Consequently, juries assess punitive damages in wholly unpredictable amounts bearing no necessary relation to the actual harm caused. And they remain free to use their discretion selectively to punish expressions of unpopular views. Like the doctrine of presumed damages, jury discretion to award punitive damages unnecessarily exacerbates the danger of media self-censorship, but, unlike the former rule, punitive damages are wholly irrelevant to the state interest that justifies a negligence standard for private defamation actions. They are not compensation for injury. Instead, they are private fines levied by civil juries to punish reprehensible conduct and to deter its future occurrence. In short, the private defamation plaintiff who establishes liability under a less demanding standard than that stated by New York Times may recover only such damages as are sufficient to compensate him for actual injury. See also Time, Inc. v. Firestone, 424 U.S. 448, 459 (1976). In the cases where it applies, Gertz requires proof of actual damages and bars the award of punitive damages, as a First Amendment requirement, and since actual damages are entirely absent in the case of the defendants in the question's hypothetical, if Gertz applied to them, they would not prevail. Now, Gertz in 1974 when it was decided, had limitations – it involved media defendants for whom actual malice could not be shown, but it did eliminate the public figure/public concern requirement. But, it isn't obvious to me that the Gertz limitations have not been expanded since then. Libel per se no longer exists in cases governed by Gertz (i.e. media defendants for whom there is no showing of actual malice). From v. Tallahassee Democrat, Inc., 400 So.2d 52 (Fla. App. 1981). Texas has expanded Gertz somewhat and held that even in cases where it does not apply, actual proof of actual damages is required to recover exemplary damages, even in libel per se cases where damages are presumed. Doubleday &amp; Co., Inc. v. Rogers, 674 S.W.2d 751, 755 (Tex. 1984).
How should I proceed? I am asking law friends to recommend some employment lawyers, but other than this, can I do anything else? You definitely don't need an employment lawyer for this. From a legal standpoint, the matter is very simple: If you grant their request (whether by signing or otherwise expressing your acceptance), you would be waiving any remedies currently available to you for their breach of contract. The company's attempt to override its contract with you is quite naive, but the company can always (and evidently does) try to get away with its liability nonetheless. I would not be surprised if the company subsequently tries harder to intimidate you, but that does not change your legal position &amp; merits unless you sign the waiver the company is pursuing. Asking for your post-termination availability reinforces the notion of company's poor planning and subpar management.
I'll answer out of order for a more logical presentation. Why would lawyers "leave the practice altogether", "[b]efore these lawyers lower their prices further they will"? Only about 30% of people earn a four year college degree. A lawyer is a college graduate who had to be in roughly the top 50% of his or her undergraduate class to be admitted to law school, so that puts him or her in the top 15% of academic ability. To actually finish law school and pass the bar exam, a lawyer has to be in roughly the top 12% of academic ability compared to the general public. Lawyers have strong reading and writing skills, reasonable communication skills, understand complex business and family matters, and are reasonably well organized compared to members of the general population. They also come with background checks completed in advance to weed out risks of criminal or otherwise dishonest or high risk employees. These are highly transferrable skill sets and a J.D. is a good substitute for an M.B.A. in many positions. Newly minted lawyers who choose to work in business management or a kindred field can typically secure middle management jobs in business and finance without much difficulty assuming that they weren't disbarred or had their licenses suspended for dishonorable reasons, or in a field related to their undergraduate major in college. So, if a lawyer can't earn a minimum compensation as a lawyer that rivals what the lawyer could earn in middle management, the lawyer will leave law and work in a non-legal post. Many lawyers do just that. And, indeed, since grant based financial aid is very rare for law school, most newly minted lawyers who aren't independently wealthy have huge student loan debts ($200,000 at the completion of an undergraduate degree and law school wouldn't be unusual), so if they want to avoid a default or an extremely long repayment period for a debt that can't be discharged in bankruptcy, they aren't free to accept a very low income even if they are willing to live modestly. The floor of what a lawyer can make in terms of compensation before having to seek better paying non-legal work is on the order of $40,000 to $60,000 of net compensation before taxes per year depending upon the local cost of living. In the long run, average legal incomes need to be even higher, because if too many people end up earning only marginal compensation, more potential lawyers will choose other career paths (e.g. as loan officers at banks, in insurance sales, in real estate brokerage work, as small business owners, as middle managers in big businesses, as H.R. officers, as financial analysts, as management consultants, etc.) which provide greater or similar returns with less student loan debt, fewer years of education, and less risk. Why can't fees be lowered "enough on individualized, bespoke services to meet the unmet need at an aﬀordable price"? Lawyers have bills to pay - a fully furnished and equipped office, at least a part-time per lawyer staff person, suits and dry cleaning, bar dues, and compensation for themselves (the floor on which was discussed above). But, providing "individualized, bespoke services", rather than mass producing services with a paralegal heavy practice (the way most debtor oriented consumer bankruptcy shops run, and the way prosecutor's offices and public defender's offices run), then it takes a lot of hours to provide those services. (The average prosecutors office has expenses of about $50 per felony case or less, not including law enforcement efforts to gather evidence and put the facts together coherently, and public defenders have even lower expenses per average felony case, perhaps $35 or less.) Even the most basic legal services (e.g. writing a simple will, defending a simple residential eviction or collection case or a DUI) takes 4-8 hours of lawyer time to accomplish, and you can't spend 100% of your time providing legal services either, as you have to devote some time to marketing, evaluating potential clients, supervising bookkeeping and administrative tasks, continuing education, etc. So, at most, a lawyer can handle at most about 200 very simple cases a year, or fewer cases that have any sophistication, and sometimes people don't pay their bills or don't pay on time. A 10%-25% bad debt rate would be pretty typical in small firm practice. Realistically, each lawyer needs about $90,000+ of gross collected revenues to cover expenses and make a floor compensation amount. So, a lawyer has to collect at least $500 to make a very modest living and just barely get by on a typical very small case provided at an extreme discount. A lawyer needs more like double that amount of gross revenues per very small case to make a decent living, and that all assumes that marketing efforts can reach enough people to keep the lawyer busy. If a lawyer's marketing or AR collection rates fall, fee collections per case have to rise. The trouble is that lots of people can't afford to pay a lawyer $500 to $1,000. This isn't affordable to them. Keep in mind that 40% of Americans don't have the ability to pay an unexpected $400 expense, and that the percentage is much higher in a place like Alabama or West Virginia. A $500-$1000 legal fee expense for even a very simple matter is something that most people with "unmet legal needs" simply cannot afford to pay no matter how badly they need those services. These are the people with "unmet legal needs", and the cases they face are often cases like defenses of criminal charges likely to result in some sort of conviction, or no asset bankruptcies, or defenses of foreclosure or eviction or collection cases, non-employment related immigration cases, or child custody cases, or defense child support collection actions, in which case there is no significant pot of money from which fees can be paid, even if a lawyer's client wins. (In cases where there is a significant potential "pot of money" like money owed for work done or a personal injury case, legal needs usually are met.) Also, while lots of Americans can't afford even a $400 legal bill, there is a pretty significant group of businesses and upper middle class and wealthy individuals who can afford to pay tens of thousands or hundreds of thousands of dollars per legal matter, and for whom a lawyer can provide value added to the client even at that price. For example, businesses and landlords that need commercial leases to be negotiated, documentation of and negotiation of multi-million dollar business financing deals, tax planning for a complex conglomerate, personal injury litigation in cases with clear liability and serious injuries, business disputes, representation of clients in connection with the bankruptcies of medium and large businesses, employment litigation, white collar crime defense, etc. This kind of work requires a lawyer's marketing effort to be much more modest and dramatically reduces the time spent evaluating new cases. A lawyer may need only five or ten cases like that per year instead of 200 small potatoes cases, while earning much better compensation. So, the legal needs of those who can afford to pay are met, and the legal needs of people who can't afford to pay lawyers at any fee that a lawyer can break even at (realistically closer to $125-$175 per billable hour after bad debt and time generating work and idle time until new clients are secured is considered), and who don't have economic circumstances from which legal fees can be extracted in their cases, go unmet. Until such time as legal work can be provided with fewer attorney hours, or by someone who has less well paying alternatives to practicing law, and with less expensive educations, it will remain this way indefinitely without some sort of subsidy or insurance coverage. Also, keep in mind that practicing law provides an irregular income in small firm practice due to irregular payment timing and ebbs and flows of new clients, so to keep to any reasonable set of fixed living and overhead costs paid, a lawyer must have months that generate much more than the lawyer's "monthly nut" in order to generate savings for lean months. Finally, a lot of the very low paid lawyers are retirees, part-time employees who are also homemakers, are people moonlighting as lawyers in addition to another job, or are charitably inclined independently wealthy people. So, they have additional sources of income and aren't supporting themselves from full time work as lawyers. These are the only people who can afford to work as lawyers for lower amounts of income per year. But, even then, independently wealthy people normally have the best access through social and family networks to people who have an ability to pay them to work on high dollar matters, so they normally end up in high paying jobs where their "rain making" capacity is part of why they are paid so well, rather than giving their services away on a charitable basis. Observation An important corollary of this analysis is that the problem of unmet legal need cannot be solved simply by producing more lawyers, because if you produce more lawyers and all legal need capable of paying for the work is met, the new lawyers will simply pursue non-legal careers.