A Case Study Approach for the Litigation Decision: Employing Decision Analysis to Determine When a Business Should Settle or Go to Court

Abstract

For a business, exposure to a lawsuit represents substantial costs. Although the court costs and attorneys’ fees are obvious expenses, the business manager must face the additional costs litigation imposes upon a business. For example, such costs include the amount of time company employees will be required to spend in preparation for the suit through their testimony or through the furnishing of documentary evidence. Also, there are the costs to the business in the form of damage to the business reputation. To date, no organized method of cost analysis has been developed for use by the manager or the business student in a case study. In this paper, such a revolutionary model is introduced.