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December 01, 2004

Companies Choosing to Settle More and More

The New York Law Journal reported on Tuesday that a pattern has emerged among companies with the recent crackdown on corporate misbehavior.  They wish to settle.

Attorneys say that, unlike individuals accused of wrongdoing, companies believe that a quick settlement allows them to rebound from the allegations quicker than long, publicized court battle does.  Even if lawyers think they have a strong case, companies are choosing to settle.  Not only does the market view litigation adversly, regardless of the outcome, but due to the crackdown on short leash the government has given companies, companies are more likely to lose battles that they may have won in the past.

Not only are companies choosing to settle more frequently, but they are choosing to do so at the earliest possible chance, many times, immediately followowing the filing of a complaint.  If a company chooses to not settle immediately, it risks indictment and certain bankruptcy. 

Posted by Matt Rutlin at 07:53 PM in Corporations | Permalink


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