When a judge or a jury decides the outcome of a lawsuit, a “verdict” is reached. A “settlement” is reached when the plaintiff and the defendant voluntary reach an agreement to resolve the lawsuit.
The two parties (plaintiff and defendant) may decide to settle a lawsuit at any time after the case is filed. If negotiations do not produce settlement terms that both sides agree upon, the case will proceed to trial. At that point, a judge or a jury will hear arguments from the two parties and decide, based upon available facts and evidence, which party is in the right. Even after a case proceeds to trial, however, a settlement can still be reached prior to the court’s final judgment.
In cases where the judge/jury reaches a verdict in favor of the plaintiff, the court additionally determines the amount of compensation that the defendant must pay the plaintiff, based on the plaintiff’s losses (i.e. medical bills, lost wages, and pain and suffering).