If you’ve filed a personal injury lawsuit, there’s a good chance that at some point you’ll find yourself in a mandatory settlement conference (MSC). What is a mandatory settlement conference? The name itself is confusing. Does “mandatory” mean settlement is mandatory—that someone will force you to agree to a settlement? What happens at the conference? If your case doesn’t settle, do you get in trouble with the court?
We’ll do our best to de-mystify the MSC and answer some common questions. After reading this article, you’ll better understand:
- what a mandatory settlement conference is
- how to prepare for the conference
- what happens at the conference
- what to expect if your case doesn’t settle, and
- whether you should have a lawyer at the settlement conference
What Is a Mandatory Settlement Conference?
An MSC is an informal meeting between the parties to a personal injury lawsuit, their lawyers, and a neutral third party like a judge or a mediator. The purpose of an MSC is simple: To try to settle a lawsuit. The term “mandatory” means that the parties must attend the conference, not that the case must settle.
Who Must Attend an MSC?
As a rule, the court will require all parties and their lawyers to attend an MSC. If a business entity like a corporation is a party, a person who’s authorized to speak for the business must attend. Each party must have someone at the conference who is authorized to agree to a binding settlement, should the parties reach an agreement.
Most often these people will be present:
- the plaintiff (the injured party who filed the lawsuit)
- the defendant (the person or a representative of the business being sued), and
- if the defendant’s financial liability will be paid by insurance, an insurance company representative who’s authorized to agree to a settlement.
Typically, these people must be physically present at the conference. Sometimes, though, the court will allow attendance by phone.
Who Runs an MSC?
A neutral third party (who we’ll call a “mediator”) usually runs the MSC. The mediator might be a judge or it might be someone else who’s trained and experienced in mediating cases. For example, sometimes a retired judge agrees to serve as an MSC mediator. Other times, it might be a lawyer who has lots of mediation experience.
If a judge acts as the mediator, it probably won’t be the judge who’s assigned to hear the lawsuit. In federal court, for instance, settlement conferences typically are run by a magistrate judge, not by the district court judge who’s hearing the case.
What’s the Purpose of an MSC?
The purpose of an MSC is to encourage the parties to compromise so that the case settles. The goal is to resolve all issues between all parties in the case—a complete settlement. If a full settlement isn’t possible, the parties and their lawyers might try to resolve specific issues or parts of the case.
For example, maybe the parties can’t settle the whole case, but they agree that the plaintiff will drop a particular claim if the defendant agrees to drop a particular defense. Narrowing the issues this way might increase the chances that the parties can reach a full settlement later.
How an MSC Gets Ordered
Whether on the judge’s initiative or in response to a party’s request, an MSC happens because the court orders it. In most courts (federal and state), judges have the power to order an MSC on their own. The parties can ask the court to order an MSC, too. If the parties think there’s a chance the case might settle, the court will, in most circumstances, be happy to order an MSC.
Once the court orders an MSC, attendance is mandatory unless excused by the judge. If you fail to attend an MSC and don’t have a really good reason for not showing up, at the least you can expect to have an angry judge. At worst, the court might penalize you. For example, the judge might order you to pay the attorneys’ fees and expenses your opponent paid to prepare for and show up at the conference.
Preparing for the Settlement Conference
Preparation for an MSC depends on what the court rules require, what the mediator requests, and what will happen at the MSC. Most often, a week or two before the conference, each party (through their lawyer) submits an outline of their side of the case. The outline usually describes:
- the facts (the who, what, when, and where of the accident, the plaintiff’s injuries, and the plaintiff’s treatment and recovery)
- the parties’ claims and defenses
- any legal issues involved in the case, and
- if the parties have tried to negotiate a settlement, any demands and offers that have been made.
The lawyers typically attach to their outline any photographs, diagrams, reports, and other documents that they think will help their client’s case.
The plaintiff might get a chance to make a statement at the conference. The plaintiff’s lawyer should work carefully with the plaintiff on the statement, if the plaintiff chooses to speak. A rambling, argumentative, or emotion-laden rant will do more harm than good. The defendant and its insurer will be sizing up the plaintiff’s credibility and likeability, factors that can weigh heavily in settlement negotiations.
What Happens at a Settlement Conference?
What happens at an MSC depends on several factors, including the court rules and individual mediator practices. In general, though, look for the conference to follow a format something like this:
- the conference begins with the parties in the same room, where each lawyer gives a brief opening statement, and
- the mediator separates the parties into different rooms and then shuttles back and forth, trying to convince the parties to reach a compromise.
Starting the Conference
After brief introductions, the mediator normally asks each lawyer to make a short, non-argumentative opening statement. The opening statement will probably follow or summarize the outline each lawyer submitted ahead of the MSC.
It’s important that the lawyers (and if they’re allowed to speak, the parties) avoid argumentative rhetoric. The goal of the MSC is to settle the case. Settlement is less likely if the parties open the conference with heated arguments. As a rule, lawyers try to be polite and non-confrontational at the settlement conference, saving their sharp arguments for trial.
Once the lawyers’ opening statements are done, the mediator might ask if the plaintiff wants to say anything. If the plaintiff is represented by counsel, there’s no need to make a statement. If the plaintiff chooses to speak, they should keep these points in mind:
- the MSC isn’t the plaintiff’s chance to tell their side of the story
- the plaintiff’s statement should be factual, truthful, non-argumentative, and consistent with the opening statement made by their lawyer
- the plaintiff probably won’t say anything that will cause the insurance company to settle, and
- a poor showing might reduce the value of their case.
Separating the Parties: The Mediation Gets Underway
After the opening statements are finished, the mediator usually separates the parties and their lawyers. The plaintiff's team goes to one room and the defendant's team to another. The mediator then conducts “shuttle diplomacy,” working back and forth between the rooms to reduce the gap between the plaintiff’s settlement demand and the defendant’s settlement offer.
Once they’re separated, the mediator will speak to the parties frankly—and often quite bluntly—about their claims and defenses. Much of this discussion is for the benefit of the parties, not their lawyers. The lawyers almost certainly know (and have spoken to their respective clients about) the strengths and weaknesses of the case. The parties need to hear it from a neutral third party, someone who’s an outsider to the lawsuit.
The mediator also is likely to remind the parties that settlement is the best way they can control the outcome of the case. Lawyers and judges know how hard it can be to predict what a jury might do. And once the jury reaches a decision, it's probably one the parties will have to live with.
The MSC could take an hour or it could take all day, depending on how much progress the parties make toward a settlement. If discussions are going nowhere, the mediator won’t waste everyone's time and will end the conference. But if the parties are moving closer to each other, the mediator might keep going until a settlement is reached, or at least until clear progress has been made in that direction.
If the Case Settles at the MSC
If the parties agree to settle, the mediator will probably encourage them to put a draft of their agreement in writing right then and there. While they might need to work out a few details, the parties shouldn’t leave the MSC until they’ve reached an agreement on these points:
- the financial terms of the settlement, including what amounts will be paid, when, and to whom
- the scope of all releases to be signed
- whether the terms of the settlement must remain confidential
- when and how the lawsuit will be dismissed, and whether the court will be asked to retain control (in legal terms, “jurisdiction”) over the case for some period
- how the settlement will be enforced, and
- how the final settlement agreement will be documented.
This sounds like a lot of detail, and it is. But it’s important to hammer out these points at the MSC so that the settlement doesn’t fall apart later. Experienced personal injury lawyers are accustomed to negotiating these issues. Once the financial terms are agreed to, the remaining points should fall into place pretty quickly. The agreement prepared at the MSC doesn’t need to be perfect—just good enough to show that the parties reached a deal.
What If the Case Doesn’t Settle at the Conference?
If the case doesn’t settle at the MSC, it will continue to move forward to trial. But all isn’t necessarily lost just because the first MSC doesn’t produce a settlement. A case can settle at any time if the parties want to continue negotiations. Some lawsuits settle during (or even after) the trial.
The parties often agree to remain in communication with the court about their settlement efforts. If the court (or the parties) thinks that another MSC might be helpful, the court can order a second round of settlement talks. Judges are glad to see cases settle and won’t hesitate to order an MSC if the parties think it might bring them together.
Do I Need a Lawyer for a Mandatory Settlement Conference?
Can you handle an MSC on your own? Maybe. If your case isn’t complicated by difficult facts or legal issues and your injuries and damages are minor, you might be able to go it alone.
Should you handle an MSC by yourself? It’s rarely a good idea. If your case has made its way to a lawsuit and you still can’t reach a settlement with the insurance company, chances are it isn’t a simple case, or one that will be easy to settle.
The defendant and its insurer have experienced legal counsel on their side. The MSC might be your best opportunity to reach a settlement, or at least move the case toward a later settlement. In almost every case, your best chance at a good outcome will be if you’ve got an experienced lawyer working for you.
Here’s how to find a personal injury lawyer who’s right for you and your case.