The Strategic Use of Settlement Counsel: When is the Juice Worth the Squeeze?

Thu, Oct 2nd, 2025 | by Miles Mediation and Arbitration | Article | Social Share

By Edward A. Cohen

Settlement counsel, as the name implies, “is an attorney engaged for the express purpose of assisting a client to resolve a current dispute.” A settlement counsel’s task is to seek the best negotiated settlement for the client. While he or she must coordinate with the client’s trial counsel, the settlement counsel must also be separate and independent of the trial team.

However, who would need or want a “settlement counsel” when a company already has a trial counsel handling a pending lawsuit? After all, trial counsel are of course well-skilled and experienced at working cases up for trial, trying cases, and resolving cases. The answer is that for many matters, there is no reason to interrupt or undo this established norm of having trial counsel also be responsible for settling cases.

But the question is this: when can settlement counsel be a value-add proposition. Put differently, when is paying yet another lawyer to assist with a lawsuit an ultimate net positive for a company? The short answer is the lawyer’s favorite: it depends on the facts and circumstances. This article will explore the situations and factors in which settlement counsel may be merited.

The Benefits of Using Settlement Counsel

There are several advantages, in the correct situation, to engaging settlement counsel. One primary benefit of settlement counsel is that he or she can save precious time – specifically, when settlement counsel handles the settlement discussions so the trial counsel can remain appropriately engulfed in final trial preparations. If a straightforward case’s settlement hinges on two parties agreeing on a dollar amount (such as a slip-and-fall case in a grocery store with one plaintiff and one defendant), then a few phone calls during trial preparations – or even one day set aside just for mediation – should not unduly interrupt an experienced trial counsel’s overall trial readiness efforts.

In contrast, however, if the case and the settlement discussions are complex, the settlement negotiations and efforts can take substantial time. For example, consider the situation of settlement discussions commencing in earnest shortly before the beginning of a trial that involves substantial, but varying injuries to several plaintiffs along with more minor injuries to other plaintiffs – and on the defense side, two distinct alleged tortfeasor companies, both with multiple layers of insurance policies that may be implicated. Those settlement discussions will take time and energy. The client may want memoranda prepared to help analyze each new settlement scenario that one of the parties puts on the table. Such client-requested memoranda and analysis are eminently reasonable client requests, and this type of report is needed as fast as it can be prepared when the parties are in the middle of serious settlement discussions (especially if a trial is imminent).

Such settlement efforts take time – potentially a lot of time to do correctly. Does the lead trial lawyer (especially if he or she is the outside law firm’s relationship partner) have time to engage in intensive, complex settlement deliberations while also being responsible for putting together the last steps on trial preparations. And this does not even include the inevitable pre-trial last-minute activities, such as opposing counsel reaching out to work on stipulations or the trial judge wanting to get everyone on a Zoom to go over a issues arising from pre-trial motions that have not yet been decided. These are just examples of the last-minute pre-trial activities that can occur through no fault of trial counsel; but each of these pre-trial tasks must be ably performed. This takes time.

Time is precious for trial counsel, especially in that intense window leading up to the start of the trial. In appropriate circumstances, a separate settlement counsel can prevent the trial counsel from having to make a Hobson’s choice of not giving trial prep the time that was planned or not giving the nuances of a complex settlement negotiation its due.

A second potential benefit of settlement counsel is attitudinal or psychological. Some clients – and some trial counsel – want the trial attorney to exude his or her “game face” – and to be solely focused on winning at trial and presenting a “we are going to be successful at trial” attitude. To ask the trial counsel to maintain this tough-attorney demeanor, except for intermittent calls with opposing counsel to discuss settlement, may not be optimal for some counsel. Of course, many trial lawyers can switch between these distinct roles with aplomb but it may create a challenge for some counsel to perform both roles with peak efficiency. In the right circumstances, a settlement counsel can focus solely on settlement negotiations while allowing the trial counsel to focus on the trial.

Deciding Whether to Use Settlement Counsel

The decision on whether a settlement counsel makes economic and strategic sense is best made on a case-by-case basis, depending on the facts and circumstances including:

• Timing: how close to trial is the matter. (Will trial counsel be pulled away from crucial trial preparations to explore and negotiate a complex, time-consuming settlement; put bluntly, the question is whether effort put toward settlement discussions will negatively impact trial counsel’s trial preparations?)
• Are the parties’ trial counsel in the throes of contentious depositions or other pre-trial issues?
• How is the trial counsel’s relationship with opposing counsel (will strife between them potentially impact that openness that settlement negotiations can require)?

The strategic decision on whether a settlement counsel may be advantageous depends on several factors that, to an extent, can tip the scale for or against the decision to retain and utilize settlement counsel. The illustration below is intended to assist with this decision, by listing factors that can help tip the decision one way or another as to the use of a settlement counsel.

Settlement Counsel Appropriateness Grid

Less Justifiable                                                                                                                                       More Justifiable

There are several caveats worth mentioning. First, the above is based on anecdotal information acquired from personal experiences. Much of the discussion above – by design – sets forth the “easy case” for justifying the use of settlement counsel (i.e., utilizing settlement counsel for time-consuming complex discussions shortly before trial, when trial counsel really needs to focus on trial preparations). My view is admittedly informed by personal experiences in navigating the juxtaposition of both trial preparation and complex settlement discussions. But my views are also informed by my own experiences serving as separate settlement counsel, when my only focus was on efforts to resolve a pending dispute.

Consider the Potential Impact on the Client

Relative to many legal topics, there is not much written about the role of settlement counsel. However, several authors provide cogent explanations urging consideration of settlement counsel at early phases of a conflict – even before a lawsuit is filed. The gist of these authors’ position is that a business can save money (even with the cost of the additional counsel, namely the settlement counsel) if the settlement counsel can lead to a resolution before substantial legal fees are spent on litigation. The reasoning is that if a business wants to resolve litigation early in the process (and save expensive costs of litigation), then why wouldn’t it make sense to bring someone into the process early on who focuses on resolution.

Another question with use of settlement counsel is whether such counsel supplants the role of mediator or the role of in-house counsel. The answer is no, this should not occur. The settlement counsel should help the client (and the trial team) approach the mediation is way that increases the chances for a successful mediated resolution. The in-house counsel remains in charge of both the settlement counsel and the trial team, and is augmented, not supplanted.

A final caveat is that for trial counsel and settlement counsel to collectively benefit the client, they must cooperate while also staying in their respective lanes. Their cooperation will include the trial counsel briefing the settlement counsel on the case and its issues. A productive relationship between settlement and trial counsel will inure to the client’s benefit.

Settlement counsel obviously should not be utilized in every situation. However, the number of situations in which settlement counsel could prove beneficial may be much larger than many in-house and outside counsel have anticipated. Utilization of settlement counsel is worth re-consideration for the right situations.

*Originally published in Missouri In-House Counsel and reprinted with permission.

About Ed Cohen

Ed Cohen is a mediator who has spent most of his career focusing on a national litigation practice addressing and resolving complex lawsuits, most of which have involved environmental issues. He has been a partner at Thompson Coburn LLP for more than 30 years, splitting much of his time between St. Louis and Chicago offices.