Toward a Theory of Motion Practice and Settlement

A model studies the relationship between pretrial dispositive motions, settlement, and discovery. The trial court, defendant, and plaintiff start uncertain about what the jury might think of the defendant's carelessness. The plaintiff is optimistic about her prospects at trial. The degree of optimism is private information. Discovery yields partial information that allows the parties to update their assessment of what the jury might decide if granted the opportunity (i.e., if the case does not settle). We find that settlement offers increase following the denial of the defendant's motion for summary judgment. We also study the impact of increasing the threshold of plausibility the plaintiff's complaint needs to survive the defendant's motion to dismiss.