Originally posted by gofaster
Using the threat of a lawsuit to get money out of someone is extortion. The person filing a lawsuit never offers the deal. The only time the plaintiff pitches a settlement is when the plaintiff is a prosecutor in a criminal court trying to build a bigger case against another party. If the plaintiff wanted money, then he would file a legal claim for the amount he wanted. If he wanted to accept a lesser amount, then he would change his claim.
Its the defendant that offers the deal, and the plaintiff that accepts it or not. If he accepts the deal, he drops his claim against the defendant.
Perhaps it's a state by state thing. Here is how it works in PA (look at paragraph (b)):
Pennsylvania Consolidated Statutes
CRIMES AND OFFENSES (TITLE 18)
CHAPTER 39. THEFT AND RELATED OFFENSES
§ 3923. Theft by extortion.
(a) Offense defined.--A person is guilty of theft if he intentionally obtains or withholds property of another by threatening to:
commit another criminal offense;
accuse anyone of a criminal offense;
expose any secret tending to subject any person to hatred, contempt or ridicule;
take or withhold action as an official, or cause an official to take or withhold action;
bring about or continue a strike, boycott or other collective unofficial action, if the property is not demanded or received for the benefit of the group in whose interest the actor purports to act;
testify or provide information or withhold testimony or information with respect to the legal claim or defense of another; or
inflict any other harm which would not benefit the actor.
(b) Defenses.--It is a defense to prosecution based on paragraphs (a)(2), (a)(3) or (a)(4) of this section that the property obtained by threat of accusation, exposure, lawsuit or other invocation of official action was honestly claimed as restitution or indemnification for harm done in the circumstances to which such accusation, exposure, lawsuit or other official action relates, or as compensation for property or lawful services.