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Under the new version of Rule 68(g), the sanctions against a party who fails to obtain a more favorable judgment than the offer is ?twenty percent of the difference between the amount of the offer and the amount of the final judgment.? This change applies to offers of judgment served on or after January 1, 2022.
As the name suggests, a Rule 68 Offer of Judgment is, in fact, an offer permitting a plaintiff to accept and enter a judgment against a defendant on specified terms, subject to the court's approval of the settlement via Rule 68.
Rule 68 is intended to encourage settlement and avoid protracted litigation. By accepting the defendant's offer, plaintiff agrees to end the litigation on all claims encompassed by his complaint against the offering defendant.
Rule 68 provides that the defendant may serve on plaintiff an offer of judgment at any point up to fourteen days before trial. In the offer, the defendant must state that it will allow a judgment to be taken against it for a specific sum of money or on other specific terms, along with costs then accrued.
- A party making a defendant's offer is offering something to settle their opponent's claim, counterclaim, additional claim, appeal, cross-appeal or costs assessment proceedings and to accept a liability to pay costs.
? At any time more than 10 days before the trial begins, a party defending against a claim may serve upon the adverse party an offer to allow judgment to be taken against him for the money or property or to the effect specified in his offer, with costs then accrued.
An offer of judgment is used to encourage settlements and protect parties willing to settle early in the litigation process. It is an extremely useful tool however there are important nuances to using this strategy successfully. Kenneth E. Pitcoff and Andrea M. Alonso, New York Law Journal.
A joint, unapportioned offer of judgment is an offer that involves either multiple plaintiffs or multiple defendants (or both), issuing or receiving an offer of judgment. The general rule is that joint, unapportioned offers of judgment are invalid.