Thinking Probabilistically

“Better ten years of negotiation than one day of war.” - Andrei Andreyevich Gromyko, Soviet Foreign Minister (1957 - 1985)

A party might settle early to avoid the risk of paying your costs of going to trial. They will pay something now to avoid that risk. In other words, they are paying you now for legal costs you have not yet incurred. It seems rather obvious once you run the numbers, but I think many people don't think of settlement negotiations in this way.