Participation rate measures acceptance among eligible claimants. Aggregate settlements typically require a minimum threshold before the defendant is bound, protecting against paying a fund while substantial claims remain.
Thresholds commonly range from eighty-five to ninety-five percent.
Alternative Names:
Opt-In Rate, Settlement Participation
Why it Matters?
The threshold is what makes an aggregate settlement worth funding, since resolution has no value to a defendant if a meaningful share of claimants opt out and continue litigating. Setting it high protects the defendant but risks the deal collapsing over a small number of holdouts. Walk-away provisions give the defendant the option rather than the obligation to proceed below the threshold, which is the standard structure.
Frequently Confused with
Related terms
Frequently asked questions
Why do settlements require a participation threshold?
What are typical thresholds?
