this is the topic of hours of MCLE lectures. A 998 is an offer to compromise the case for a certain dollar amount. The risks are that if you serve one and do not beat it you open yourself up to post offer costs. I think 998's are inherently risky and try to avoid them in most situations.
All respect intended, but a party who makes a 998 and fails to beat it is not then liable for the other side's costs. 998's are a one-way street. You can only be liable for costs if you reject one, never if you make one.
There can be significant consequences to failing to accept an offer to compromise and then not securing a judgment or award better than the offer. For plaintiffs who refuse a defendant’s offer and then either suffer a defense verdict or a judgment or award less than that offer, they do not recover their post-offer statutory costs normally allowed by CCP Sections 1032 and 1033.5, and they must pay the defendant’s same costs. Further, they may be required to pay the defendant’s “actually incurred and reasonably necessary” expert witness costs, including costs incurred pre-offer.1 For defendants who reject a plaintiff’s offer and then suffer a verdict or judgment in excess of the value of the offer, they may be required to pay the plaintiff’s statutory costs, as well as post-offer expert witness costs. In personal injury actions, defendants also will be liable for prejudgment interest.2
Well stated, and I agree. Perhaps I misunderstood your post but I was only responding to this statement: "The risks are that if you serve one and do not beat it you open yourself up to post offer costs." A party that fails to beat their own 998 does not, by virtue of the 998, open themselves up to costs. Perhaps costs can be obtained on other grounds, such as the grounds you describe above, but this does not have to do with the 998.
I appreciate the discussion.
no problem. 998's even this far into my career still can be intimidating.