California Supreme Court Green-Lights "Choose Your Own Settlement" Offers

kestner Law
Aug 9
3 min read

What Happened

On August 6, 2026, the California Supreme Court handed down a ruling that changes how settlement offers work in civil lawsuits across the state. The case is Gorobets v. Jaguar Land Rover North America, LLC, and it answers a question that's been quietly dividing lower courts: can one settlement offer give the other side two different deals to choose from?

The short answer, according to the Court: yes — as long as the offer is clear and at least one of the choices has a real, calculable price tag.

The Backstory

Vadim Gorobets leased a 2016 Land Rover that turned out to be a lemon — steering, brakes, engine, electrical, you name it, all broken and never properly fixed. He sued under California's Song-Beverly Consumer Warranty Act (the state's "lemon law").

During the case, Jaguar Land Rover made a settlement offer under Code of Civil Procedure section 998 — a special kind of offer that comes with a financial penalty attached if the other side turns it down and then does worse at trial. This particular offer gave Gorobets two options to pick from:

Option A: A simple lump-sum payment of $85,000 for the car.
Option B: A more complicated deal where the company would reimburse Gorobets for specific itemized expenses, with a built-in process to resolve any disagreements over the amounts.

Gorobets didn't pick either one. He let the offer expire and kept litigating. At trial, the jury awarded him about $76,155 — less than the $85,000 he'd been offered.

Why This Ended Up at the Supreme Court

Because Gorobets didn't beat the $85,000 offer, the trial court penalized him: he lost his right to recover his costs and attorney's fees incurred after the offer, and had to pay some of the company's costs instead.

Gorobets fought back with a clever argument: he said the offer itself was invalid because it gave him two things to choose between instead of one clear number. He argued that this kind of "pick a lane" offer is too confusing and uncertain to count under section 998.

The Court of Appeal actually agreed with him — at least in theory. It ruled that offering someone a choice between two settlement packages is never valid under section 998, calling it inherently too uncertain. (It still upheld the penalty against Gorobets on a technicality, but the "no-choice-offers-allowed" rule was the headline.)

What the Supreme Court Decided

The Supreme Court disagreed with that blanket rule. It held that a "menu style" settlement offer can be valid, so long as two things are true:

The offer is clearly structured. The person receiving it has to be able to tell exactly what each option involves and understand that they must pick one — not mix and match pieces from both.
At least one option has a clear price tag. At least one of the choices needs to be specific enough that both sides — and later, a judge — can figure out what it was worth at the time it was made.

Since the $85,000 lump-sum option in this case was simple and easy to value, it counted. Gorobets' jury verdict didn't beat it, so the cost penalty against him was upheld.

Why This Matters

Before this ruling, offering a defendant or plaintiff a choice between settlement packages was a legal gray area — some lawyers avoided it entirely for fear a judge would later toss the whole offer out. Now, the rules are much clearer:

Settling parties have more flexibility. Lawyers can now offer real alternatives — for example, "take a flat payment" or "get reimbursed itemized expenses" — in a single offer, rather than sending them one at a time.
It encourages faster settlements. The Court reasoned that giving people more realistic options up front helps resolve cases earlier, which saves everyone time and money.
But offers still have to be clean. Vague, overly complicated, or "trick" offers designed to confuse the other side can still be thrown out — either for lacking clarity or for not being made in good faith.
The penalty still bites. If you reject a valid offer (or let it expire) and don't do better at trial, you can still be on the hook for the other side's costs — even if the offer you rejected had multiple options.

The Bottom Line

You can now build flexibility into a settlement offer without automatically losing your ability to use it as a strategic tool. But the offer still needs to be clear, fair, and priceable — courts aren't going to reward confusing or gimmicky offers just because this ruling opened the door to choices.

This post summarizes Gorobets v. Jaguar Land Rover North America, LLC, S287946 (Cal. Aug. 6, 2026), for general informational purposes. It is not legal advice. If you're facing a settlement decision in a California lawsuit, consult an attorney about how this ruling applies to your specific situation.