The Offer of Judgment rule is a United States tort reform law aimed at controlling unnecessary litigation and at encouraging settlement.
The penalties vary by state, but often include some combination of an award to the other party of certain attorneys' fees, compensable litigation costs and prejudgment interest.
In addition, the party who rejected the offer may lose their entitlement to certain attorneys' fees, compensable litigation costs and prejudgment interest.
In Georgia, the threshold was set such that the final court decision must be no more than 25% less favorable than the last settlement offer or the rejector becomes liable for attorney fees.
However, the Georgia Supreme Court struck the statute down in 2007, on the ground that it purported to act retroactively and was therefore unconstitutional.