A settlement resolves a dispute only to the extent its document says so. The clauses that produce follow-on litigation are predictable.
Scope of release. Whose claims, against whom, arising from what, and up to when. A release limited to “claims asserted in this action” leaves everything else alive. A general release of all claims known and unknown is broader and in some jurisdictions requires specific language to reach unknown claims. Decide deliberately which you are buying.
Parties covered. Affiliates, officers, employees, successors and insurers are frequently intended and frequently omitted.
Confidentiality and non-disparagement. Whether either applies, whether it is mutual, what may be said if asked, and what the consequence of breach is. A confidentiality clause with no remedy is close to unenforceable in practice.
Payment mechanics. Amount, timing, method, and what happens on default — ideally an agreed judgment that can be entered on non-payment.
Tax treatment and reporting. Allocation between categories of damages affects withholding and reporting, and disputes about a missing or unexpected tax form are among the most common post-settlement fights.
No admission, and dismissal mechanics — with or without prejudice, and whether the court retains jurisdiction to enforce, which is the difference between a motion and a new lawsuit if the agreement is breached.