In Everyone Imitates Art, Sam mentions that he has pizza boxes in his apartment... In this episode, he asks Tom to come over and prune his trees - something an apartment tenant wouldn't bother with.
Although the pretrial hearing purports to be in Massachusetts, the courthouse depicted in the cut scene is the New Orleans Parish Criminal District Court.
Diane admitted in the pretrial that Sam was not directly responsible for her injuries. Therefore, he did not have to propose "or risk going to jail". And the judge should have dismissed the case at that point.
After the pretrial hearing is dismissed, Diane admits to Sam that her injuries were fake and that the brace and cane she used in the courtroom were props. The state's prosecutor would not have taken the case to court without having had Diane examined to make sure she was really injured.