They don't want someone who will lose them money or threaten their reputation. But it is true that all physicians are at medicolegal risk, whether actual suits ever come to pass or not. You won't be rejected because you have lawsuits (unless there are so many that it means you're the problem). Your interviewer knows that suits are usually filed for initiating discovery to see if there is merit to a case. He or she will also know that the frivolous ones go away or prescribe. However, a settlement is looked upon just as unfavorably as a lawsuit you lose, because settlements are made to mitigate the damage of a likely unfavorable outcome.

So, what are you supposed to do you do if there are suits, losses, or settlements? 'Fess up, and because half of the story is your side, make sure you give it. Own it and don't blame your previous institution or group, because that looks bad. If you can explain why a lawsuit occurred due to a complication and not due to overt negligence, this is accepted as being part of the profession, so fear not.