Who pays out?

I've heard that the show will pay out the lawsuit or the countersuit - is that correct? Maybe my brain isn't braining, but that doesn't make sense to me as to why. Will the show then request the payment from the opposing party later? Was it always that the show paid out? And if the showed paid out, wouldn't that entice people to just go on the show to try and get "free money"? (I do remember a case where JJ sensed a "scam" and dismissed the case). Anyway, if someone knows the logistics of it, I'd love to be educated. Thanks!