In the midst of a hectic day running your business, a person walks up to you and asks your name. Just as you answer him, he hands you a thick envelope and states, “You have been served!”
This scenario describes how many business owners first learn they are being sued. A local sheriff or a professional process server delivers court papers notifying a business owner that their business and perhaps, they personally, have been named in a lawsuit. It is not a particularly unusual scenario. Operating your business while defending your rights in court go hand-in-hand in today’s litigious society. As your business grows, so does the likelihood that you or your company will be named as a party to a lawsuit.
Whether your business is currently involved in a lawsuit or you wish to develop a plan for such a contingency, you owe it to yourself and to your company to take the time to gain the knowledge and form the relationships needed to protect your rights and interests. While there is no substitute for seeking legal counsel, this article will provide a primer for fortifying yourself against potential disputes. It will begin by laying out the immediate steps a principal should take once notified of a lawsuit. It will then go on to outline the key stages of a typical lawsuit and some alternatives to going to court that might be considered. When – not just how – to avail yourself of the courts to resolve disputes will also be considered. Last, the discussion will conclude by suggesting some next-step actions you can take in the event you do decide to seek judicial recourse. Hopefully, these steps will help to minimize some of the time and expense associated with full-scale litigation. (See PDF Figure 1 – Preparing Your Business for Commercial Litigation for a one page summary of the article’s key points)
Make no mistake: Defending your company’s rights in court is often a complicated and demanding process filled with many uncertainties. Educating yourself beforehand on what goes on during a business litigation and equipping yourself by partnering with an attorney who knows your affairs and can zealously defend your company’s interests are the first steps toward mitigating some of these risks and hardships.