- 1 Signs You Are Headed for Business Litigation
- 2 The Common Types of Business Litigation
- 3 5. Personal Injury Claims
- 4 Prepare for Business Litigation
Although business disputes are heavily frowned upon, they often do happen.
They can arise due to some reasons and can happen with anyone, like suppliers, customers, employees or a business partner.
Seeing as they replace the time for running the business by handling the dispute, business disputes can be costly.
However, when a dispute worsens, usually one, or both, of the involved parties will hire a lawyer.
The dispute then becomes a business litigation, since a lawsuit is involved.
Depending on the type of business litigation, there will be an appropriate solution to maximize results and minimize costs.
That said, Here is a breakdown of all things business litigation and the process of dealing with them:
Signs You Are Headed for Business Litigation
Sometimes, business disputes are just disputes that resolve themselves over time.
However, sometimes a dispute can take a turn for the worse, and you may find yourself headed for litigation.
Although reading the signs and spotting impending litigation is not easy, it is not impossible either.
Here are the signs you need to know about.
1. Communication Breakdown
A dispute usually begins with two parties arguing.
However, the moment they stop arguing and start to cut off communication, that is when you should start to worry.
This usually means that the party that is pulling back is preparing for litigation.
2. Talking with the Lawyer
One of the more conspicuous signs involves having one of the parties direct all discussions to their lawyer.
This will likely mean that they are preparing to head for litigation.
And though it can be worrisome, it does not always escalate.
Sometimes, the lawyers can act as reasonable intermediaries and settle the dispute without involving a lawsuit.
This is because lawsuits can leave permanent damage behind.
3. No One is Compromising
When neither parties are compromising, it is usually a sign that presages a legal dispute.
This is a popular sign that must not be overlooked.
4. Poorly Drafted Contract
Although this is more of a cause and less of a sign, some parties will take advantage of a poorly drafted contract and get away with a violation.
Disputes that begin with a poorly drafted contract usually escalate quickly and tend to head for litigation.
The Common Types of Business Litigation
There are many types of business litigation disputes, however, here are some of the most common.
1. Intellectual Property Disputes
Oftentimes, disputes will arise because of intellectual property theft.
Seeing as your intellectual property belongs to you, other people are not allowed to use it without your permission.
If someone does, usually, disputes are not that far behind. You can sue the person and prevent them from releasing trade secrets.
If your intellectual property rights were violated, you may seek damages.
2. Employment Disputes
A lot of companies will have their employees bound by contracts and agreements, such as a non-disclosure agreement.
Should an employee violate the agreement an employment dispute will usually arise.
Other reasons that lead to employment disputes are discrimination, harassment, and wrongful violation.
People that allow co-workers to create a hostile environment are not exempt.
3. Breach of Contract
This is perhaps one of the most common types of legal disputes.
When a party or two parties agree, they will usually sign a contract which they must not violate.
However, a breach will enable the damaged party to seek compensation for the losses.
It is common to have business partners disagree.
However, should the situation aggravate, and either member remains resolute on being inflexible, a lawsuit may arise.
5. Personal Injury Claims
Personal injury claims are one of the most predictable disputes that businesses suffer from.
Sometimes the claim is valid, while other times the allegations could be a hoax.
Still, if a person claims to have been injured by a company’s product or at their workplace, they can sue the company for damages.
6. Debt Collection
Many business litigation disputes are debt-related and will involve business-to-business collection.
A lot of these cases will quickly involve business litigation attorneys since they can secure the transaction and make it easier for the business to focus on day-to-day operations.
At first, attorneys may exercise arbitrary methods, however, should the dispute prolong the attorneys may file a lawsuit.
Prepare for Business Litigation
Since lawsuits can permanently harm a business’s reputation, most businesses will not confront oncoming litigation until the dispute is officially made into a legal one.
However, it is important to take the appropriate measures to protect yourself.
For this reason, if a legal dispute is in the making, it is important to immediately consult a lawyer.
The lawyer will provide legal advice that you are expected to act upon.
Once you have received your lawyer’s advice, you will need to review the organization’s practices with your lawyer.
They will be able to tell you which areas are vulnerable and need strengthening.
If you are unprepared for the litigation you may find yourself at a disadvantage and can end up losing the lawsuit.
When you are being faced with a legal dispute, it is always best to settle out of court.
This is especially true for businesses that have the hope of preserving their image and enforcing damage control.
The reasons are that trial can be expensive, as you will likely hire a legal team and fund their findings.
Though a settlement fee may exceed the expenses of trial, they can end up saving you a lot more in the long run.
Your aim should be to avoid permanent damage at all costs.
Business litigations are very complicated and can take years to settle, especially if the matter is taken to court.
They can leave behind unspeakable damage, some being permanent.
Since the types of business litigation are many, it is easy for a business to fall into it.
Sometimes, filing a lawsuit will be necessary, like with matters of copyright infringement and debt collection, both of which escalate quickly.
However, it is best to look for a solution outside of the courtroom, since the matter can exhaust a lot of resources and take up years to be done.