Professional Liability

Batten Down The Hatches - Dealing With Business Lawsuits

September, 2016

By: Melinda M. Sanders and Kenneth H. Bayliss

Melinda SandersKenneth Bayliss

Most businesses will eventually be faced with some type of lawsuit. Here are basic tips to help you through the process:

Don't Ignore the Lawsuit Papers

If you receive a Summons and Complaint, you must respond, usually within 20 days. Failure to respond in a timely manner will lead to results you would rather avoid.

Don't Do Anything Foolish Upon Receiving Lawsuit Papers

Before anything else, take a deep breath and step back. Try not to react emotionally to the lawsuit. Understand that while litigation may be painful it's the best mechanism our society has for resolving many disputes. Do not contact the other party to vent your frustrations. Do not make any statements about the matter and get your attorney on the line quickly.

Hire an Attorney

Civil lawsuits have very technical processes and it is to your advantage to work with an attorney. Contact your business advice attorney and if he or she is not a litigator, seek a referral to an attorney who is. It is important to hire experienced attorneys, ones familiar with litigation and knowledgeable in assessing strategy and the value of your case.

Make Sure To Retain Relevant Evidence: The Litigation Hold

Once you know of a claim you will need to implement a "litigation hold." This preserves all evidence that may be relevant to the lawsuit, including documents, photographs, emails, texts, voicemails, and metadata. You may have a fantastic case, but if information in your control goes missing, the judge or jury may blame you for it and assume the worst.

Understand the Process

In very basic outline, here is the process you will go through during the lawsuit:

  • Answering the Complaint

You will work with your attorney to file an answer to the Complaint. If you have a potential claim against the other party, discuss it with your attorney at this time.

  • Initial Disclosures

Parties must automatically exchange basic information about the lawsuit. This includes information about key witnesses and documents, an itemization of damages, and insurance information.

  • Written Discovery and Depositions

Both sides are permitted to serve written questions on each other and request documents. This process, "discovery," also allows the parties to take depositions. Your attorney will be present and will prepare you in advance if you are deposed.

  • Mediation

Current rules require the parties to consider "Alternative Dispute Resolution" ("ADR"). In most cases this will be mediation, a non-binding process. Most cases settle at mediation or shortly thereafter. Sometimes it will be appropriate to try to mediate the case very early on.

  • Trial

When lawsuits are not resolved by motions or ADR, they are tried to a judge or a jury. Trials usually take place within approximately one year of the filing of the lawsuit, though there is considerable variation in the amount of time from filing to trial. Once the matter is tried-either to a judge or jury-a decision will be handed down. Parties generally have 60 days to appeal from the decision of the judge or jury.

  • Keep Your Eye on the Ball

During the lawsuit, make sure you focus on your business, and remember your business is not the lawsuit. Do not let the fear of what might end up on the expense side of the balance sheet cause you to ignore the revenue side. And almost as importantly, try to control your reaction to the lawsuit. Do not let it rule your life.

Abiding these few tips will help you better navigate the seas of litigation.

Source: https://issuu.com/businesscentral/docs/sept-oct_2016_issue_linked/44?e=2404155/38427314