No one ever wants to be in a lawsuit filed against them, but if your business ever grows to a certain point, it’s not an unlikely scenario. Even if the case is spurious, running an operation of any size means you still have to make sure you respect the legal process and also defend yourself as is appropriate.
There are many reasons this might be done – perhaps someone is accusing you of false advertising on spurious grounds, or an ex employee thinks you didn’t treat them correctly. Whatever it is, this post isn’t here to judge you at all. However, we do think that some friendly advice could potentially help you move forward and put this issue behind you.
In this post, we’ll discuss what to do if your business is involved in a lawsuit, outside of the obvious “lawyer up” advice which is so obvious, we likely don’t need to start with that:
Keep Your Documentation Organized
It’s crucially important that you gather all relevant files, emails, and communications related to the matter at hand. A thorough paper trail will help your legal counsel build a strong defense, and shows the court you’re serious about cooperating with discovery.
A disorganized approach will definitely cause delays and could make finding one critical document much harder. You shouldn’t wait until the last minute to put a system in place, even if the lawsuit seems laughable, as it’s recommended to have eDiscovery solutions or an internal process ready before any legal action starts. This means you can immediately submit your own motion or filing where appropriate to make certain you show you’re ready and present to fight the issue.
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Assign Team Members Who’ll Work With Your Legal Help
There ought to be a small group of people internally whose job it is to liaise directly with your attorneys. These individuals should possess a deep understanding of the business operations and be able to quickly locate requested documents or information, and also keep the matter private.
If you do find the right team, you’ll minimize disruptions to the rest of the company and streamline any communications with the outside legal team. You don’t want everybody getting involved in the legal process, of course, as it’s better if these contacts can keep your confidentiality and keep the flow of information in the right place.
Avoid Commenting Or Prejudicing The Case
Remember that it’s exceedingly vital to step back from discussing the ongoing lawsuit publicly, including on social media or in casual conversations with non-involved people. Anything you say could be used to prejudice your case or even harm your legal strategy, and that also goes if you’re speaking in confidence.
If you can, direct all media inquiries or questions about the case to your appointed legal counsel, who is trained to handle all manner of communications appropriately. It’s better to keep up your dignified silence throughout the process than to risk providing the opposing side with any unnecessary ammunition, which you can be certain they’ll use.
With this advice, we hope you can more easily cope even if your business is involved in a lawsuit.
Preserve Digital Communications Carefully If Your Business Is Involved In A Lawsuit
In the modern world of business, much of the communication of your company occurs on the digital plane in the form of emails, instant messages, videoconferencing, and cloud applications. In a case where your business is being sued, such digital footprints are extremely valuable evidence that may either make or break your case.
You will wish to do a litigation hold at once, which is a formal procedure that will guarantee none of the relevant electronic data is erased or modified. It covers all the emails and text messages, as well as backup files and archived documents, by the employees. Even unintentionally destroying evidence may result in harsh punishment and greatly harm your reputation when in court. Ensure your IT department is made aware of what should be saved, as well as the extent to which it should be saved, and they are given guidelines not to adopt normal deletion procedures on anything connected with the case.
It is also important to mention that the personal gadgets used in business can be required in this preservation process. In case staff members are used to transacting business of the company through their personal telephones or laptops, such communications can also be discovered.
Monitor Your Business Insurance Coverage
Most business is involved in a lawsuit; forget that they might have insurance policies that cover some kind of lawsuits. Your general liability insurance, professional liability coverage, and employment practices liability insurance may afford some financial coverage or even legal counsel to the claims being brought against you.
Immediately you get to know about the lawsuit, call your insurance company to know what is covered. There are certain policies that have to be notified within a particular period, and the inability to notify your insurer timely manner may put your coverage at risk. Your insurer can provide its own legal team or cooperate with attorneys of your choice in the defence.
Knowing what your insurance does and does not cover will help you in budgeting to spend on legal fees, and you will not be leaving money behind to cover your defence costs. This is more critical when, in such a case, your business is being sued, and the suit may take months or even years.
Maintain Normal Business Operations while Business Is Involved In A Lawsuit
As much as it is tempting to get engrossed in a lawsuit and put all your energies into it, you are supposed to keep your business running. Your employees, customers, and stakeholders continue to rely on you to produce products or services, and a lawsuit should not be used as an excuse to give poor performance.
Specific times can be closely assigned to address legal issues instead of letting them affect the whole day. Assign duties where necessary to ensure that the lawsuit does not hold up the key business decisions. It is important to keep in mind that showing that the business is still afloat can actually help you, actually. It will prove that your enterprise is not a failed affair, and it has the will and intention to do what should be done.
With that said, you should look over your business practices that relate to the lawsuit to make certain that you are not perpetuating possibly problematic behaviour. In case a lawsuit claims of some wrong act, liaise with your lawyers to make some adjustments that could solve those issues, which may prove that you are acting in good faith and may be considered as a strong point.
Consider Alternative Dispute Resolution
Litigation is so costly and time-consuming at times, taking years before it is concluded. Alternative dispute resolution, such as mediation or arbitration, could be the best option to use before getting into a legal tussle, particularly when your business is being sued, the results of which are still unknown.
Mediation is done by a neutral third party who assists the two parties to come into a mutually acceptable settlement, whereas arbitration is more formal yet comparatively quicker and cheaper than conventional litigation. The methods can save business relationships and give you more privacy than a court case at large.
Take steps on whether settlement negotiations or alternative resolution would be an idea based on the circumstances of your case; your legal counsel can advise you on this. At times reasonable settlement cannot be the most suitable business decision to make, even when you think that you have the right, when legal expenses, management time, and reputation are considered.
Learn From The Experience
Whatever happens to the lawsuit, use it as a chance to improve your business operations and avoid future lawsuits. Carry out an extensive analysis of the causes of the situation and introduce changes in the procedures, improve documentation practice, or enhance training programmes to accommodate any of the previously revealed weaknesses. Experiences that you can gain when your business is taken to court would be invaluable in creating a stronger business in the future.
