Business Litigation 101
WHAT TO DO IF YOUR BUSINESS IS SUED
Legal conflicts can arise for any business in any industry. It’s natural to feel stressed when faced with the uncertainty and disruption of a lawsuit, but responding strategically rather than reacting emotionally will help you better manage the situation. Immediate Steps Your first step is to review the complaint thoroughly. Examine the lawsuit documents to understand the claims and verify important details, such as your company name, the court jurisdictions, and the deadline for a response. Ensure the claims pertain to your operations and that the plaintiff has named the correct parties. Use this information to prepare a lawsuit summary, but consult an experienced business litigation attorney to develop a defense strategy. Also, check with your insurance broker or internal insurance teams to see if the company’s policies cover any of the allegations. If so, they can be used to pay for legal defense and potential settlements. Internal Preparation Internally, secure documents related to the case, including emails, contracts, financial statements, and internal communications. Acting quickly to implement a litigation hold will prevent the accidental destruction or deletion of key documents. Instruct employees to limit internal and external discussions regarding the case. Designating a specific point of contact — ideally your attorney — to handle all legal inquiries and media requests is also advisable. Legal Proceedings and Expectations Your attorney will help you decide how to respond to the claims, whether admitting to the actions and paying the claim, negotiating a settlement, filing a defense, or countersuing the plaintiff. Many business lawsuits do not go to trial but are resolved
Building a business can mean long hours spent growing sales, putting out fires, and driving ideas to fruition. Checking your business credit score might not be the first thing that comes to mind as you start your work day, but it can make a significant difference in your ability to accomplish all those other goals. A lack of proven creditworthiness will inflate your borrowing costs and insurance premiums and harm your ability to attract strong business partners and vendors. Here are three common oversights that can put a serious dent in your business credit score and tips on avoiding them. Failing to Monitor Your Credit Check your score frequently with each of the three business credit rating agencies — Dun & Bradstreet, Equifax, and Experian. Look at what is included in your score, whether your business information is up to date, and whether your creditworthiness is weak in any areas. These agencies, Nav, and other services can monitor your credit score and ping you if it changes, alerting you to identity theft or other fraud before your losses mount. Free credit monitoring is available, but you’ll pay a small fee to get a complete look at your score. Every time you check, verify your business’s revenue figures and industry classification. Errors in these areas can hurt your ability to borrow. If your credit report misclassifies you as a “real estate investment BUILD YOUR BUSINESS MUSCLES To Protect Your Credit Score
through mediation or settlement agreements. However, if litigation proceeds, your attorney will help build a strong defense and guide you through the legal process. Mitigating Future Risks Litigation can be very disruptive to your business. You can mitigate the risk of legal conflicts by reviewing contracts and compliance policies and implementing alternative dispute resolution clauses in agreements. Ensuring you have the correct type of business insurance can also help you cover many lawsuit claims. If you face legal action, Sul Lee Law Firm will provide expert guidance to defend your business. Our team handles various cases, including
firm” rather than a real estate broker, for example, lenders and other businesses will deem you a riskier business partner. Additionally, mixups happen more easily with business credit scores than personal ones because identifying information is indexed only to your
business name and address. If your DBA is similar to another company’s, your business might be confused with theirs, and their financial management mistakes may end up on your report. Build a regular credit report review into your monthly routine to avoid these risks. Slow-Paying Your Bills The clock runs faster on business credit than on personal loans. While consumer debt typically isn’t treated as late until 30 days
partnership and shareholder disputes, breach of fiduciary duty, fraud, and employment disputes. Contact us today to explore your legal options.
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