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Responding to a lawsuit: Three critical tips for business owners

On Behalf of | Aug 28, 2020 | Business and Corporate |

A lawsuit is something no business owner wants to face, but it is a frequent risk in the business world. Whether they face a premises liability lawsuit or a breach of contract claim, small business owners must be consciously aware of all the nuances and details involved in the lawsuit before moving forward.

One critical detail business owners should not overlook is how to properly respond to a lawsuit without putting their business at even more risk.

What to do before responding to a lawsuit

Unfortunately, it is unrealistic to think that one’s business will never have to deal with a legal complaint or litigation. These situations are unpredictable, so one strategy will not fit all circumstances. However, it is still critical for business owners to understand how they should approach a legal claim.

When first faced with a lawsuit, several sources agree that business owners must not ignore the lawsuit. They must address it and respond to it promptly, but there are a few steps to take first:

  1. Remain calm: Panic is a natural response, especially when a lawsuit places one’s dream at risk. However, it is critical not to let panic control the situation. Acting out of emotion could lead business owners to make miscalculated decisions or mistakes, which will not help to protect their business.
  2. Read the complaint carefully: Business owners must ensure they obtain all the facts. Forbes recommends that business owners review the complaint closely to determine who filed the complaint, the reason it was filed and other pertinent information. This allows business owners to respond effectively to the lawsuit.
  3. Get advice: When dealing with a lawsuit, business owners should contact an experienced business attorney as soon as possible. An attorney can help business owners evaluate the liabilities they face, determine how to move forward as well as craft a response to the lawsuit.

A lawsuit always poses a risk, but business owners can mitigate that risk if they respond to the claim properly and build strategies to protect their business.