When running a business, there are so many day-to-day responsibilities and to-do lists. Sometimes, it is easy to focus on the problems at hand and to avoid thinking about problems that don’t currently exist. However, every business owner should proactively prepare for being sued.
Litigation, like death, is an uncomfortable thought. This is why many business owners are caught unprepared when they find out they are facing a lawsuit. Let’s take a look at some important actions that business owners can take.
What should you do if threatened with business litigation?
If someone threatens your business with litigation, it is important to know how to respond. Crucial mistakes could make things more complicated and costly than necessary. Here are some steps to being proactive and prepared:
- Seek legal counsel: When facing a potential lawsuit, it is important to explore all your options with the guiding hand of a local law firm experienced in the type of matter you are facing. Finding the right lawyer can make a huge difference in how the matter proceeds.
- Organization: Now is the time to gather all documentation and evidence that could be pertinent to the case. Providing as much information as possible can help your legal counsel to develop a solid defense.
- Document Preservation. When you know you may be sued or are sued, it is imperative that all documents and communications relevant to the issues involved are preserved. Normal document retention/destruction policies should be stopped so that relevant information is not inadvertently deleted.
- Insurance companies: Many times, your insurance provider can provide a defense if you notify them and tender the claim to them. In the case of losing the lawsuit, the insurance company may be the one that pays rather than you, so now is the time to review coverage issues.
- Communication: Anything said outside of the attorney-client relationship within the company or on social media could negatively impact the case. It is often a good strategy to designate one person as the official spokesperson for the company to control communications.
According to the U.S. Census Bureau, there were 21,420 businesses in Hawai’i during 2019. Sadly, many of these will experience a lawsuit.
If you would like to proactively take the right steps when facing a potential lawsuit, it is imperative to have strong legal counsel that is experienced in litigation and disputes in Hawai’i. We have experience with litigation matters in many different areas and can probably help you.