Even when businesses work diligently to minimize the risk of ending up in court, there are situations when business litigation is unavoidable. Whether you are dealing with a breach of contract, intellectual property infringement, or real estate dispute, it is imperative to be proactive. Working with experienced counsel allows you to make informed decisions from the outset of the dispute and develop a legal strategy that protects your company's best interests.
Business litigation can take a variety of forms, including breach of contract cases, employment claims, intellectual property infringement, partnership disputes, business torts, and shareholder litigation. No matter the issue, legal disputes can be one of the most stressful parts of running a company.
Even in the best of circumstances, all commercial litigation involves a certain amount of risk and uncertainty. That's why more than 80% of all litigation ends in a settlement short of a jury verdict. In effect, most cases settle simply because neither the plaintiff nor the defendant can be sure how a jury or judge will respond to the arguments made by each side.
When navigating a business dispute, the biggest key to success is having a plan. An experienced litigation attorney can help you determine the central factual and legal issues, analyze the advantages and disadvantages of all available legal strategies, and determine which is most beneficial.
Options to Resolve a Contract Dispute
From delayed deliveries to quality concerns, contract disputes are a frequent source of business litigation. However, not every disagreement needs to result in a lawsuit. To avoid the stress, cost, and potential business damage that can result from litigation, negotiation should generally be the first step when seeking to resolve a contract dispute.
Negotiation isn't easy, particularly when each party thinks the other is in the wrong. It requires open and honest communication between the parties, with a focus on the facts of the dispute rather than emotions. Both sides must also be willing to work together in good faith to resolve. While negotiation requires compromises from both sides, it can often preserve the contract and your business relationship.
When informal negotiation is unsuccessful, businesses should consider alternative dispute resolution (ADR), which also allows contract parties the opportunity to resolve disputes outside the courtroom. ADR is almost always less costly and time-consuming than going to trial. This is particularly true for complex cases involving complicated issues and/or multiple parties.
The most common forms of ADR include mediation and arbitration. Mediation employs a neutral third party to aid in negotiating disputes and achieving settlements. The mediator's role is to facilitate agreements, not issue binding decisions, unlike judges or juries in disputes. Mediation may not fully resolve the case but often narrows remaining disputes, necessitating court resolution.
In arbitration, a neutral individual or group of individuals (either an arbitrator or an arbitration panel) is appointed to resolve the dispute. In some cases, the arbitrators are subject matter experts and, thus, may be more knowledgeable about complex areas of law, such as intellectual property, insurance, or securities law. While arbitration still involves hearings and document submissions, it generally proceeds more quickly than court proceedings. Unlike mediation, the arbitrator's decision is final and binding, so the parties must be willing to accept the outcome.
Deciding Whether to Settle Your Business Dispute
Choosing litigation doesn't guarantee a trial; many cases get resolved before reaching that stage. Settlement negotiations can take place at any point during the litigation process and may even be mandated by the court.
In determining whether settling is in your best interests, there are several factors to consider. To start, it is important to consider your resources. Settlement speeds up case resolution, saving time and money for all parties involved. A profitable company may be more inclined to invest in building and pursuing its case.
The settlement empowers parties to shape the agreement's terms,
including installment payments or asset exchanges. In contrast,
courts are generally constrained by statutes and legal
precedent.
Settlements often include confidentiality provisions, helping litigants avoid public scrutiny. By comparison, court documents are generally public records and may be accessed by the public.
Our Business Litigation Attorneys Can Help Resolve Complex Disputes
The members of Scarinci Hollenbeck's Commercial Litigation Group help entities of all sizes successfully resolve their most complex contract disputes. Working side by side with clients, we devise strategies that both protect their legal rights and advance their business goals. Our business litigators prioritize cost-effective strategies, utilizing negotiation, alternative dispute resolution, and, when required, efficient litigation. If you are facing a breach of contract claim or other business dispute, we encourage you to contact us today.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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