Introduction
No business owner likes to think about litigation, but legal disputes are sometimes unavoidable in the corporate world. Whether it’s a breach of contract, partnership dispute, or intellectual property conflict, understanding what happens in a business litigation case is essential for protecting your business’s interests.
Step 1: Pre-Suit Investigation
The first step in any business litigation case is the pre-suit investigation. Before filing a lawsuit, your attorney will evaluate the facts of the case, gather evidence, and assess whether you have a strong claim. This phase is also critical if you are the defendant, as it helps identify potential defenses.
Example: Pre-Suit Investigation in a Breach of Contract Case
Scenario: A supplier failed to deliver goods to your company on time, causing financial losses. During the pre-suit investigation, your attorney will review the contract, emails, and delivery records to determine whether the supplier breached the agreement.
Step 2: Filing the Complaint
If the pre-suit investigation reveals a strong case, the plaintiff’s attorney files a complaint with the court. This document outlines:
- The legal claims (e.g., breach of contract, fraud, etc.)
- The facts supporting the claims
- The damages being sought
The defendant is then served with the complaint and has a specific period (typically 20-30 days) to respond.
Defendant’s Response
The defendant can:
- File an Answer: Responding to each allegation in the complaint.
- File a Motion to Dismiss: Arguing that the lawsuit should be thrown out due to lack of merit or jurisdiction.
Step 3: Discovery Phase
The discovery phase is often the longest and most critical part of business litigation. During this phase, both parties exchange information and gather evidence to build their cases.
Common Discovery Methods:
- Interrogatories: Written questions that must be answered under oath.
- Requests for Production: Requests for documents, emails, contracts, and other evidence.
- Depositions: Testimonies given under oath, recorded by a court reporter.
Example: Discovery in a Partnership Dispute
Scenario: Two business partners are in a dispute over financial mismanagement. During discovery, one partner’s attorney requests bank statements and accounting records to determine if funds were misused.
Step 4: Settlement Negotiations or Mediation
Before going to trial, many business litigation cases are resolved through settlement negotiations or mediation. Both parties may agree to a resolution to save time and legal expenses.
Benefits of Settlement
- Saves time and money
- Reduces the uncertainty of trial outcomes
- Preserves business relationships
Example: Mediation in a Vendor Dispute
Scenario: Your business sues a vendor for delivering defective products. During mediation, both parties agree to a settlement where the vendor refunds a portion of the payment and improves quality control procedures.
Step 5: Trial
If a settlement cannot be reached, the case proceeds to trial, where both sides present their evidence and arguments before a judge or jury. The trial involves:
- Opening Statements: Each side outlines their case.
- Presentation of Evidence: Witnesses testify, and documents are submitted as evidence.
- Closing Arguments: Final statements summarizing each party’s position.
- Verdict: The judge or jury delivers a decision.
Example: Trial in an Intellectual Property Case
Scenario: Your company sues a competitor for trademark infringement. At trial, your attorney presents evidence showing how the competitor’s logo is confusingly similar to your trademark, while the defendant argues the logos are distinct.
Step 6: Post-Trial Motions and Appeals
After the trial, the losing party may file post-trial motions or appeal the decision. Common post-trial actions include:
- Motion for a New Trial: Requesting a new trial based on procedural errors.
- Appeal: Challenging the trial court’s decision in a higher court.
Appeals can add months or years to the litigation process, so businesses should be prepared for a potentially lengthy resolution.
How can we assist?
Understanding the steps in a business litigation case can help business owners navigate legal disputes more effectively. From the pre-suit investigation to trial and appeals, every phase of litigation requires careful preparation and strategic decision-making.
Our attorneys have extensive experience guiding clients through business litigations. Our team includes a board-certified family law attorney, with advanced business degrees, and a specialist in negotiation and mediation. Contact us at 832-538-0833 to schedule a consultation and get personalized legal advice on your situation