Small Business Owner? You’ve Been Served: Next Steps After Receiving a Complaint.
There are many aspects of business cannot be controlled – not least of which are pandemics and lawsuits. Being served with a lawsuit is serious, and it can also be nerve-racking. Fortunately, knowing what to do and taking a proactive approach will help you get through it. Having an existing relationship with professionals like attorneys will also lessen the burden.
Although there are endless ways to “avoid” being sued, the fact is even when you do everything correctly, some may still bring a claim against you and your business. Be prepared.
1. Avoid Extreme Reactions of Panic and Indifference
DO NOT ignore the lawsuit and do not panic. Panic can lead to poor decisions and ignoring the lawsuit is a poor decision in and of itself. Do not react emotionally by contacting whoever is suing your business directly. Allow your lawyer to talk to their lawyer and handle everything on the record. If you are dealing with an employment-related issue where you still have to communicate with the person who is suing your business because they are an employee, you should avoid discussing the lawsuit and make sure someone is always there to witness your interactions.
2. Read the details of the lawsuit carefully
Pay attention to the important points: who, why, what, when. Who is suing you? What are they suing for and why do they feel the need to do so? When do you have to provide a response (Answer)? It will all be right there in the Complaint and knowing what you are faced with is the first step in getting the best outcome under the circumstances.
3. Contact a reputable attorney (if you do not already have one, as you should)
If you do not already have a working relationship with a reputable, experienced attorney, now is the time to start one. Even if you do not need their services yet, you can establish a relationship and get valuable insight on how to proceed if you are put in this position. Companies cannot appear in court without an attorney representative so for may, this is not optional.
4. Notify your insurance company if the suit involves an insurance claim
In some claims, insurance coverage will be implicated. This can be helpful because the insurance company might retain an attorney to defend the suit on your behalf. However, it is still important to consult an independent attorney to make sure that you are protected professionally and personally.
5. Determine how to move forward
Once you have taken the time to see what you are up against and talk to your lawyer about the best course of action, you will need to use this information to decide how your business is going to move forward with the lawsuit that has been filed. At times, it might be best to attempt to settle the claim without further litigation. In other circumstances, filing a strong defense or counterclaim will be most effective.
Honestly, if you can start with respect and mutual understanding, you may be able to avoid most of the potential lawsuits and other complaints from employees. But, even if a suit does happen, it’s not the end of the world. Use the information in this guide to help you get ready for any legal issues facing your small business.
Stay tuned for tips on What Not To Do When Served With A Lawsuit.
Cheers.
