5 Things to Consider Before Starting Business Litigaton

The 5 things you should know about business litigation

According to the Institute for the Advancement of the American Legal System, more than 100 million lawsuits are filed annually in the US. This is a massive number, and many of these lawsuits end in nothing more than legal and court fees. June is “Litigation Awareness Month,” so we’d like to give you a few things to consider before you decide to file a lawsuit to ensure maximum effectiveness for your time, effort, and money.

1) Will the lawsuit cost more than the recoverable damages?

This question is one of the most important to answer when determining if you will have an effective lawsuit. In our experience, many individuals are quick to want to “sue” someone, but often, the court costs and legal fees will far exceed the amount one might be rewarded by winning a lawsuit. Generally speaking, if the maximum amount you could be awarded by winning your lawsuit is less than $20,000, the up-front costs to bring a suit to bear, most attorneys will suggest mediation, arbitration, or a settlement offer rather than retaining a firm to complete a suit.

2) In a business litigation lawsuit, you should be prepared for a long-term battle.

Many business lawsuits happen between partners, executives, and shareholders; these individuals often have years of supporting documentation to help make their cases. Compiling, understanding, and presenting this information in a lawsuit can take countless hours.

3) Consider the strength of your case, and let your emotions balance out before you decide to proceed with your litigation.

In our business, we often encounter clients who are “angry suing” others (individuals and companies). It’s essential to take the time to evaluate your case’s strength before investing in the lawsuit. Are you just angry? Or were you genuinely wronged? Sometimes, the strength of your case is difficult to ascertain, so consulting with an attorney might be necessary before deciding to “take it to court.” In fact, if you speak with an attorney or firm that is willing to take your case right to court without a consultation to discuss potential outcomes and impact on you, it can be considered an ethics violation, and you should consider seeking consultation elsewhere.

4) Statute of Limitations—When did your issue occur?

In many cases, a crime or a slight against an individual can only be brought to prosecution within a limited time from the occurrence. White-collar crimes, for example, have only a 5-year statute of limitation federally, according to 18 U.S.C. § 3293(2). Some of these include securities violations, tax evasion, and falsifying federal documents. Statutes of limitations can vary considerably by crime, so it’s generally recommended that you check to see if you are within the allowable time to bring a case to court as one of the first steps before moving forward with litigation.

5) Will the defendant be able to pay if you are awarded a favorable judgment?

In business litigation, winning a case, sometimes, isn’t the end of the battle. A judgment must be payable by a losing defendant. The value of your case may be significantly impacted by a defendant’s ability to make their court-ordered recompense. With just a little investigation, your attorney can help compile a list of the defendant’s assets and whether you would be able to be awarded them should you win your case.

Discuss all these items with your attorney during your initial consultation to ensure your litigation is worth it. The business of litigation and suing is one of the largest in the United States. With more than 100,000,000 lawsuits filed each year, ensuring your litigation is worth it is more important than ever. Use these 5 rules to manage your business litigation and align your expectations with your desired results.

Michaelson Law Can Help

If you’re considering filing a lawsuit or have been named in one, Michaelson Law is here to help. With years of experience in litigation and a deep understanding of the legal landscape, we can guide you through the process, ensuring you make informed decisions every step of the way. Contact Michaelson Law today for a consultation, and let us help you navigate the complexities of your case.

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