Why And How To Avoid Costly Business Litigation Issues

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A lawsuit is something most business owners will do their best to avoid. Unfortunately, even a seemingly minor issue can plunge you into a world of business litigation troubles if handled incorrectly. This is why it’s critical to be aware of your options and know which to pursue to protect yourself and your company.

The following post paints a clear picture of the reasons you should avoid business litigation when possible:

Tips For Avoiding Business Litigation

In the movie WarGames, the American military’s supercomputer, Joshua, repeatedly simulates global thermonuclear warfare until discovering the futility of it all, observing, “A strange game. The only winning move is not to play.” The same can almost always be said of litigation. For a multitude of reasons, the best way to win a lawsuit is to avoid it from the beginning.

First, litigation is costly, both in dollars spent and time wasted. Unsurprisingly, in a 2015 survey of chief legal officers, costs rank as management’s number one concern. The cost of defending (and ultimately resolving) a lawsuit, even one with dubious merit, can be prohibitive. Nationwide, small and midsize businesses faced with employment lawsuits spend an average of $125,000 – and 275 days – to settle them. Read more at Fletcher Tilton…

When you consider the average amount of money and time spent on business litigation, you can see that not being pulled into a proceeding or finding a way to resolve it outside of the court system is the wisest move.

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Lawsuits are often filed based on loopholes that exist, either the omission of something or fault found in what was done. The following post describes how you can avoid these problems:

Always consider how the decisions you make today will affect your life tomorrow.

Sage advice that applies to your small business as well. Consider the following decisions that you can make today to avoid litigation tomorrow:

Put It In Writing

With limited resources and even less time, small business owners may overlook the importance of formalities like drafting written contracts and requiring the signature of all parties. Mind you, not all agreements need to be in writing to form a contract. However, a written contract may help avoid the time and expense of litigation.

When all the terms and conditions of an agreement are in black and white, there is less chance for confusion and disagreement. Read more at Kreis Enderle…

As explained in the post above, it is key that every aspect of a business venture or agreement be addressed in writing. This is the best way to ensure that both parties understand their roles and responsibilities, and it helps to protect your business in the event of a lawsuit.

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Having said that, it is paramount that any written agreements adhere to the bounds of the law. For instance, you must recognize that there are limitations to how much power you can assert in certain contracts. Go too far and you will be seen as impeding on the rights of the other party. This may cause you to lose a lawsuit you thought you were protected from.

The following post discusses a specific legal example that applies to North Carolina businesses:

A Few Things To Avoid When Drafting A North Carolina Covenant Not To Compete

The Business Court closely examined a set of restrictive covenants last week in Sandhills Home Care,, LLC v. Companion Home Care-Unimed, Inc., 2016 NCBC 59. This decision collects a number of North Carolina Court of Appeals decisions assessing the validity of covenants not to compete (and non-solicitation and non-inducement covenants) and highlights language contained in many restrictions which is probably invalid.

Don”t Overreach In Describing The Activities That Will Be Restricted

The Plaintiff’s covenant against competition said that its former employee could not “work for, provide services for, consult with, or otherwise assist any individual or entity who is in the home health or personal care business competing with the Employer” in the North Carolina counties in which the Plaintiff was providing services at the time of the employee’s separation. Read more at North Carolina Business Litigation Report…

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The surest way to know that your contracts will hold up under legal scrutiny is too have them drawn up by a qualified business attorney. Jonathan Meek at Meek Law Firm has the education and experience needed to successfully represent your interests.

Contact Meek Law Firm today to discuss all of your business legal needs. Call (704) 848-6335 or use the contact form on the right of this page to schedule a consultation appointment. We look forward to hearing from you.

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About the Author:

As a small business owner, Meek has a passion for working with others who found and work for small- and medium-sized businesses. His goal is to not only help them protect and grow their businesses but also to resolve any personal legal issues they might face along the way.

Meek is a member of the North Carolina Bar Association, the Mecklenburg County Bar Association, and the North Carolina State Bar. He is also on the board of Open Aperture Productions, a legal videography firm that he began in 2003. In addition, he participated in many hours of pro bono service during his law school career, including an externship with the Mecklenburg County District Attorney.