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5 Signs Your Company Should Pursue Litigation

by | Oct 23, 2022

A dispute arises between your business partner, client, manufacturer or a third party. What do you do? First you should try to resolve the dispute as amicably as possible. However, if an amicably approach does not work, then you need to consider other dispute resolution solutions. There are numerous forms of legal dispute resolution available, such as alternative methods like mediation or arbitration, and litigation is generally the most aggressive and potentially risky option.

Mediation offers a possible solution if it appears that a mediator may be able to discuss the legal issues between the parties and reach a compromise.  However, Mediation requires two parties that are ready and willing to discuss their dispute reasonably and to compromise if needed. Arbitration requires the parties to agree to arbitrate their dispute before an arbitral panel under different rules and procedures and eliminates the need for litigation through the courts except where enforcement of the arbitration award is required.

Ultimately, many companies have no choice but to pursue litigation. Deciding whether to enter into litigation in order to resolve a dispute is a major decision for most businesses.

But sometimes it can be the only means for achieving the resolution you desire. So how do you know if litigation is the proper avenue for reconciling your grievance?

In this blog we have detailed five signs that your company should pursue litigation to resolve its dispute. Please keep in mind that this blog is not intended as legal advice for your specific situation. Any potential for litigation should be reviewed by a knowledgeable business attorney, like those at The Campbell Law Group, before you take any action. If you are interested in pursuing litigation to resolve your business dispute, please give us a call today.

1) Cost/Benefit in Your Favor

Every business owner should be very familiar with cost/benefit analysis. It is when you weigh the potential rewards of taking a particular action versus the potential or known costs of taking said action. As a business owner, you likely conduct cost/benefit analyses in your day-to-day business dealings, such as deciding on whether or not to invest in facility updates or deciding whether to lay-off employees. You also need to conduct such cost/benefit analyses in situations where you are considering litigating a dispute. Is what you stand to gain from litigation worth the cost it will take to achieve that gain? If not, such as in a dispute over a small sum of money, then litigation may not be worth the time, money, and effort.

2) You have a strong case

Before pursuing litigation, you need to be certain that you have a strong, clear case against the opposing party. Can the case be effectively proven in court? An experienced business attorney can analyze the evidence and advise you on your chances of winning your case. If you do not have a strong case, then you may want to seek out other remedies.

3) Alternative methods exhausted

Generally, litigation should only be considered when all other forms of dispute resolution have been exhausted. If negotiations towards a settlement have failed, and mediation and arbitration are not possible or have also failed, then it may signal that the time has come to litigate the case.

4) You are not concerned about details of the dispute going public

It is always important to remember that litigated courtroom proceedings are public record. If the nature of your dispute is sensitive, or you are concerned that you will be forced to share any information that you don’t want to become public knowledge as a result of the proceedings, then this may factor heavily into your cost/benefit analysis. Mediation or arbitration may be better suited for your situation if you want the nature and details of the dispute to remain private.

5) You will be able to collect a potential judgment

You may have an ironclad case that you are certain you will win, but will the award be worth pursuing if the defendant has no assets to collect? Litigation is only worthwhile in circumstances when you know the opposing party has the assets available to collect the judgment if you win.

The decision to litigate a dispute is not a choice that should ever be considered lightly. Always consult with an experienced attorney to help you decide on the most beneficial course of action for your company. Please contact The Campbell Law Group today.

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