Lawsuits are never fun to deal with; they’re expensive, stressful, and the process can be overwhelming and confusing. Unfortunately, it’s not uncommon for small and medium-sized businesses to be involved in lawsuits, and while it can get stressful, the most important step to take is to remain calm. When you’re calm, you can think more rationally and tackle this challenge head on. Here are the steps to take if your small business is being sued.
Review the lawsuit in detail
The first action you should take is to fully review the lawsuit and make sure you understand it. Make sure the claims and timelines are accurate and have your lawyer check everything over once as well. If you don’t understand what the lawsuit entails, how can you properly fight it?
Check your business insurance coverage
Next, you should check to see if your business insurance policy covers lawsuits, including lawyer fees, court costs, or settlements made to save your business some money. If you already know you have professional liability insurance, this is when you claim it. You should also inform your provider of the legal action being taken against you so they are aware.
Gather evidence
Before waiting too long, take photos or write down notes about what occurred from your point of view. Get any security footage from cameras as well. You want to make sure you record your side of the story with as much physical proof as you can so you can properly defend yourself, especially if your recount of the event is different than what’s written in the lawsuit filed against you or your company. You can utilize a service like computer forensics Cleveland to help get any evidence ready and analyzed for your legal case if or when it comes time to go to court. The best way to handle any legal action is to be as prepared as possible, so keep that in mind.
Write your response
The final step to take is to craft your response to the lawsuit. You will want to make sure you respond within the timeframe set in the lawsuit, so double check how much time you have to do so. Your response should specifically speak to each allegation, stating if you agree or disagree with what they’re accusing you of. If you disagree, this is when you would explain why and detail your counterclaim, if you choose to make one.
Furthermore, you should outline possible outcomes at the end of your response. If you believe your business will spend more money fighting the allegations in court in terms of legal fees and time spent, it might be wise to include an out-of-court settlement as one of your possible outcomes.
While it can be tempting to contact the person who filed the lawsuit, the plaintiff, don’t do it. During an active investigation, the best course of action is to do all communicating through your lawyers, even if you have an established relationship with that person already. You don’t want to accidentally incriminate yourself and make it easy for them to win their lawsuit.
