2018-01-31 00:00:00Business LawEnglishGet tips on what to do if a customer or another entity brings a lawsuit against your business. Review some of the options you have in the...https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2018/02/Small-business-owner-reviews-steps-to-mitigate-a-civil-lawsuit.jpgYour Business Has Been Sued: What Happens Next?

Your Business Has Been Sued: What Happens Next?

1 min read

If an upset customer sues your business, you should not panic, but you need to respond quickly and professionally. Your response can have a direct impact on the result of the lawsuit and on the future financial health of your business.

First and foremost, contact a lawyer. You should not attempt to handle a lawsuit on your own. Additionally, do not reach out to the individual who is suing you. If you speak with them, you may accidentally share information that could compromise your defense. Remember, you don’t have to take a lawsuit to trial. Ideally, you should start with mediation or try to negotiate a settlement out of court. Both of those solutions help to reduce publicity around the case, and that can be critical in terms of safeguarding your business reputation.

If the customer has brought a civil claim against your business, you can opt to just pay the claim. This option also keeps the case out of the courtroom, and it can be a fast and easy way to deal with a lawsuit. If you don’t agree with the plaintiff’s claim, you can file a dispute notice. Then pay a filing fee and the issue goes to court. If you believe you have a claim against the plaintiff, you can include a counter claim in your dispute notice.

Note that these tips only apply to cases where a customer or another third party is suing you. If an employee brings a lawsuit against you, the process can be slightly different. Getting sued can be scary and stressful. Try to stay calm and remember that other businesses have survived lawsuits in the past. Again, to increase your chances of success, have a lawyer help you through this process.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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