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Business Disputes: When is it Time to Litigate?

As a business owner or executive, it is critical to know when a dispute merits litigation. Litigate too early, and you may waste resources – and destroy relationships – that could have been preserved with a less-contentious approach. Wait too long, and you could risk more damage – and perhaps irreparable damage – to your business’s market position, goodwill and other intangible assets.

Assessing Potential Claims in Business Litigation

Knowing when it is time to litigate requires a careful case assessment. In many cases, this assessment must continue over time as circumstances develop and new facts warrant reconsideration of previous strategies. At a high level, and depending on the facts and circumstances involved, the following are all examples of business disputes that have the potential to justify litigation:

  • Breach of Confidentiality – If a current employee, former employee or supplier has breached an obligation of confidentiality, prompt action may be necessary in order to mitigate the damage. Wrongful disclosure of trade secrets, business strategies or other confidential information can lead to irreparable harm if it is not possible to prevent further dissemination.
  • Breach of Contract – From violation of licensing restrictions to non-payment and failure to perform, there are a wide variety of contract disputes that may ultimately warrant litigation.
  • Disputes Arising in Connection with the Sale of a Business – When negotiations break down or there is an issue post-sale, mergers and acquisitions have the potential to lead to litigation as well.
  • Fraud – In the business context, there are a variety of different types of fraud. If a customer, supplier or other party has defrauded your business, initiating a lawsuit may be your only option for obtaining a satisfactory resolution.
  • Unfair Competition – If a competitor (or potential competitor) is trading on the value of your company’s goodwill, this too may require immediate action. There are preliminary remedies available to curtail the damage, and protecting your business may require promptly going to court.
  • Violation of Non-Competition and Non-Solicitation Covenants – Violation of contract provisions that prevent employees, licensees, suppliers and others from competing with your business directly or making use of your customer list is another issue that may necessitate litigation. While some violations of non-competition and non-solicitation covenants are inadvertent (and as a result can be relatively-easily resolved), others represent direct and intentional attempts to wrongfully divert business to a competing entity.

Regardless of the dispute at hand, filing a lawsuit is not a decision to be taken lightly. From the potential cost of obtaining a resolution at various stages of the litigation to the business value of any remedy likely to be obtained, there are numerous issues that factor into the analysis. If you are facing the prospect of litigation in Fort Lauderdale, our firm can assist you in conducting a prompt and comprehensive case assessment.

Speak with a Business Litigation Attorney at Michael L. Feinstein, P.A.

The attorneys at the Fort Lauderdale law offices of Michael L. Feinstein, P.A. bring decades of experience to representing business clients in complex state and federal litigation. If you would like to speak with one of our attorneys about conducting a case assessment, please call (954) 767-9662 or get in touch with us online today.