4 POTENTIAL LAWSUITS THAT SMALL BUSINESS OWNERS NEED TO WATCH OUT FOR
When starting a business one of the last things on the business owner’s mind is the possibility of a future lawsuit. Unfortunately, both small and large businesses face the risk of a possible lawsuit and a majority of those lawsuits are frivolous. The threat of a lawsuit is not declining; in fact, the number of lawsuits filed has increased over the past twenty (20) years. Business owners have to be extra careful as lawsuits can be filed by individuals both outside the business (by customers or competitors) and from inside the business (by employees)
The type of lawsuits normally faced by employers fall into four (4) main categories:
1. Contractual Disputes: Most business owners become familiar with contracts very soon after starting their business. Contracts are a great way to establish the terms of a business relationship and provide the parties with protections. However, problems arise if a contract is breached (or violated). It is important that you carefully read each contract and make sure you fully understand the rights and obligations of all of the parties prior to signing it.
2. Employment Law Actions: A number of issues can arise once a business grows and employees are needed. Employment laws can vary greatly based upon geographical location and can affect every area of employment (from hiring to termination and everything in between). It is recommended that a business owner develop certain policies and procedures on behalf of the business and memorialize them in an employee handbook.
3. Intellectual Property Rights: Most businesses try to set themselves apart from other similar businesses using logos, trademark, key phrases and other images. It is important that you check the ownership of any intellectual property prior to using it (and make sure that you get permission in writing from the current legal owner prior to using it). If you develop your own intellectual property, make sure that you take the steps to properly protect it so that no one can try to take it from you.
4. Fraud: No one ever wants to face charges of fraud; most business owners try to run their businesses as honestly and fairly as they can. However these type of lawsuits still occur, normally due to someone claiming that your business engaged in deliberate, malicious actions, such as deceiving your customers or treating them unfairly.
The majority of most business related lawsuits can either be avoided or resolved through calm, careful planning. In the event that a lawsuit is filed (or if you are concerned that one is going to be filed), it is recommended that you consult with an attorney as soon as possible to evaluate your options and determine how you wish to respond (or proceed).
Should you have any questions about protecting your business from potential lawsuits or any other law that may affect your business, please contact Waltz, Palmer & Dawson, LLC at (847)253-8800 or contact us online.
Waltz, Palmer & Dawson, LLC is a full-service law firm with various areas of service to assist your business, including: Employment Law, Intellectual Property, Commercial Real Estate, Business Immigration, Litigation and general Business Law services. Individual services include Estate Planning, Wills and Trusts, Probate, Guardianship, Divorce and Family Law.
This article constitutes attorney advertising. The material is for informational purposes only and does not constitute legal advice.