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5 things you should do if your company gets sued

On Behalf of | Apr 3, 2023 | Litigation

Lawsuits are among the most daunting challenges any business can face. They can be costly, time-consuming and emotionally draining. However, it’s crucial to remember that every company, regardless of size or industry, is vulnerable to legal action.

If your company is hit with a lawsuit, here are some things you should do to protect it.

1. Stay calm

If your company gets sued, the first thing to do is remain calm. It’s natural to feel overwhelmed and upset, but acting rashly will only make the situation worse. So instead, take a deep breath, step back, and focus on the steps you need to take to protect your business.

2. Review and understand the allegations

Once you have regained your composure, it’s essential to understand the nature of the allegations against your company. Read the complaint carefully and  make sure you understand the claims being made. Seek legal advice to help you understand the complaint and assess the potential impact on your business. Critically, confirm with your lawyer how much time you have to respond and take appropriate steps to protect your company.

3. Notify your insurer

If your business has liability insurance, you should notify your insurer as soon as possible after being served with a lawsuit. Your insurer will be able to assess the situation and provide guidance on how to proceed. Remember, failure to notify your insurer on time may jeopardize your coverage.

4. Gather evidence

In order to defend your company against the allegations, you will need to gather evidence to support your case. This may include documents, emails, contracts and other relevant materials. Therefore, make sure that you also preserve all evidence that could be relevant to the lawsuit. Suspend any policy that provides for automatic purging of records.

5. Communicate with stakeholders

You need to keep your stakeholders informed about the lawsuit and its potential impact on your business. This may include key employees and investors. Keep them informed with developments and reassure them that you are taking steps to protect the company’s interests.

Getting sued can be a stressful and challenging experience for any business. We recommend that you promptly consider seeking legal guidance to protect your company when a lawsuit comes your way.