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Navigating The Complexities Of Business Litigation: A Comprehensive Guide

According to the Alliance for the Betterment of Citizens with Disabilities, 90% of all businesses encounter a lawsuit at least once during their lifespan. Also known as “business litigation,” a business-related lawsuit can dramatically alter the trajectory of any given company. Survival depends on effective responses. Some organizations are sued by government organizations, while others face lawsuits from private individuals. Of course, businesses also sue each other on a regular basis. Although statistics show that business litigation is virtually inevitable, companies can confidently prepare for this inevitability by working alongside experienced business litigation attorneys in New York. Schwab & Gasparini can help companies currently embroiled in lawsuits – and those that need to prepare for future litigation. Book a consultation to discuss specific business goals in more detail. For the Syracuse Office, call (315) 422-1333. For the Albany Office, call (518)591-4664. For the White Plains Office, call (914)304-4353. For the Hudson Valley Office, call (914)304-4353. 

Breach of Contract Is a Common Example of Business Litigation

Contracts represent the legal foundation for business operations. Without these written agreements, it would be impossible to confidently engage in trade. This includes not only trade between companies, but also employment relationships, customer agreements, and much more. All of these parties have the potential to breach their contracts, and these breaches can lead to lawsuits. For example, a manufacturer might sign an “exclusivity contract,” agreeing to provide products to only one specific company. If this company discovers that the manufacturer is providing the same products to other companies, they could potentially sue for breach of contract. 

Of course, a business may face false accusations in a breach-of-contract lawsuit. Perhaps the plaintiff company has misinterpreted the contract. Both parties might dispute the specific phrasing or meaning of certain clauses. These disputes may be resolved through mediation – a private negotiation process that occurs outside of court. Perhaps the most effective way to avoid breach-of-contract lawsuits is to draft these agreements effectively alongside an experienced business litigation law firm in New York – such as Schwab & Gasparini. 

Business Litigation Often Involves Employees

Employment lawsuits are relatively common in the business world. Many employees sign employment contracts before working with companies, and these agreements may contain various clauses. Employment lawsuits often arise after alleged cases of wrongful termination, discrimination, and harassment. 

In some cases, employment lawsuits function like breach-of-contract claims. For example, an employment contract might state that an employee may only be terminated for specific reasons. If the employee is terminated for some other reason, they could potentially sue their employer. However, employment lawsuits may also arise in the absence of employment contracts. The Civil Rights Act and the Equal Employment Opportunity Commission can facilitate lawsuits based on harassment or discrimination. Companies shoulder liability for the alleged misconduct of their employees, managers, and leaders in these cases. 

What Happens When a Business Is Sued by Its Customers?

A business can also face lawsuits from its own customers. Perhaps the most common example is a product liability claim. If a company manufactures, markets, or designs certain products, it may face “strict liability” for any injuries suffered by customers. For example, a company might manufacture and sell e-bikes in New York. If a customer suffers a traumatic brain injury due to defective brakes, they could potentially sue the company for millions of dollars. 

Aside from product liability claims, there are many other reasons a customer might want to sue a company. A common concern in the modern era involves cybersecurity. If a major company fails to secure customer data and the information is compromised due to a ransomware attack, customers can potentially sue companies for negligence. This is especially problematic when companies deal with sensitive customer data, such as financial or medical information. 

What Happens When Your Business Is Sued by the Government?

State and federal government organizations regularly sue companies in New York. In the past, New York Attorney Generals have shown a willingness to sue companies for all kinds of alleged misconduct. This includes deceiving customers, exploiting youth mental health with social media, predatory lending, improper use of plastic, and much more.

Not only can these government lawsuits lead to financial penalties, but they can also cause serious reputational losses. When a US government organization sues a company for wrongdoing, the implication is that the company is somehow harming Americans. The true “cost” of a government lawsuit may go far beyond seven-figure fines, causing a company to lose millions of customers over the next few years. 

Can I Go to Jail for Corporate Crimes?

Just like an individual, a corporation can face both civil and criminal litigation in US courts. Often, a corporation “shields” its executives, owners, and employees from potential legal consequences. When a corporation is found guilty of wrongdoing or negligence, financial penalties represent the most common consequence. However, corporate executives, owners, and leaders have faced criminal penalties for actions taken within companies. “White-collar crime” can certainly lead to criminal consequences on the individual level, including incarceration. These cases usually involve serious fraud – such as healthcare fraud, Ponzi schemes, money laundering, and high-level tax evasion. 

As arguably the most important economic hub in the world, New York is home to numerous financial companies. Many of these organizations are on the cutting edge of fintech, implementing peer-to-peer lending, cryptocurrencies, and artificial intelligence. When average Americans lose their investments, the CEOs and leaders of these companies face the very real threat of incarceration. Within the past few years, numerous fintech CEOs have been imprisoned under these circumstances. 

Contact Schwab & Gasparini Today

Business litigation is an incredibly complex topic that encompasses countless potential legal issues. Each company is unique, and each company may encounter distinct legal challenges during its lifespan. While internet research provides a basic explanation of business litigation, an online article cannot implement targeted legal strategies based on specific company needs. For personalized guidance, company leaders should consider consulting experienced business litigation lawyers in New York to learn more about their legal and financial rights in any business ligitagion matter. Choose Schwab & Gasparini today – and begin this important discussion today. For the Syracuse Office, call (315) 422-1333. For the Albany Office, call (518)591-4664. For the White Plains Office, call (914)304-4353. For the Hudson Valley Office, call (914)304-4353. 

Sun Jul 7 2024, 12:00am