Common Types Of Business Litigation

Because legal disputes can arise for many reasons, it is imperative for business owners to understand the basics of business litigation. Business litigation, also known as commercial litigation, refers to a type of litigation that derives from commercial and business relationships. There are many instances where business litigation may ensue, such as breach of contract, breach of fiduciary duty, partnership disputes, shareholder litigation, claims from governmental entities, or claims against another business.

Business litigation oftentimes involves complex legal issues, comprised of countless legal aspects and sometimes multiple areas of law. Furthermore, lawsuits are public records and could potentially have adverse effects on a company’s PR. Therefore, it is crucial to enlist the services of a knowledgeable and experienced business attorney. Continue reading the article to learn more about the common types of business litigation.

Intellectual Property Disputes

As a concept, intellectual property relates to products of human intellect that are granted the same protective rights as physical property. In general, intellectual property refers to intangible assets, including trademarks, patents, trade secrets, and copyrights. Intellectual property law protects intangible intellectual property from unauthorized use. If a business believes that there has been an intellectual property violation, a business attorney will usually investigate the party in breach of intellectual property infringement laws. From there, business litigation may ensue.

Breach of Contract

A common type of business litigation occurs because of a breach of contract. There are many contracts that a business may enter; a business may enter a contractual obligation with other businesses, clients, or employees. The contracts may be used to dictate employment, contractual service obligations, distribution of products or services, property leases, or virtually any other facet that may impact the business. Business litigation may begin because of a breach of contract, whether a business is suing or being sued by another party. Typically, breach of contract business lawsuits result in monetary compensation or another remedy to the situation. If a business has been sued for breach of contract, the business must decide whether it is advantageous to settle or proceed with the suit. Before making a decision, consulting a business litigation attorney can allow a business to understand all options available.

Partnership Disputes

Partnerships relationships are generally amicable initially, with partners entering the business holding similar values, goals, and expectations. However, partnership disputes may begin to arise over time. Partners start to disagree on what is best for the business or how the business should be run. For example, a partner may attempt to introduce a new product that the other partners disagree with. Partner disputes can also occur when a partner misappropriates funds or assets or engages in fraudulent and illegal activity that hurts the business. In instances of partnership disputes, a partner may decide to negotiate with the other partner to resolve differences, or a partner may buy out the other’s interest.

Additionally, a partner may decide to go to court to protect themselves and the business. Separately, shareholders may have an issue with the way partners are operating a company, which could also result in business litigation. These lawsuits are referred to as shareholder litigation. Partnership disputes and shareholder litigation often lead to extensive litigation, making it costly. An experienced business litigation attorney can help you navigate shareholder and partnership litigation complexities, allowing you to explore the best potential courses of action.