Business Lawyers Blog
Options When Faced with a Legal Dispute
When faced with a legal dispute, it is important to know what your options are. A San Jose business owner typically juggles multiple commercial relationships on a regular basis – vendors, clients, employees, contractors, and business partners. Given the nature of running a business, it is likely that a legal dispute will come up at some point. When this happens, it is very important to educate yourself on what your options are. Litigation can subject a business to unnecessary stress, be huge time sink, and cost you significant legal fees and expenses. Alternative dispute resolutions like mediation and arbitration are processes that may allow you and the other side to reach a solution that you both can live with without the substantial causalities that litigation typically entails.
The experienced San Jose corporate attorneys at Structure Law Group have extensive experience in litigation, mediation, and arbitration. They can discuss the pros and cons of each option with you and help you pick the best course of action for your business.
Litigation
Litigation is when a party files a lawsuit and goes through the formal court system. After initiating the lawsuit and investigating the evidence, the parties will go to trial where a judge or jury hears each side’s argument and reviews the evidence. The judge or jury then comes to a decision which can leave the plaintiff with some, all, or none of the requested financial relief. A trial is risky for both the plaintiff and the defendant. A plaintiff may ultimately come away with nothing from the trial while incurring heavy litigation expenses. Between filing fees, attorneys’ fees, and other court costs, the expense of litigation can be significant. For the defendant, he or she may lose at trial and have to pay the full amount of money requested by the plaintiff in addition to his or her own attorneys’ fees and expenses. Further, judges have the authority to order one party to pay for the other party’s litigation expenses in certain circumstances (usually as a result of a party’s bad acts). All of these considerations make litigation a risky proposition.
There are times when litigation is the only option for protecting important legal rights. If a defendant refuses to settle and/or shows no willingness to negotiate, the only option is to go to trial. On the other hand, if a plaintiff makes claims which harm a defendant’s reputation or the goodwill of its business, it may be necessary to proceed with litigation in order to protect the financial interests implicated by them. Outside of these extreme circumstances, it is often possible to negotiate a settlement which can save both parties a lot of time, money, and heartache.
Mediation
Mediation is a process whereby a neutral third-party (the mediator – who is typically an experienced attorney or retired judge) helps the parties and their attorneys to negotiate the terms of a settlement. The process is sometimes administered directly by the court in order to promote settlement and clear up its own litigation calendar. The goal of mediation is to reach an agreement that both parties can live with (even if neither party got exactly what they wanted). One of the benefits of mediation, as opposed to having a judge make the decision, is that the parties have more control over the terms of the negotiation and cannot be forced into accepting an offer they do not want. Also, mediation can speed up the process and allow the parties to reach a resolution much more quickly rather than going through the court system and having to follow all the formal litigation rules and procedures. Mediation is typically good for parties who wish to still maintain a relationship after resolving the legal dispute. However, if there is a significant power imbalance between the parties, mediation may not be the best option.
Arbitration
Arbitration is similar to litigation in that the parties will present their arguments and evidence to the arbitrator, who makes findings and decisions regarding the case. It is up to the parties whether they want to make the arbitrator’s decisions binding, meaning that no matter what decisions the arbitrator arrives at they will have to live with it, or non-binding, in which case the parties can ignore what the arbitrator decides on if they are unhappy with it. The benefit to this process is that you will have access to what is the equivalent of a private judge who is able to process your case faster, which can save you money. Just keep in mind that if you agree to binding arbitration, you usually cannot appeal the decisions of the arbitrator.
Aside from the things discussed above, there are other considerations that would be worth talking to an attorney about as you are weighing your options.
Contact an Experienced California Corporate Attorney Today
The experienced corporate attorneys at Structure Law Group can help business owners determine which process would be best for them, whether that is mediation, arbitration, or litigation. Schedule a consultation today by calling (408) 441-7500 today, or emailing slgadmin@structurelaw.com.