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5 common disputes faced by businesses

On Behalf of | Sep 17, 2021 | Business Litigation

Business litigation costs Texas companies and others across the country over $100 billion each year. Unfortunately, it’s typically not a matter of “if” it will happen, but “when.”

In general, business lawsuits fall under three categories: Litigation brought by employees, other companies or customers.

Most common grievances faced by employers

Depending upon the size of your business, your operation may interact with dozens or thousands of stakeholders of varying degrees. Some of the most common conflicts that arise include:

  • Employee disputes: These can occur between co-workers or between employees and owners or management. Conflicts include sexual harassment, discrimination and pay-related disputes.
  • Contract disputes: Disagreements often occur over employment contracts, partnership agreements, non-disclosure agreements and others.
  • Downsizing: Running a business is costly, and a sudden loss of revenue can lead to mass layoffs. But employers must be able to justify not only the need to downsize but follow state and federal guidelines for terminating employees.
  • Intellectual property: Creators of products, designs, images, music, art and names often sue businesses over ownership disputes. Companies must ensure that everything they own is copyrighted, trademarked or patented.
  • Consumer disputes: Businesses can’t live without customers. Defective or shoddy products can not only result in lawsuits but damage a company’s reputation, causing long-term harm.

Shielding your business from lawsuits

The best way to avoid legal conflicts is conducting business and treating employees at the highest possible level. Working with an experienced business law attorney is crucial to draft policies and procedures that hold up against legal scrutiny.

You may also have some personal protection, such as if your business is a limited liability company (LLC). Your lawyer can advise you on other protections, including choosing the right types of insurance products and coverage levels to minimize potential damages.