Negosentro.com | What to Do If Your Business Gets Sued | Learning that there is a legal claim against your business can be a very stressful situation, particularly when it’s initiated by someone with whom you’ve had a close working relationship or a former employee. How you respond can have a big impact on the outcome. You have to think strategically, and not let your emotions about getting sued influence your actions. Your primary agenda is defending your business successfully. Getting upset or trying to take retaliatory action against the person or business entity bringing the claim won’t help matters. The most fundamental components of handling a lawsuit are staying calm, getting organized, and getting good help. Here are some things that you should do if your business is dealing with a lawsuit.
Notify Your Insurance Carrier Immediately
As soon as you are put on notice of claim, you should contact your insurance provider to let it know what is going on. In fact, before a claim is initiated, you should reach out to your insurer to let it know about an event that you think may give rise to a claim such as an accident in the workplace or an accident that damaged another party’s property. Notifying your insurer about claims could be part of your policy’s agreement, so an insurer could refuse to provide coverage in a situation when you fail to put it on notice of a claim. Some lawsuits such as those related to personal injury or other forms of negligence may come in the form of court filing but rather a demand letter requesting contact information for your insurer. Per statutory law, you may very well have to provide it.
Bear in mind that many legal claims, defense will not be your burden and isn’t something that you’ll have to retain counsel for. Depending on the scope of your insurance policy, your insurer will be responsible for the legal costs and logistics of defending a claim or reaching a settlement agreement. However, you will need to allocate some time towards working with your insurance representative or your insurer’s counsel to help them investigate the allegations or prepare a defense.
Consider What Information May Be Important, Locate It, and Organize It
Give some thought to what information within your possession is relevant to the claim. You should make every effort to preserve evidence. For example, if the claim involves an incident that was captured on a security camera, you may wish to save it before you run out of physical storage or cloud space in your recording space. If a claim was made by an employee about your employment practices, you may wish to locate their personnel file. In addition, consider what testimony may be relevant to a legal suit and ensure that you have contact information for everyone who can answer questions about matters of factual dispute.
Providing testimony doesn’t necessarily need to happen in a courtroom. Witnesses can share key information in a deposition. In this setting, a witness swears under the penalties and perjuries of law. Court reporters Portland Oregon create formal records of how a witness answers testimony during a deposition, and the record may be introduced into evidence during court proceedings or shared with opposing counsel in advance of trial.
Confer With Counsel and Take Internal Corrective Action
Even if your insurer will handle a claim’s defense, it may be advisable to confer with in-house counsel or retained counsel about the claim. Your lawyer can help answer some questions that you have about the claim. Legal counsel also can help identify if you should take any type of internal remedial measures. If the alleged wrongdoing did not actually occur, there may be problems with policies or procedures that made you vulnerable to the claim. Enhancing the quality of certain accounting policies, training staff about topics such as safety or harassment, or creating new safety and security infrastructure could help to protect your business against legal claims.
