Most business owners are likely aware that business disputes are an unfortunate reality of running an enterprise. Even when business owners go the extra mile to keep their companies in tip-top condition, they may still experience intellectual property theft or grapple with disagreements between partners.
It can help to anticipate these conflicts to help ensure they don’t disrupt business operations, water down a company’s reputation or cost a company significant resources. For many diplomatic business owners, negotiation is a preferred approach to resolving business disputes. However, it helps to acknowledge that litigation may be a necessary next step to achieve a resolution in some unique situations.
Breach of contract
Businesses need contracts to build a solid foundation for their relationships with vendors, suppliers and partners. These agreements are essential because they outline the obligations and expectations of each party in the business relationships.
When one party in a business relationship breaches the contract, this can compromise the performance of the enterprise. A breach of contract can also introduce unexpected financial hardship that can cast a cloud of uncertainty over the future of the enterprise.
Through litigation, a business can de-escalate the consequences of a contract breach to help secure the continuity of the enterprise. Initiating a lawsuit can allow the aggrieved party to seek financial reimbursement for their monetary losses.
Intellectual property infringement
A business’s intellectual property is a valued asset because it helps the enterprise present itself as a unique brand to the target customer base. However, suppose a competing business copies these essential assets. In this case, the original brand can lose customers and suffer a dilution of brand reputation.
With the help of a reliable legal team, the original business can seek an injunction. This can prevent the at-fault business from continuing to piggyback on the original brand’s unique innovations. A legal team can also estimate a business’s lost profit due to intellectual property infringement. This way, the affected business can be awarded maximum compensation for the financial harm they’ve incurred.
Many businesses opt for litigation as a last resort; however, it remains an essential mechanism for resolving serious business disputes. With the guidance of a reliable legal team, business owners can better understand instances when a lawsuit can potentially help to de-escalate their legal troubles.