By Jamie Moore Marcario, Esq.
As a business owner, you’re constantly making decisions. Tough ones. But one of the most difficult decisions a business owner ever has to make is whether or not to pursue legal action when a client, vendor, business, employee, or even some random Google reviewer who you’ve never interacted with—ever—harms your company. Whether the individual or business defamed your company online or verbally, failed to perform the terms of a contract, misappropriated your trademark or other intellectual property, or stole your company’s trade secrets and shared them with the competition, you may find yourself wondering whether or not you should sue and how to decide whether it’s worth it. Before you file a lawsuit, make an appointment with your business lawyer and consider the following factors.
You may think you know who you want to sue, but do you really? What if they’re doing business under a fictitious name? Is it going to be easy to locate the business or individual you want to sue? If someone doesn’t have a permanent address or you don’t know where they live or work, it can be difficult to serve them with the papers necessary to start a lawsuit. Process servers may charge for each failed attempt, which can quickly cut into the potential compensation you might gain from the lawsuit.
How much do you honestly think you stand to gain from the lawsuit? Remember that the goal of the court is to make damaged entities whole. If your business has suffered minor damages or it’s difficult to substantiate your damages, a lawsuit may not be worth the stress, time and money.
With your business attorney, you should take a long, hard realistic look at the actual damages your business has sustained. If your lawsuit is to be successful, your business must have sustained actual financial damages—perhaps in the form of financial losses sustained due to damage to your reputation, lost revenue from the other party’s misuse of your intellectual property, extortion, or civil theft. Once you and your attorney have determined the actual losses your business has suffered, your attorney can help you realistically assess how much you can expect to recover in the lawsuit.
Winning in court is one thing—collecting on the judgment awarded to you is another. If the defendant doesn’t have a lot of assets or money, you may find yourself with a piece of paper that says you won, but you’ll be unable to collect the money you’re owed. This is just one more reason it’s important to have an attorney represent you in a lawsuit. Your business attorney can conduct an initial investigation of the person or business you want to sue to see whether or not they are judgment-proof.
Even if the other party turns out to be judgment-proof, it may still be worth it to bring a lawsuit if doing so allows you to stop ongoing harm to your business. In certain circumstances, you must take legal action to avoid even bigger issues down the road. For example, if you fail to protect your trademark when you find out someone is infringing on it, the delay in taking action may cause you to lose your trademark. For that reason alone, you must bring a suit against someone illegally using your trademark. Not only that, but a judgment in your favor shows the offending party that there are consequences for their actions, giving them a reason to stop slandering your business and professional reputation, to perform the contract terms owed to you, or otherwise stop the harm they are inflicting on your company.
If you’re a business owner, lawsuits are inevitable, but you shouldn’t try to go it alone (and under Florida law, you can’t). You need passionate, dedicated legal counsel on your side. Call Thrive Law at (727) 300-1990 to discuss your legal options.