What to do if Your Small Business is Sued

Even if you are running a small business, you could get sued for a ridiculously large amount of money due to a single mistake.

In addition to some basic precautions, you will also need to take other steps to counter the attack and increase the probability of winning the lawsuit.

Let's look at some steps you should take if your small business is sued.

  • Hire An Attorney Immediately. You should immediately hire an attorney in order to file a response to the lawsuit.

    If your insurance policy specifies that the insurance company will defend you, then that is even better. Ultimately, it might be the insurance company that will have to cough up the money if you lose the case.

    This brings up another important point - and that is to take out an adequate insurance policy in the first place.
  • Do Not Waste Time. Do not treat a lawsuit as a low priority. If you do, you and your attorney will not have enough time to prepare for your defense.

    It might also send the wrong message to the court if you are unable to file your response during the required time frame.
  • Get The Relevant Papers Ready. If an employee has sued you, then you need to get all the papers related to him/her or their attorney.

    If a client has sued you for lack of service or due to a faulty product, then you will have to gather factual data on your service or product.
  • Launch A Counterattack. In addition to filing your defense, you will also need to find out the chinks in the armor of the employee or client that is suing you.

    If you are not at fault, then you will also need to plan your counterattack along with your attorney.

If you find yourself in this unfortunate situation, there is no need to panic. Instead be prepared - that is the best defense.