It is no shock that we live in a litigious society. Businesses are bounded by legal laws that are needed to be followed to perform business legally in any state. One of the most important law there is to know is of corporate litigation.
Also, check out: How to Trademark A Business Name!
Especially if your business is ‘incorporated’ as such. you would want to get some understanding of corporate litigation under your belt so you can ensure that your business runs well within the legal confinements.
It is also important to have a good grasp about corporate litigation to preempt any litigation you might take against other corporations or defend your position in the case files a case or sues you.
Defining a Corporate
Before we tell you, what is corporate litigation, let’s define a corporate first. In law terms, a business becomes a ‘corporation’ when it is incorporated as a corporation. Which is the legal process needed to form a corporate entity or business. After a business is incorporated into a corporation, it is treated as a separate person under the law and is very distinct from its owners.
Two of the most important characteristics that you need to know about a corporation is that is treated a person and that of limited liability.
Under the law, a corporation is treated as a person and can own assets, sue or be sued, needed to pay taxes and such. It also has limited liability for its shareholder. Meaning that its shareholders are not liable for its debts.
What is Corporate Litigation?
Corporate litigation is, therefore, taking legal actions against a corporation. This process does not only include the act of prosecuting a corporation. But also involves measures that are needed to prepare and also avoid litigation altogether.
There can be different types of corporate litigation cases that a business may face. Some of them are:
- Shareholder and/or partnership disputes
- Intellectual property cases and litigation
- A breach of contract
- Fraud cases
Be sure to check out: Federal Withholding
Do You Need a Corporate Lawyer?
A corporate litigation lawyer is a term that is mostly used by lawyers and business firms to address a person who is specialized in writing, defending or arguing a lawsuit.
These types of highly skilled lawyers are not the same as transactional business lawyers/attorneys, who are mostly specialized in creating companies, moving around assets, creating contracts or helping their clients in buying and selling companies.
So, when is the right time to hire a corporate litigator? The rule of thumb for this is if you are searching for a lawyer after you have been sued it is already too late. Having a good lawyer at your side will give you access to important advice regarding the compliance of your company.
You will also need someone to look over the taxes and other legal aspects of the business. All in all, it is the best idea to get a hold of a lawyer or a law firm in the earlier stages.
Difference Between Corporate Law and Corporate Litigation
Some might confuse between corporate law and corporate litigation. Worry not, that is somewhat common who might know the nuance difference between the two. Let’s break these down.
As we have mentioned before, corporations need to operate under certain laws that apply to them since they are treated as a separate legal entity. Thus corporate law deals with the laws that involve such things as formations of corporations, other businesses, tax organizations, dealing with different levels of government and even the public.
Corporate litigation on the other hand deals with cases filed against corporations and businesses and taking them to court to resolve the dispute. This is also the part where a litigation lawyer comes in.
Litigation lawyers will act in the best interest of their clients and the case of a lawsuit, both parties will try to negotiate and come to a settlement. If that does not work, then the case is taken to court as a last resort’s
Q. How can I prepare before I bring in an attorney for a case?
Ans. As a measure of good practice, preparing beforehand an attorney is onboarded. There are some things you can prepare which makes it easier for the attorney to quickly grasp the problem. The scope of the case and what further steps can be taken.
Try to have all the relevant documents on hand and have a chronologically ordered list of events. This will include what, when and why a case was filed and also who knew about it and what has been done so far.
Q. What are the mistakes I want to avoid as a business owner?
Ans. Running a business is hard, we understand that around here. You need to juggle a lot of things at once and it can get very daunting very fast. One of the most common mistakes we see business owners makes is not having a lawyer read through or review a contract. You always want a competent lawyer to review contracts before signing them. Another mistake is not to have the obligations written down and having critical documents safely put away and organized. Creating backups of these is also a great idea.
Q. How much will it cost to hire a lawyer for a case?
Ans. Every case is different. Most law firms or lawyers will charge you by the hour and you might have to pay a retainer fee initially. The actual cost of fighting the case will eventually depend on the scope of the case itself.
Corporate litigation can get somewhat complex and technical If we dig in deep. But having some knowledge of it will always come in handy and get you on the right track if you are running a business or even if you are a law student and are looking to be a corporate litigation lawyer.
Don’t forget to check out: Exempt: Clarify Your Confusions