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Being served with legal papers is never a pleasant experience. Knowing how to react and what steps to take can help make the process more bearable and improve the outcome in your favor.

  • Don’t overlook legal documents.  The documents may not come via the delivery method you would expect. The documents may come via registered mail, a delivery service, or courier, or through a visit from the sheriff’s deputy or a U.S. Marshal.
  • Read documents thoroughly.  The documents can appear in a variety of formats. You may receive an informal-looking civil warrant instead of the typical summons and complaint. In Tennessee, not responding to the civil warrant could cost you up to $25,000 in general sessions court or an unlimited amount if in almost any other court. Remember that documents vary by court and by county.
  • Don’t panic.  They are just documents. Check for the response date. You may have anywhere from 10 days to 30 or even 60 days to respond.
  • Not taking action is not an option.  You’ll need to do two things immediately: 1) If it’s a claim that may involve your insurance, notify your insurer in writing. 2) Get the documents to your lawyer. Get help whatever you do. If you don’t take steps to deal with the suit, there’s a 99% chance it will be dealt with unfavorably in your absence.
  • Fight the urge to be your own investigator or lawyer.  You may be tempted to talk to others to get to the bottom of the matter. Doing so may make your case weaker. Wait for instruction from your lawyer and/or insurer.
  • Preserve and organize relevant information.  Gather all documents that relate in any way to the matter. These may include contracts, bills, invoices, photographs, electronically stored files, receipts, or letters. Do not under any circumstance purge files or delete emails. No matter how harmful you think the files may be to your case, nothing will hinder your case more than missing pertinent files.

Common Claims Against Small Business Owners
The type of business you own will usually dictate the most common types of lawsuits you will face. In general, small business owners face three major categories of litigation:

  • Third-party claims.  These include personal injury claims and often an insurer.
  • Contract claims.  These include disputes with customers and vendors.
  • Employee claims.  These may include worker’s compensation claims, civil rights claims, discrimination claims, and other employee issues.

You may also face regulatory, licensure, or anti-trust issues, depending on the business you own.

How the Claim Gets Resolved
Every case can take a different course and pace depending on the nature of the claim, the court, and the case strategy. Below is a generalized description of how a lawsuit may proceed:

  • Response.  In all courts except general sessions there will be a written defense on your behalf.  Your lawyer will work with you to prepare a written defense. The time you have to respond varies depending on the jurisdiction. This written response sometimes includes a motion to dismiss the case.
  • Discovery.  If the case is not dismissed, both sides enter the discovery phase. The goal of discovery is to obtain information held by the other party that is relevant to the lawsuit. Methods used in discovery include:
    • Depositions.  Statements made under oath in response to oral examination or written questions and that is recorded by a court reporter.
    • Interrogatories.  Written questions that must be answered by the opposing party.
    • Requests for Production.  The other party is asked to produce specified documents or tangible things or provide permission to inspect land or property belonging to the other party.
  • Summary Judgment.  Either party can make a motion for summary judgment at various stages of the litigation process. A summary judgment means the judge looks at the facts, applies the law, and makes a ruling. The judge may determine that there is no need for a formal trial.
  • Trial.  There are two types of trials: a bench trial, which is heard by a judge, and a jury trial, which is heard by a jury. At the trial, the case is either dismissed or a judgment is rendered. The good news is that only a small percentage of cases make it to trial. Settlement discussions occur along the way, and most cases are resolved by motion or settlement before they make it to a courtroom.