Bust A Deal? Face The Wheel!

Civil Litigation FAQs for the Business Owner

by Samantha L. Dammer | Contributor

When you are a business owner facing litigation, it can be intimidating regardless of whether you are the plaintiff or defendant.  If you have to sue because someone is not paying your bills for goods or services, it can be a very frustrating experience.  By the same token, when a business is served with a civil lawsuit it can be scary, whether the cause of action is breach of contract, trademark infringement, violation of a non-compete agreement, or some other business tort.

Of course we see these issues on a daily basis, but here are some common questions that we are asked from new business dispute clients.

Q:  What Happens First?

A:  A civil action starts with the filing of an initial complaint.  In the complaint, the plaintiff will state the cause of action and what sort of relief it is looking to achieve.  Here are some common causes of action, and relief requested:

• Breach of contract
  • Refund of money paid
  • Specific performance (this means that the other side must honor the contract)
  • Money damages
• Violation of non-compete agreement
  • Injunctive relief
  • Restraining order
  • Money damages
  • Declaratory judgment
• Collection case
  • Money
  • Return of equipment
• Trademark infringement
  • Injunction
  • Money damages

Q:  How long will the case take?

A:  A civil case can take anywhere from a few weeks to several years to resolve. Why such a wide window? Here are the factors that will determine the length of the case:

• Factual complexities
  • Is there a need for written “discovery” and depositions?
  • What sort of evidence will be produced at trial?
  • Are there many witnesses, or it is “your word against his?”
• Emotional maturity of the parties
  • Divorcing couples have been known to fight years and spend $100K over a $100 issue…business owners can act the same way in a business dispute.
  • Start-up founders might have an emotional attachment to their creation.
  • Non-compete issues are wrought with allegations or wrong-doings on each side.
• What court are you in?
  • Federal district court
  • Circuit court civil
  • County court/small claims

Q:  How much will it cost?

A:  See answer immediately above, which basically means “I don’t know.”  To prepare yourself from “sticker shock” when you meet with your attorney for the first time, you can find most “hard costs” online by going to your local court’s website.  In Florida, most civil courts charge a filing fee of around $300-400, and the defendant is not charged a filing fee to respond.  However, in other states such as Illinois, the defendant might have to pay a court filing fee to respond to a complaint.  In addition to the court costs, there are other “hard costs” for process servers, court reporters, expert witness and investigative fees.  Keep in mind that this is all above and beyond the attorneys fees which can be anywhere from $200-500 per hour.

Q:  Can I collect attorney fees from the other side?

A:  Maybe.  In most states, you can collect attorney fees from the other side if it is allowed in your contract or by statute. A good business contract will include a clause that states that the prevailing party can collect attorney fees and costs from the other party. Otherwise you need a state statute to authorize attorney fees. This is common with certain causes of action such as fair debt collection and consumer fraud matters.

The above information is general information, and is not intended to provide legal advice to a specific situation.  Please consult an attorney for additional information and clarification specific to your issue.

Samantha L. Dammer is a Florida attorney.  She is a member of the Tampa Bay Bankruptcy Bar Association and the Hillsborough County Bar Association and she has practiced law since 1998 (admitted to Florida Bar 2007).  The information and materials in this article are provided for general informational purposes only and are not intended to be legal advice.  No attorney-client relationship is formed.  Nothing in this article is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.