Running a business comes with its fair share of challenges, and one of the most daunting can be a lawsuit.
Understanding the most common types of business lawsuits can help you prepare and protect your company. Here are some of the most frequent legal issues small businesses encounter.
1. Breach of contract
Breach of contract occurs when one party fails to fulfill their obligations under a business contract. Whether it is a supplier failing to deliver goods or a client not paying for services rendered, these disputes can disrupt operations and lead to significant financial losses.
2. Employment disputes
Employment disputes cover a range of issues, including wrongful termination, discrimination and wage and hour violations. These lawsuits can arise when employees feel they were unfairly treated or fired without just cause.
3. Personal injury claims
These lawsuits often involve customers or others who get injured on business premises. Slip-and-fall accidents or other injuries that occur on the property can lead to costly lawsuits. Today, more than ever, consumers are aware of their legal rights after a premises injury.
4. Intellectual property issues
Modern businesses possess many forms of intellectual property, from trade secrets to patents and trademarks. Disputes can arise if someone steals or infringes upon your business’s intellectual property. Holding the person accountable can help you protect your business ideas and discoveries.
5. Shareholder disputes
Disputes among shareholders range from issues of mismanagement to conflicts over business direction. Whatever the cause, a shareholder dispute can impact your daily operations, business finances and even your reputation among consumers and other businesses.