Business litigation can be a costly and time-consuming process for any company.
The controversies at issue can represent an existential threat to the business engaged in the litigation.
Further, Texas business litigation law calls for specific processes that must be followed. These processes are rarely quick.
Fortunately, many companies can avoid litigation through proper planning and effective governance.
However, no company can completely mitigate the risk of being pulled into a costly court battle. Further, sometimes businesses must engage in litigation to protect their interests.
Since litigation can arise during the regular course of business, it is essential for business leaders to understand the business litigation process.
Below, the Austin, Texas business lawyers at Massingill will go over the process of business litigation lawsuits in Texas.
If you have any questions, please contact us today.
What Is Business Litigation in Texas
Business litigation is the process of resolving disputes involving businesses through the court system. There are a vast range of issues that can lead to business litigation.
Litigation can occur between two companies, an individual and a company, or even between individuals within the same company.
Businesses from any sector can find themselves in court litigating issues that can have severe repercussions.
For this reason, Texas business litigation attorneys must have a broad knowledge of common problems that arise throughout many business environments.
Reasons to Litigate Business Matters in Texas
There are many reasons that business litigation can become necessary. Common issues companies encounter that lead to litigation include:
- Employment disputes,
- Contract disputes,
- Product liability,
- Premises liability,
- Partnership disputes,
- Shareholder disputes,
- Insurance coverage issues,
- Zoning and land use regulations,
- Environmental regulations,
- Real estate disputes,
- Violations of fiduciary duties, and
- Allegations of fraud.
Any potential legal issue that affects a company can end up in commercial litigation.
Common Steps to Take Before Litigation
Even after issues arise, companies can take several steps to avoid litigation. There are often risks associated with litigation for everyone involved.
Sometimes the best solution for all parties is to resolve the issue outside of court.
Direct negotiations are often the first step in resolving disputes before involving the courts. Conflicting parties have a lot to gain by sitting down at the negotiating table with one another.
Counterparties can often find a solution to the problem that avoids the costs and risks associated with going to court.
If negotiation fails, arbitration or mediation can be viable solutions. In arbitration, both parties agree to have an arbitrator make a legally binding decision after examining the arguments and evidence.
In mediation, a mediator helps the parties resolve their disputes in a way that is satisfactory to everyone involved. Mediation is non-binding.
Texas business litigation lawyers can help facilitate each of these pre-litigation steps.
Process of Business Law Litigation
Unfortunately, litigation is sometimes completely unavoidable. Knowing the steps of business litigation is helpful for lawyers and business leaders alike.
Even Texas business litigation attorneys can struggle to keep up with the complicated and ever-changing Texas Rules of Civil Procedure.
However, understanding the basic process and knowing what to expect can help business leaders make beneficial decisions at every step.
Petition
Officially, business litigation begins when a plaintiff files a petition with the courts.
The petition will include information such as who the plaintiff is, who the defendant is, the cause of action, and a brief overview of the facts of the case.
Citation
Once the court receives a petition, it issues a citation or notice to the defendant. This notice needs to be served to the defendant.
The citation will inform the defendant that the lawsuit has been filed.
It will also give them a date by which a response must be filed and notify them that a default judgment will be rendered if no response is provided.
Response
Next, the defendant will file a response with the court. Usually, the response should either reply to every element of the complaint or file a motion to dismiss.
If the court receives a motion to dismiss, a judge will initially decide if the claims are substantial enough to proceed. If not, the judge will dismiss the case outright.
Discovery
If the case is not dismissed, the court will order both parties to attend an initial court appearance.
The timeline for the rest of the litigation process will be set during this appearance. After this court date, the discovery phase begins.
The discovery phase is when the parties share information and collect evidence to prove or disprove the claims.
Witness depositions, document requests, written questions and answers, and other forms of evidence collection happen during the discovery process.
The discovery phase can be the trial’s longest phase, lasting anywhere from a few weeks to multiple years.
Mediation
Mediation is not a part of every business litigation lawsuit. However, sometimes the court mandates that the parties go through a mediation process before conducting a full trial.
During a mediation process, a mediator will attempt to get both parties to agree to a settlement.
Trial
During the trial, both parties present their evidence to either a jury or a judge. After the long process that happens beforehand, the trial can move relatively quickly.
Judgment
At the end of the trial, either the judge or the jury will issue their final judgment. This final ruling will dictate the outcome of the litigation.
Appeals
If a party disagrees with the verdict, they can appeal the decision to a higher court. Appeals can add significant time and cost to the business litigation process.
How a Texas Business Litigation Lawyer at Massingill Can Help
If you have questions about Texas business litigation law, Massingill knows how to help.
We can save you time and money by quickly resolving business disputes without expensive litigation.
If litigation is necessary, our skilled business law attorneys can provide effective representation throughout the entire process.
The experienced lawyers at Massingill understand how to simplify complex legal issues into approachable concepts.
We handle the critical details, so our clients can stay focused on the bigger picture. Contact Massingill today, and we can help with all your business litigation needs.
Joshua Massingill
Joshua Massingill is an attorney practicing in Austin, Texas. He serves on the Texas State Bar’s Law Practice Management Committee, the Leander Educational Excellence Foundation (LEEF) Board of Directors, and the Success-Werx Board of Advisors. He mentors young entrepreneurs in Leander ISD’s INCubatorEDU program and is active in his church.
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