The Dos and Don’ts of a Corporate Business Dispute

As noted in our previous blog, the best way to prevent a corporate business dispute is to prepare for it with your partners. But, that doesn’t always happen, and when a disagreement occurs, things can get ugly, fast. If you’re in the beginnings of a dispute, how do you prepare for it and weather through with success? Holmquist & Gardiner provide some essential Do’s (and one Don’t) based on years of experience both inside and outside the court room.

DO identify your goals.

Before moving forward with a dispute, ask yourself what you really want out of it. What do you want to achieve? Maybe you want to sell your shares, recuperate losses, or completely shut down business operations. Identify your ideal end game and write it down. When you’re faced with a big decision during the process, refer back to these original goals, it will help.

DO try to work it out before you bring in legal counsel.

Legal counsel is pricey, and a long, drawn out dispute that ends in litigation can quickly drain your bank account. Before engaging with an attorney, see if you can work it out with your partner(s) solo. Grab a beer and hash things out on the back of a cocktail napkin. Then take whatever you agreed upon to an attorney for its formalization - that’s the cost-effective way to resolve a dispute.

If you’re beyond civility, but still working with rational parties, consider mediation. Propose that all partners enter into the mediation voluntarily to see if a resolution can be reached with the help of a professional. The mediator, or independent party, ensures a fair and reasonable discussion that could be equitably resolved. This can be done with or without legal counsel present (though we recommend you work with an attorney) and is a great first step to finding a resolution that doesn’t require litigation.

DO gather data.

If you’re in a business dispute, nine times out of ten it’s over money. Someone is taking money, was paid too much, or paid too little - you name it, we’ve seen it. To present a viable case, be sure to gather all data associated with the financial dispute. This includes emails, notes, texts, calls, etc., and if you have access to bank records, get copies of all statements, check copies and other account information. Create a timeline of events and begin writing down everything that happened and when. We tend to tell our clients, “Your memory is not what it was 3 months ago when the event occurred, but it’s better today than it will be three months from now.” In other words, if you haven’t gotten things down in writing, do it immediately. Also, be sure to review your corporate documents and data, including any meeting minutes, agreements, business plans., etc. Really anything you’ve put together for the company as a partnership can be used for or against you, so get up to speed on what those documents say.

DO keep it professional.

The person you’re in a dispute with may very well have been your best friend, and that’s hard to deal with, and even harder to prevent your emotions from taking hold. Remember, keep it professional and take the high road as much as possible. Relate your arguments to data and statistics and keep what’s in the best interest of your business top of mind. Try to look at things from a rational standpoint and think about what’s best in long run. It’s easier said than done, but in this case, yelling will get you nowhere fast.

DON’T make any drastic or rash decisions.

This is really important. From an outsider’s perspective, your company should be “business as usual.” Do your best to maintain status quo and refrain from harming the company’s reputation. Continue operating, letting your employees and business forge ahead, and don’t let the dispute impact the overall success of the company. As much as your emotions may tell you to give the dispute all you’ve got, draining your company’s bank accounts and liquifying assets to win a case is no way to win at all. When you do that, everyone loses, especially your employees.

If you’re really not sure what to do – talk it out, mediate, litigate – come talk to us. The attorneys at Holmquist & Gardiner have been through this countless times. That isn’t to say we don’t view each situation as unique, rather, we bring a certain level of experience that can help those involved in a heated dispute make rational decisions. Attorneys who specialize in business disputes can help clients walk-through real-life scenarios, we can tell you how it’s most likely going to play out in court, and work to get all parties on the same page, understanding what all possible outcomes are.

As a Seattle law firm specializing in business disputes, our approach is based on level-headed, rational thinking. We’ve seen the ever-popular bull dog approach to litigation play out many times, and it will often do more harm than good. We can come in growling when that’s the best option for your case, but we also understand the reality of how businesses function, and we don’t want to see a client throwing good money at something that could be resolved through mediation or simply talking it out with their partners. To put it simply, if there’s no reason to escalate, we aren’t going to do it. Why? Because we have our client’s best interests in mind and believe that cooler heads are going to prevail.

Can we litigate? Certainly – and we’re very good at it. Our main goal though, is to advise our clients on how to get the best possible outcome with an efficient use of everyone’s time and resources. That’s just how we operate.

To learn more, contact the attorneys at Holmquist and Gardiner anytime.