Is it Always Best to Litigate a Business Dispute?

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Legal disputes can threaten your bottom line, image, and relationships. As such, many business owners feel inclined to take aggressive steps to resolve them through means other than involving the courts.

Litigating a business dispute in Minnesota can be effective, but there are benefits to alternative methods of dispute resolution that business owners are wise to consider. Below, we look at four primary reasons why alternative dispute resolution (“ADR”) can be the more preferable route.

  1. Saving money – ADR methods like mediation and arbitration can be less costly than litigation. Using ADR can avoid court filing fees, greater attorney fees generated by motion practice, and expert witness fees.
  2. Saving time – ADR can also save quite a bit of time. Instead of having to work around the court’s schedule, parties can keep the process moving at their own pace, which is often much faster than the court system. Trials are typically set about one-year post-filing. ADR often happens at six months and sometimes earlier. The parties can even voluntarily engage in ADR before filing anything with the court.
  3. Preserving company resources – In complex litigation, business resources — financial and otherwise — can shift to the legal process. Instead of focusing on the priorities of the company, leaders and managers might focus singularly on tracking down documentation and making statements. As money is redirected from business goals to litigation goals, the workplace productivity and morale can be disrupted.
  4. Preserving a company’s privacy and reputation – Legal matters resolved through ADR are confidential, allowing parties to speak openly and disclose sensitive information, if necessary. Furthermore, public court battles can invite intense scrutiny and opinions from outside parties, including customers and other businesses.

While it may not always be possible to resolve a business dispute out of court, it is usually worth the attempt. Business owners who are facing a dispute with another company, an employee, or an outside iindividual should discuss the various approaches to resolving a legal matter with an experienced attorney.

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