Category: Business Law

What Are the Benefits of Entering a Business Partnership?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green Represent Business Owners Who Need Help with Business Contracts or Disputes.

Entering a business partnership could be the best or worst decision you have ever made. Much depends on the size of your business, your financial situation, who your partner is, and much more. Therefore, before you take the plunge, you should weigh out the possible advantages and disadvantages of what a business partnership could mean to you and your business.

What Are the Advantages of a Business Partnership?

It is time to expand your business, but you have neither the cash nor the borrowing power to take your business to the next level. By entering into a business partnership, you could accomplish what you envision.

Adding a partner could give you more cash and credit to expand. It also gives you someone with whom you can share the financial burden. Of course, adding more knowledge and expertise to the business is always a plus, and adding to your list of contacts can help you as well.

A partnership brings with it another perspective, not to mention a support system that might otherwise not exist. Perhaps the best advantage of a partnership is the tax advantages. Although a partnership will have to file income, gains, losses, and deductions, it allows the taxes to move through the business and onto the individual partners. The partners, in turn, will claim the profits and losses on their personal tax forms.

Although a business partnership can help you expand, there are disadvantages to consider. In a general partnership, your decision making is no longer your own. Although a partner shares the financial burden with you, profits are also shared. Moreover, you are responsible for your partner’s debts and bad decision-making.

A possible conflict of interest is especially important to consider. Having different opinions about how the company will operate going forward is often a problem and could create unwanted tension. The idea of expanding or selling the business, for instance, could become an inextricable web of complications.

What Types of Business Partnerships Should I Consider?

There are different types of business partnerships. The most basic is a general business partnership. The owners, according to each percentage owned, most commonly 50 percent, share profits and losses, as well as any debts, liabilities, etc.

A limited partnership is best for businesses with one main owner, having co-owners with a smaller stake and/or say. A limited liability company partnership (LLC) helps to protect owners’ personal assets in case of a lawsuit. A limited liability partnership (LLP) is designed to exempt individual owners from the business debts and irresponsible actions of co-owners.

What Is Good Advice to Consider Before Entering into a Business Partnership?

Carefully consider whether or not you really need a partner. Think critically about the most obvious issues. You will not only be giving up full ownership, but you will also have to include a partner in every decision, one way or another. In other words, despite the type of partnership it is, you will have to answer to someone in some way about the operations of the business.

If you decide adding a partner is a must, carefully choose your partner, and do not be in a hurry to do so. Be certain that you are both on the same page in regard to every aspect of the business, from operations to expansion.

Another important element to consider is adding someone who can complement you. For instance, choose someone who has a different skill set. Most importantly, take the time to have a detailed partnership agreement made up.

An exit agreement, for instance, is critical. You should also determine how to allocate profits, share losses, and resolve disputes. Remember that without a carefully-constructed agreement, your business will have to follow the default rules of your state in the case of a dispute between you and your partner[s].

Philadelphia Business Lawyers at Sidkoff, Pincus & Green Represent Business Owners Who Need Help with Business Contracts or Disputes.

If you need help with a business contract or any issue regarding your business, having a competent lawyer will make all the difference. To help you in any business matter, speak with our experienced Philadelphia business lawyers at Sidkoff, Pincus & Green. Call us at 215-574-0600 or contact us online for a free consultation. Located in Philadelphia, we serve clients throughout Pennsylvania   and New Jersey.

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How Do Non-Disclosure Agreements Work?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Assist Clients Regarding Non-Disclosure Agreements.

Non-disclosure agreements (NDAs) are legally binding confidentiality contracts regarding the sharing of sensitive business, financial, or proprietary information with others outside the agreement. NDAs are common when businesses negotiate with other businesses, firms, or individuals requiring confidentiality of the information and data shared among the parties during the process.

In business dealings non-disclosure agreements are common, especially when entering partnerships, hiring employees, or obtaining investors that require sharing sensitive information. An NDA provides confidentiality and security over the. Situations requiring an NDA may include:

  • Mergers and acquisitions: When companies combine, purchase, or sell, sensitive financial and operational information must be shared among all parties involved, including brokers and intermediaries. Organizations choose to enter into NDAs in order to protect their information and ensure confidentiality.
  • Products: NDAs are crucial when licensing or selling new products or technology to protect the spreading of proprietary, technical, and financial information outside the entities involved in the sale or licensing.
  • Partnerships: When entering into new partnerships or securing investors, NDAs are essential to protect information shared during negotiations.
  • Employees: It is also crucial for some organizations to require confidentiality among the employees regarding the sharing of sensitive data, financial or proprietary information, and business practices.
  • Clients: An NDA protects organizations from the spread of sensitive information when acquiring new clients to prevent accidental exposure that could result in legal liabilities.

What Information Should Be Included in an NDA?

Though each NDA is unique based on an organization’s needs, there are essential elements typically included in confidentiality agreements, such as:

  • Identification: Identify and detail the parties included in the agreement, which parties are disclosing and receiving, business partners, accountants, attorneys, and any others associated with the NDA, including names and contact information for all.
  • Definitions: Detail what information is to be held confidential and protected by the NDA, and rules regarding the use of said information.
  • Scope: One of the more crucial parts of an NDA, the scope clearly defines how the NDA will be enforced and specifically details on what information is protected under the agreement.
  • Obligations: This section details what is expected of those who sign the contract and the consequences if the participants violate the agreement.
  • Time limit: NDAs are generally not permanent and should specify the length of time participants are bound to uphold the terms of the agreement, as well as specify when that period will end.
  • Information return: Depending on the scope of business and what information is covered under the NDA, some agreements include a section requiring the parties to confirm that the information they were privy to has been returned or destroyed.
  • Remedies: This section details what actions will take place for breaches of the agreement. Typical consequences involve restraining orders, monetary fines, with additional actions for breaching fiduciary, copyright, patent, or trademark infringements.
  • Exclusions: As with any business contract, there can be exclusions to NDAs as well, typically information that does not require confidentiality. These may include previously disclosed information, prior knowledge of business or financial information among the parties, or information that is public knowledge.

When entering an NDA, review if carefully and understand what is expected of you. Ask questions, voice concerns, and request clarifications if you uncomfortable or disagree with the terms. Never sign a contract that you do not agree with or fully understand.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Assist Clients Regarding Non-Disclosure Agreements

If your business is planning to merge or acquire another business, entering a partnership, or recruiting investors, you are likely going to need to develop non-disclosure agreements to protect your sensitive and proprietary information. Our experienced Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. can assist in developing the agreement. Contact us online or call 215-574-0600 for an initial consultation. Located in Philadelphia, we also serve clients in New Jersey and Pennsylvania.

Can Executives Negotiate Their Severance Packages?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Help Clients to Get Severance.

Parting ways with your longtime employer does not necessarily mean your income from that employer ends with your employment. A severance package often makes it possible for a valued worker to part ways with no animosity.

A severance agreement usually includes specific legal agreements that stipulate that, in exchange for accepting the severance package, the former employee cannot make negative comments about their former employer. Accepting the severance also usually means giving up any right to sue the former employer for any reason.

A severance package could bridge the income gap between jobs. If you find one right away, you still get to collect your severance pay.

How that severance is paid, the amount, and its duration all are important to take into consideration when accepting a severance package. These various factors can affect your life for the foreseeable future, so it is important to negotiate a severance package prior to parting ways with an employer.

Factors to Consider During Severance Negotiations

It helps to consider what you need versus what you are offered for severance. Overlooking important needs could create an unintended hardship.

For most people, the most important factors to consider when negotiating a severance agreement could include:

  • Extending benefits through the severance period
  • Handling retirement packages and incentives
  • Mutual non-disclosure agreements
  • Whether you need to return or laptop computer or other work items

You likely will want to maintain your health insurance benefits and have the employer continue deducting any pay for health care benefits. If you have a 401k or another retirement package, rolling it over or accepting a payout is very important.

If you were issued a laptop or other equipment to keep at home so that you could do your job, you might be able to keep it. Non-disclosure agreements could ensure that neither you nor the soon-to-be-former employer make disparaging remarks about the other party or file any lawsuits.

When Severance Negotiations Could Start?

Severance negotiations usually begin when your job is about to end. Most people have a good idea whether or not their jobs might end soon. In such cases, notification that the job is ending and severance is offered is not surprising, but it still could be upsetting.

The potentially emotional nature of exiting a job might encourage you to accept a severance upon receiving the offer. That would be the first severance negotiations mistake that you could make.

Instead of accepting right away, you should tell the employer that you need to review the offer. No law requires employers to offer severance packages, and you are not obligated to accept one.

Standard practice is to allow you up to 21 days to review the document and accept or reject it. If you accept it and change your mind, you usually have seven days to revoke the acceptance. You can make a counteroffer and negotiate the severance regarding payment and any other items of importance to you.

How Severance Affects Unemployment Benefits?

If you accept severance pay, you cannot file for unemployment until the severance pay expires. The state views severance as an extension of employment.

Your first true day of unemployment is when the severance agreement expires, and no more money is due to you from your former employer. Once that final date specified by your severance package arrives, you can apply for unemployment benefits the next day. Filing sooner than that would violate state law.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Help Clients to Get Severance

If you are facing employment termination and want to negotiate a severance agreement, the experienced Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. can help. You can call 215-574-0600 or contact us online to schedule an initial consultation at our Philadelphia law office. We represent clients throughout Pennsylvania and New Jersey.

Should I Start an LLC or a Corporation?

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Learn More from Experienced Business Lawyers in Philadelphia at Sidkoff, Pincus & Green.

Whether you provide consumers with goods, or clients with services, liability is an ever-present issue in businesses of all sizes. You might start a business, but have not made it a separate legal entity. If so, you could be liable for damages arising from any harm caused by the goods or services that you provide.

There are two effective ways to handle potential liability from your business activities. One is to create a limited liability corporation (LLC), and the other is to create a corporation. An LLC and a corporation have their own advantages. The following could help you to choose which would be best for your business ambitions.

Pros for Creating a Business Entity

An LLC and a corporation are similar in that they create legal entities. Those legal entities enable you to protect your personal assets by making them wholly separate from your business activities.

A medical doctor or an attorney who enters into private practice are good examples of people who provide services that could raise liability issues. Creating an LLC or a corporation for a private practice helps to limit liability to only those entities.

You could appoint yourself as the president and CEO of your LLC or corporation, paying yourself a regular salary and annual bonuses. Once that money is in your account, it is separated from your business activities.

Sole Proprietorship Makes You Vulnerable to Business Liability

Without an LLC or a corporation, you are operating what is called a “sole proprietorship,” which is one way to say that you work for yourself while providing goods or services to others.

A sole proprietorship does not protect your personal assets against liability that might arise from business practices. You could lose your life savings, home, and other assets if a customer or a client were to sue you and win a large settlement in court.

If you have an LLC or a corporate structure, the liability would not extend to your personal assets: instead, you could obtain business insurance that helps to cover the costs of liability if any issues were to arise.

Advantages of an LLC

An LLC is a simple and affordable way to create a legal business entity. An LLC might have more than one owner, but the ownership structure is small and reduces the amount of paperwork that you would have to file each year.

An LLC enables greater flexibility for management. You can change the management structure without enduring complicated legal filings or extensive paperwork.

An LLC also has a tax advantage over corporations. That is because the federal government does not tax the profits of LLCs like it does corporations. The profits from LLC entities go straight to the owners. And those owners pay taxes on their respective incomes.

An LLC does not have to endure complicated tax filings like a corporation does. It also does not require the kind of specialized accounting assistance and legal help that a corporation often requires to file and pay its annual taxes.

Disadvantages of an LLC

An LLC needs to turn a profit for its owners to make money. If a bad year results in no profits, then there is no pay for the owners.

An LLC requires its owners to have other sources of income. Or the owners need to be very frugal with the profits that they obtain during profitable years.

A strong business model and quality goods or services can help to overcome the potential for business losses. But you never know with something unexpected might occur – like a global pandemic that triggers statewide lockdowns.

An LLC also leaves its owners vulnerable to criminal allegations arising from potentially unlawful business dealings. Just as the profits flow straight to the owners, so does accountability for any criminal acts that might occur.

How to Create a Pennsylvania LLC?

It is relatively simple and affordable to create an LLC in Pennsylvania. You just need to file a Certificate of Organization and a docketing statement with the Bureau of Corporations and Charitable Organizations.

You could complete the paperwork yourself and pay the requisite fees to make your LLC a reality. But it can help to have experienced business lawyers in Philadelphia assist with the filing and its subtle legal matters.

Advantages of a Corporation

A corporation can control excess profits and use them to reinvest in the goods or services provided to customers or clients. The corporation also can use the excess profits to reward its shareholders. If a loss occurs, that also could be passed on to shareholders, though the president, CEO, and other executives and managers still can be paid salaries during years when losses occur. Forming a corporation helps to ensure some level of income even during bad years.

A corporation also provides your business entity the opportunity to eventually go public. You could list shares on a stock exchange and raise capital to fund your business ventures.

Disadvantages of a Corporation

You already know that a corporation has a more complicated creation process than an LLC, with the added irritation of dealing with annual corporate taxes. It is beneficial in many ways to enlist the help of experienced business attorneys and accountants.

Even if you are just a shareholder in a corporation, you could suffer financial losses during a bad year: if the corporation goes bankrupt, the shares become worthless. That partly is why the federal government has bailed out corporations in the past to help prevent them from filing for bankruptcy.

How to Create a Pennsylvania Corporation?

It takes more legwork and effort to incorporate in Pennsylvania and other states. You need to choose a corporate name that is unique, and readily identifiable when compared to other corporations.

The corporation must have an address and a registered agent. The registered agent could be an individual, such as a business attorney, who has a legal address in Pennsylvania. The agent also could be a business entity that can do business in Pennsylvania.

You will need to create corporate bylaws and appoint directors. After doing that, you can hold your first board meeting to officially name directors and adopt the bylaws.

You can file the articles of incorporation at the Pennsylvania Department of State. Afterward, you need to issue shares to your shareholders. Then you are a true corporation that might go public in the future.

Learn More from Experienced Business Lawyers in Philadelphia at Sidkoff, Pincus & Green

The experienced Philadelphia business lawyers at Sidkoff, Pincus & Green can help you choose and organize an LLC or a corporation in Pennsylvania. You can call 215-574-0600 or contact us online to schedule an initial consultation at our Philadelphia law office. We represent clients throughout Pennsylvania and New Jersey.

Can I Get Out of a Business Contract?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You With a Business Contract.

A business contract between parties that is written and signed is a legally enforceable document. Signees generally cannot just leave the arrangement or void the contract at will.

In business, situations can change, and unforeseen circumstances can render one or both parties unable to honor their initial contractual agreements. Unfortunately, there are situations where one party purposely makes it difficult for the other to honor the contract.

A party can sometimes legally void their business agreement. Most of the time, breaching a contract comes with stiff financial penalties, legal costs, and possibly even litigation.

That is why it is important to have a business lawyer review a contract before it is signed. They may recommend including an escape clause in the agreement. This type of clause allows a party to terminate an agreement under certain predefined conditions lawfully.

If your contract did not have a termination clause, you might be able to still get out of the contract. There are some circumstances under which signees can void their agreement. It will still require legal action and an experienced lawyer.

Legally permissible reasons to void a business contract include the following.

Breach of Contract

If two or more parties sign a business contract and one signee unlawfully breaches the agreement, the other parties may not be required to fulfill their contractual obligations. The alleged breach must be proved in court. In a legal sense, a breach occurs when a party acts contrary to contract terms, refuses to maintain its contractual obligations, or prevents other parties from fulfilling their responsibilities.

Incapacity or Death

Contracts are typically nullified if a signee becomes incapacitated. This stipulation should be written into the contract terms. Generally, if a signee is deemed mentally incapable of maintaining the agreement, they are excused from the legal consequences of premature contract termination. In addition, deceased individuals are not held accountable to contract terms.

Fraud or Misrepresentation

If the contract is found to have been based on fraudulent or misrepresented information, the party experiencing the fraud or misrepresentation will have to prove it in court to void the contract. This process can be time-consuming and costly.

Impossible to Fulfill

If fulfilling your contractual obligation is deemed impossible, the contract can be lawfully terminated. However, the circumstances for voiding a contract for “impossibility to perform” are rare. Death and incapacity are legitimate reasons for making a contract impossible to perform. Traumatic and unexpected events, such as car accidents or natural disasters, may also be found legitimate reasons for making a business contract impossible to fulfill.

As stated previously, the best way to get out of a business contract is to have a termination clause built into the agreement, with predefined conditions that are reasonable and realistic. If that is not the case, a calm sit-down discussion involving all parties, led by an experienced lawyer, can result in negotiations and solutions fair to both parties.

Sometimes, it could even be as simple as asking the other party to allow you to void the contract. Smart business owners know that goodwill between business partners is worth more than going to court for a breach of contract. It may be possible to get out of your business contract for a fee or possibly for free. Let your lawyer lead the way.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You With a Business Contract

Our Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. help businesses function smoothly and effectively under the law. If you are a business owner and need help with a contract or other legal matters, contact us online or call us at 215-574-0600 today. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

What Qualifies as a Business Tort?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You With Business Tort Litigation.

Whenever a conflict arises that causes harm to a business, a business tort could exist. Many business conflicts could endanger your business. The harm could be financial and threaten to close your business. The harm might even be the theft of trade secrets.

A business tort always involves the economic effects of wrongful acts that impact one or more businesses or other legal entities. Many begin with contract disputes that two or more parties cannot resolve. Then, lawsuits get filed in federal or state civil courts and sometimes both.

The plaintiff in a business tort must cite at least one cause of action for the lawsuit to proceed. A cause of action is comprised of legal facts that justify the lawsuit. Most business torts involve one or more of the following causes of action:

  • Tortious interference.
  • Injurious falsehood.
  • Restraint of trade.
  • Unfair competition.
  • Fraudulent misrepresentation.

Other causes of action also exist, and most business torts involve a combination. The plaintiff usually seeks a judgment for cash, property, or affirmation of a legal right.

Tortious Interference Affects Prior Business Relationships

Tortious interference happens when an offending party interferes with a business’ contractual relationships with others. The offending party might make it impossible for your business to complete a contractual obligation. When your business cannot perform its obligations, tortious interference might be a valid cause of action in a lawsuit.

Injurious Falsehood Explained

You likely understand the general concept of defamation. If another party spreads a malicious lie that damages your business’ brand reputation, an injurious falsehood occurs. Malice must be shown and refers to intentionally spreading a known falsehood with the intent to cause damage to your business’ brand reputation.

How Restraint of Trade Could Occur?

When an offending party does something that limits your amount of trade, sales, or delivery of goods or services, a restraint of trade happens. Whenever your business cannot continue normal operations due to the actions of other parties, a restraint of trade might be claimed as a cause of action.

Many Kinds of Unfair Competition

Unfair competition has potentially widely varying actions that could result in the cause of action triggering a civil suit. Stealing your trade secrets or using your intellectual property to siphon away some of your market shares are examples of unfair competition. The unfair competition gives the offending party greater leverage to generate profit at your expense.

Fraudulent Misrepresentation Could Void Contracts

When one party intentionally lies in order to secure a business agreement, that is a form of fraudulent misrepresentation. The misrepresentation is done with the intent to deceive a business or an individual. It might involve contractual negotiations or other business dealings and could occur in many ways, including the omission of information.

Punitive Damages Might Be Sought

When a malicious act creates one or more legitimate causes of action that you could prove in court, the defendant might be subject to punitive damages. You would have to request punitive damages in a court filing or amend an existing case to request them. However, it is important to note that punitive damages are rare.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You With Business Tort Litigation

Our Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. can help you explore your legal options when you must resolve a business dispute. Call us at 215-574-0600 or contact us online to schedule an initial consultation. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

What Should I Do if I Find an Error in My Business Contract?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You if You Have an Issue With Your Business Contract.

Most business contracts are complex, containing dozens of sections, sub-sections, and countless provisions detailing the requirements by both parties. Miscommunications could happen and something could be put in writing that should not have been. Also, there could be simple typos that happen when a contract is long. It is possible that a simple typo could significantly change the meaning or terms of a contract. If the typo is not caught during a review of the final draft, the parties could be in a tough spot since both parties signed the document.

There are three main categories of mistakes that can happen in business contracts.

Unilateral Mistakes

This is where one side of the contract makes the mistake or misunderstands a term or provision within the contract. This is the most common mistake. There are a few ways a contract can be rescinded if a unilateral mistake has been made:

  • A drafting or clerical mistake that did not lead to gross negligence.
  • If the error was so serious and irrational to be outrageous.
  • If one party to the contract relied on a material fact that the other party knew was a mistake but failed to inform the other party.

The best way to make sure unilateral mistakes are not made is to hire an experienced lawyer who focuses their practice on drafting and negotiating business contracts.

Mutual Mistake

A mutual mistake is when both parties misunderstand a term or provision in the contract. Since both sides have made the mistake, the contract can usually be voided. However, there must be a material fact for a mutual mistake to be void.

Common Mistake

A common mistake occurs if both parties mistakenly believe or misunderstand similar facts. The issue at the heart of the mistake has to be a fundamental aspect of the contract.

How to Prevent Business Contract Mistakes?

You want to make sure you have a lawyer on your side. Make sure your lawyer understands the goals of the contract that is being agreed upon, as well as the minor issues. A good line of communication with your lawyer is extremely important so that there are no misunderstandings and that everyone is on the same page.

Review every line of the contract with your lawyer. If there are any questions, make sure to go over the language in detail to make sure you completely understand the purpose of each sentence.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You if You Have an Issue With Your Business Contract

If you need to have a business contract negotiated and drafted, it is important that you consult with a lawyer. Our Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. can help you explore your options. Call us at 215-574-0600 or contact us online to schedule an initial consultation. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

What Constitutes a Material Breach of Contract?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You With a Contract Breach.

At the heart of every contract are certain conditions that each party must follow. When one or more contractual parties does not abide by the obligations of the contract, a breach of that contract has occurred. There are four main types of contract breaches, and a material breach is the most serious. That is because a material breach permanently breaks the contract.

A material breach of contract causes irreparable damage that makes it impossible to continue the contract. The material breach refers to one or more parties failing to perform the contract. The breach goes to the very heart of the contract itself.

Suppose you have the architectural designs for a particular home that you want to build. You could pay a contractor to build it, but if the contractor builds a completely different home, a material breach of contract would have occurred. In this case, there likely would be no way to continue the contract.

Other Parties Must Be Ready, Willing, and Able

Ready, willing, and able are three important factors in claiming that a material breach of contract has occurred. If you are accusing another party of a material breach, you have to be ready, willing, and able to perform your end of the bargain.

If the contractual agreement were to build a home, you could show that you provided the architectural designs, land, and money to do the job reasonably and effectively. The homebuilder might continually delay or otherwise refuse to do the project as agreed. If so, you could make a strong case for a breach of contract. The homebuilder also could not erect or place a substandard home on the property and declare the contract fulfilled.

Did Bad Faith Play a Part in the Breach of the Contract?

If the breach of contract resulted from bad faith and the case is brought to court, they will likely presume it to be a material breach of contract. On the other hand, a breach that results from negligence is less likely to be considered a material breach. In this case, it would be considered a minor breach.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You With a Contract Breach

If another party has breached a contract you are a part of, speak with one of our experienced Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. Each party involved in a contract must meet certain obligations. We can help you if another party is not following through on their end of the contract. Call us at 215-574-0600 or contact us online to schedule an initial consultation today. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

What Should I Do if My Company Gets Sued?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help if Your Business Is Being Sued.

Businesses of all sizes and types are vulnerable to lawsuits. If the lawsuit progresses to a courtroom, there may be devastating effects on the company. It may hamper a business’s finances and funding, ability to operate normally, and even its reputation among customers and business partners.

Many smaller businesses do not have the luxury of in-house legal counsel. They may be taken by complete surprise when an employee, client, vendor, insurer, financial partner, or another party files a lawsuit against them. Common causes of business litigation include:

Act Quickly

Review the case with a trusted and experienced business lawyer. They can advise you on how they can help you respond. They may even find incorrect information from the start and move to dismiss the lawsuit. If information is correct, they will quickly put a preservation order in place to preserve relevant data, including documents and electronic materials.

As a business owner, you should never communicate directly with the person or entity that has filed the lawsuit to try and resolve the issue. Any words or actions can be held against you in litigation; always let a business lawyer speak on your behalf.

Inform Your Insurer of the Complaint

Most businesses have several different types of insurance policies to cover a variety of situations. They should immediately contact the appropriate insurer. Insurance will often cover costs, and the insurance company may also use its own counsel defense. Even so, the business should also keep its own counsel informed of proceedings.

Have Legal Counsel

A lawsuit usually comes with a requirement to submit a written response within 30 days or another timeframe. That is another reason to quickly hire legal counsel. The written response needs to come from a lawyer and must include:

  • Admittance or denial of each allegation.
  • Defense and counter/cross-claims against the plaintiff or other defendants.
  • Whether you want a jury trial or alternative resolution.

Before submitting the response, your lawyer will discuss with you options for resolution, insurance coverage, potential counterclaims, such as holding another party responsible, dismissals of all or part of a complaint, and other issues.

Tips for During and After the Case

As you and your legal counsel work toward negotiation or litigation, follow these tips to help ensure a successful process:

  • Be quiet: Do not discuss the case with anyone but legal counsel and those in the company who need to know.
  • Be honest: Do not hide any information or cover anything up. Your lawyer should never be surprised by new information.
  • Be prompt and diligent: Your lawyer will ask for a lot of information, and you must respond quickly to avoid delays.
  • Stay focused on your business: A lawsuit may be stressful, but it does not mean you are guilty of something. Let the appropriate parties decide that while you focus on running a good and ethical business.
  • Learn: If a lawsuit comes up, then review your employment-related practices, policies, handbooks, and management training. You should make changes where necessary.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help if Your Business Is Being Sued

Our Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. have the skill and knowledge to defend your business if you are being sued. We provide counsel on business conflicts and disputes involving employment, partnerships, contracts, and other related issues. For an initial consultation, contact us online or call us at 215-574-0600. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

How Should I Handle Business Disputes?

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You Resolve Business Disputes.

Business disputes will likely happen at some point, especially when there are high-value transactions involved. The more money that your business takes in, the more likely there will be internal or external disputes.

Business disputes should not cause duress unless they truly threaten your business and livelihood. There are many ways in which to handle the variety of business disputes that might arise. Most can resolve disputes outside of a courtroom. However, if business litigation is inevitable, an experienced lawyer will help you get the best possible outcome.

Additionally, many business disputes could be settled with the help of experienced third parties. A mediator could help two or more sides in a dispute to reach an amicable agreement that resolves the matter. An arbitrator could hear both sides of a business dispute and then render a decision by which both sides must abide.

Disputes with workers might have to go through the respective state agencies. They also might go through state or federal commissions tasked with handling such disputes. For example, if a worker files a discrimination claim, the federal Equal Employment Opportunity Commission (EEOC) would have to investigate before any kind of lawsuit might be filed against your business.

What Are Some Common Business Disputes?

Business disputes could be internal, external, or a combination of the two. The dispute might be with a business partner and one or more workers. It might be due to a contractual disagreement with another party. No matter the cause, the result usually means a negative impact on your business endeavors.

The four most commonly occurring business disputes include:

  • Partnership disagreements.
  • Disputes between two or more businesses.
  • Financial or contractual breaches.
  • Employment disagreements.

Partnership disagreements usually are the most common of all business disputes. Disagreements regarding business direction, finances, leadership changes, and hiring issues are common sources of partnership disputes. A breach of contract also might trigger an internal dispute among business partners.

Outside of the business, breaches of contract also commonly trigger legal disputes with other business entities. The breach might involve finances, products, or the improper delivery of services. Whatever the contractual obligation, external business disputes often arise.

Employment disputes often involve issues with pay or discrimination claims by one or more workers. Your business also might be on the receiving end of a discrimination complaint that may or may not have merit.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You Today

If you are in the midst of a business dispute, our Philadelphia business lawyers and Sidkoff, Pincus & Green P.C. can help you resolve the matter. Call us at 215-574-0600 or contact us online to schedule an initial consultation. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.