While it may seem simple, the age-old maxim “put everything in writing” continues to prove invaluable. Nothing is better at preventing lawsuits than a well-drafted contract, memorandum of understanding, memo to file or any other writing that records an agreement or important event. Documents are far-and-away the best tools for managing parties’ expectations and memorializing material events.
2. Develop a Comprehensive Employee Handbook
Employee-related litigation is by far the most common type of litigation faced by small businesses. One of the best ways to avoid an employee-related lawsuit, according to Mr. Cueto, is to develop a comprehensive employee handbook. Your employee handbook should contain all essential employee issues, such as the employer’s right to terminate employees, maternity-leave rights, confidentiality, sick leave, vacation, sexual harassment, etc.
The owner and each manager should be intimately familiar with the rights of employees in these areas. If you comply with the handbook and the rules regarding employees’ rights, employees should be discouraged from suing you, or you should have the upper hand if they do.
3. Protect Your Intellectual Property
Every business has intellectual property (IP). Whether it’s the name of your business, a product you manufacture, a service you offer. It’s important that you protect anything that can be construed as proprietary against theft both in the United States and in other countries.
Most IP rights are territorial, meaning, for example, a U.S. patent or trademark only provides protection in the United States. To receive IP protection in other countries, you need to apply for protection in those countries.
Take an IP inventory of your business and determine what might be eligible for a patent, trademark, copyright or trade secret status. Taking steps to protect your IP early-on will go a long way towards minimizing the chances that you’ll be involved in a lawsuit.
Despite your best efforts to resolve a dispute, sometimes you’ll need to call in an expert mediator. A mediator is a neutral third party trained in conflict resolution. His or her job is to get the parties to negotiate and enter into a settlement agreement. Settling a dispute out of court through a mediator is a lot less expensive and disruptive than litigation.
Another feature that makes mediation so attractive is that it can be completed in one day, whereas litigation can take years.With a success rate of about 80%, it’s easy to see why companies prefer mediation. The next time you’re threatened with litigation, suggest mediation. You’ll be surprised how often the other party will agree. You can call your local bar association for recommended mediators. The result of a successful mediation is a binding agreement that resolves the conflict and, in some cases, even restores damaged relationships.
As opposed to mediation, arbitration results in a binding or nonbinding decision of the dispute. If you choose to have your dispute arbitrated, you and the other party must agree that the arbitrator or arbitration panel has the power to hear the dispute and make a final binding decision that both parties will abide by.
If the losing party doesn’t comply with the arbitration award, the winner can convert the award to a court judgment and have the judgment enforced like any other. The advantages to arbitration are that it’s cheaper, quicker and more private than a court proceeding. In arbitration, relaxed rules of evidence are used so that the process doesn’t get bogged down in legal maneuvering.
Follow the 5 guidelines above, and you’ll be well on your way towards preventing a lawsuit from destroying your Florida business. And if you need help, it’s always a great idea to call a Florida Business attorney for assistance.
About Cueto Law Group, P.L.: Cueto Law Group is a Miami-based law firm providing a full range of legal and business solutions to a diversified customer base worldwide, including corporations, entrepreneurs and individuals. Santiago A. Cueto, Esq, the firm’s founding member, is a Board Certified International Attorney, a distinction awarded to less than one percent of Florida’s 50,000 attorneys.
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