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Dealing With Business Disputes: Strategies for Resolution

Dealing With Business Disputes Strategies for Resolution

No business is immune to disputes. Conflicts with a supplier, vendor, partner, employee, or customer are bound to arise occasionally. How you handle these business disputes can make a big difference in their impact on your company.

You need effective strategies for resolving disputes. Sometimes, you may need to work with an experienced Tacoma business dispute lawyer to protect your interests and find an optimal resolution.

If you find your business in a serious dispute, a knowledgeable business dispute attorney can explain your options and chart the best path forward.

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Common Types of Business Disputes

Business disputes can take many forms, but some of the most frequently occurring ones include:

Contract Disputes

Contracts are extremely important for businesses. They are written agreements that explain what each person or company has to do. But sometimes, one side might not do what they promised. This can cause major problems.

For example, a business orders a bunch of supplies from another company. They sign a contract indicating the supplies will be delivered by a certain date. But when that date comes around, the supplies never show up!

This is called a breach of contract. The business that was supposed to get the supplies might lose money because they cannot make their products on time.

Contract disputes can happen with all sorts of people and companies a business works with.

This includes suppliers who provide:

  • Parts or materials.
  • Vendors who sell the business’s products.
  • Partners who help run the company.
  • Employees who work there.
  • Contractors who do special jobs.
  • Even customers who buy products or services.

Anytime someone doesn’t follow a contract, it can become a big dispute.

Partnership Disputes

When two or more people start a business together, they are called partners. They might have a written partnership agreement on how they will run the company. But even if they are friends, partners can still argue.

Partnership disputes can involve many things. Maybe the partners disagree about an important decision, like whether to buy a new building. Or maybe they argue about how to split up the profits. Some partners might feel like they are doing more work than others. There can also be fights if a partner doesn’t follow the rules in their agreement.

These kinds of disputes can cause headaches for a business. The partners might spend more time arguing than actually running the company. If partnership problems aren’t addressed quickly, the whole business can be in trouble.

Employment Disputes

Businesses need workers to help them run. These workers are called employees. The company and the employees have to follow certain laws and rules. But sometimes, the company or the employee might break these rules. This can lead to an employment dispute.

One common employment dispute is called wrongful termination. This is when a worker is fired for an illegal reason. For example, a boss can’t fire someone just because of their race or because they are pregnant. That’s discrimination.

Other employment disputes might involve harassment. This occurs when a worker is bullied or mistreated at their job. It might involve a boss or another worker saying mean things or acting inappropriately.

Sometimes, employment disputes are about money. Workers might say they did not receive the right compensation for their work hours. These are called wage and hour violations.

If workers feel the company broke the law, they might file legal claims. This can cost the business a lot of money, so companies must follow the rules and treat workers fairly.

Intellectual Property Disputes

Some businesses make money from things they create with their minds, like art, inventions, or special designs. These are called intellectual property. The law says a business can own these creations, like owning a car or a house.

But sometimes, another person or company might try to copy or use the intellectual property without permission. This is called infringement. It’s like stealing and can hurt the business that owns the property.

Intellectual property disputes can be about copyrights (for things like books, music, or artwork), trademarks (for logos or brand names), patents (for inventions), or trade secrets (for confidential business information). When an infringement happens, the business usually needs a lawyer to help stop the copying and get money for the loss.

Fraud and Misrepresentation

Unfortunately, sometimes, people or companies act dishonestly in their business dealings. They might lie, cheat, or trick others to get ahead. This is called fraud or misrepresentation.

For instance, let’s say a company sells a cleaning product. They tell customers that it’s all-natural and safe, but it’s really made with dangerous chemicals.

Another example is if a business lies about its taxes or financial records. It might hide money or make it look like it earned more than it really did. This is also fraud.

Fraud and misrepresentation can take many forms. A supplier might lie about when they can deliver goods, a partner might hide important information from others, or a company might trick people with fake advertisements. All of these dishonest actions can lead to serious disputes and financial harm.

When a business is a victim of fraud, it often needs to take legal action to get its money back and stop the fraudster from causing more damage. Fraud cases can quickly grow complicated, so hire a good business lawyer.

Steps to Take When a Business Dispute Arises

When you find your business involved in a dispute, take action. Some key steps include:

Review Relevant Contracts and Documents

Before jumping to conclusions, carefully review contracts, agreements, correspondence, invoices, or other documents relevant to the dispute. These can illuminate each party’s rights and obligations and may even resolve misunderstandings. Gather copies of all important documents.

Communicate with the Other Party

Open and professional communication with the other party involved in the dispute can go a long way. Clearly explain your position and try to understand theirs. See if you can find common ground or reach a compromise. Sometimes, disputes escalate unnecessarily due to miscommunication or mistaken assumptions.

Consult with a Business Dispute Lawyer

Complicated business disputes are not a time for a do-it-yourself approach. Consult an experienced business dispute attorney early in the process.

A business attorney can review the situation, explain your rights, suggest strategies, and represent your interests in negotiations or legal proceedings. Many disputes can be efficiently resolved with the assistance of skilled legal counsel.

Consider Options for Alternative Dispute Resolution

Rushing into litigation is rarely the best first step for business disputes. Several alternative dispute resolution (ADR) methods can resolve the conflict faster and more cost-effectively than a lawsuit. Discuss ADR options like mediation and arbitration with your business dispute lawyer.

Document Everything

Document all important developments, discussions, and exchanges relating to the business dispute. Save copies of relevant emails, letters, invoices, and contracts. 

Keep detailed notes on any conversations or meetings, including dates and participants. Thoroughly documenting the dispute will help if you need to pursue or defend a legal claim.

Take Steps to Mitigate Damages

If your business has suffered harm due to the dispute, you have a legal duty to take reasonable steps to mitigate your damages. This can include finding alternative suppliers to fulfill orders, hiring temp workers to cover an employee’s absence, or discounting products to move excess inventory.

Failure to mitigate damages can limit your ultimate recovery.

Out-of-Court Resolution Strategies

Many business disputes can be successfully resolved without resorting to litigation. With the guidance of a business dispute attorney, out-of-court resolution strategies to explore include:


Sometimes, a dispute can be resolved through direct negotiations between the parties (or their lawyers). Negotiation allows for a flexible, business-oriented approach focused on each side’s key interests and finding mutually beneficial solutions.

A skilled business dispute lawyer can protect your rights and strategically guide you through the negotiation process.


Mediation is a popular form of ADR for business disputes. In mediation, a neutral third-party mediator facilitates a conversation between the disputing parties to identify issues, explore options, and try to reach a voluntary settlement.

The mediator does not impose a decision.

Mediation allows the parties to retain control of the outcome. Many courts require parties to attempt mediation before allowing a lawsuit to proceed.


Arbitration is another common ADR method for business disputes. In arbitration, the parties present their case to a neutral third-party arbitrator (or panel of arbitrators) who renders a binding decision.

Arbitration is generally faster and cheaper than litigation. Many business contracts include mandatory arbitration clauses.

Settlement Conferences

For business disputes that do enter litigation, the court may hold one or more mandatory settlement conferences before trial. These involve the parties and their lawyers meeting with a judge to explore possibilities for settling the case. Settlement conferences can resolve litigation with the assistance and informal input of the judge.

When You Need Litigation

In some business disputes, out-of-court resolution proves impossible, and litigation becomes necessary. This is more likely in cases involving:

High Financial Stakes

When a dispute involves a large amount of money or valuable assets, the parties may be unwilling to compromise. The higher the stakes, the more likely a business dispute will end in court.

However, even high-value cases often settle before trial once the parties have a chance to more thoroughly assess the strengths and weaknesses of their positions through the litigation process.

Unresolvable Factual or Legal Disagreements

Some business disputes involve disagreements over key facts or the application of the law that the parties simply cannot resolve on their own. The parties may need a judge or jury to hear evidence, weigh credibility, and render an authoritative decision on issues in the case.

Uncooperative or Bad Faith Parties

Occasionally, one party to a business dispute is so uncooperative, unreasonable, or acting in bad faith that negotiation or ADR is futile.

Some parties entrench themselves so deeply that only the litigation hammer will break the logjam. In these cases, aggressively pursuing your rights in court with an experienced business dispute attorney is often the only viable option.

Emergency Relief

Some business disputes require immediate action to prevent irreparable harm, such as intellectual property infringement, misappropriation of trade secrets, or a breach of a non-compete agreement by an employee.

In these situations, a business may need to file a lawsuit and seek emergency temporary injunctive relief from the court to stop the damaging conduct until the case concludes.

Tips for Succeeding in Business Dispute Litigation

If your business dispute does lead to litigation, to put your company in the best position to succeed:

Hire the Right Business Dispute Lawyer

Choosing the right business dispute attorney is key. You need a lawyer with extensive experience in your specific type of dispute and a track record of success in business litigation. Look for a responsive, trustworthy lawyer with the bandwidth to devote proper attention to your case.

Gather and Preserve Evidence

You will need evidence to support your claims or defenses to prevail in litigation. This may include documents, electronic data, physical evidence, and witness testimony. Work with a business dispute attorney to gather all relevant evidence. Preserve evidence properly to avoid accusations of spoliation.

Respond to Pleadings and Discovery

Litigation involves an exchange of pleadings, disclosures, and discovery between the parties. You will likely need to respond to the complaint, answer interrogatories, produce documents, and possibly sit for a deposition. You can provide thorough, accurate, and timely responses by working closely with your business dispute lawyer.

Attend Mediation and Settlement Conferences

Even if initial attempts at ADR were unsuccessful, most courts require the parties to attend mediation or participate in one or more formal settlement conferences during litigation.

Prepare thoroughly with your attorney and participate in good faith. Keeping an open mind to settlement while advocating forcefully for your position is often the best approach.

Calculate Damages and Make a Demand

To reach an informed resolution, you need a clear picture of the damages your business has suffered due to the dispute. This may require a thorough analysis of lost profits, loss of business value, out-of-pocket expenses, and other harm.

Once you calculate your damages, work with your lawyer to make a formal settlement demand.

Develop a Trial Strategy

You and your business dispute attorney must gear up for trial if you cannot obtain a pretrial settlement. Develop a comprehensive trial strategy, including a case theme, key evidence to present, anticipated witness testimony, and arguments on the law.

Contact a Business Dispute Attorney Today for Your Free Consultation

Many business disputes settle out of court through negotiation, mediation, or arbitration. However, some cases require litigation to vindicate your company’s rights. Hiring a skilled business dispute lawyer is the best way to protect your interests and achieve a favorable result.

If your business faces a dispute, don’t go it alone. Contact an experienced business dispute attorney today for a consultation. A business dispute lawyer can assess your case, explain your options, and chart a course to the best possible resolution.