What Should You Know About Commercial Litigation?


Businesses may become the defendant in a lawsuit for a variety of reasons, and an attorney can help the owners navigate through these cases. Commercial litigation often becomes complex and takes years to settle. Companies take out insurance policies to offset financial losses generated from lawsuits, but this doesn’t mean that coverage is always available. By discussing commercial litigation, companies learn what to expect.  

What Is Commercial Litigation?

Commercial litigation pertains to legal disputes between companies, the company and a client, or other parties, and the cases encompass disputes related to real estate, contract breaches, lease agreements, or debt collection or management. The litigant believes they’ve incurred monetary damages and wants to recover the funds. Attorneys try to use mediation in these cases to arrive at an agreement or settlement, and mediation pursuits can reduce the total financial loss for some clients. Feldman and Feldman can help businesses that become the defendant in these lawsuits. 

Are Verbal Contracts Actionable?

Depending on the state, some claimants can file a lawsuit over a verbal contract, but the contract must have specific terms to which both parties have agreed. There must be an exchange of consideration or something that has a value between both parties. Some states allow for legal disputes between partners with verbal contracts, but some jurisdictions require the partners to create a physical contract that defines the exact terms. 

Can Businesses Stop Workers From Taking a Job With a Competitor?

Yes. If the employee signed an employment contract containing a non-compete clause, the employer can take legal action. Workers are able to collect trade secrets through their employment that could cause a conflict of interest and financial losses. The employer can file a legal motion to prevent the worker from taking a job with a competitor, but the court’s decision is final and determines if the new employment contract violates the original agreement.  

When Another Business Interferes With Your Clients

If a competitor interferes with existing client relationships, the opposing party may have a case, and the business owner can file what is referred to as a tortious interference lawsuit. Essentially, this means the claimant has a long-term relationship with the client, and there are contractual obligations. Once the court rules in favor of the claimant, there is a legal avenue to collect tort-based or non-economic damages from the competitor. 

What Is Breach of Contract?

A breach of contract arises when a company has contractual obligations to a client or partner and fails to meet these expectations. When a breach occurs, the other party can file a lawsuit. The breach pertains to a promised service, end results, or even a predetermined return on investments.

The claimant seeks monetary damages to offset the financial loss caused by the breach, and the court can determine how much the person is entitled to receive. Many companies that perform services for clients face these lawsuits, and a common reason is that each task outlined in the contract wasn’t completed to the expectations of the client.  

Commercial litigation happens when one party believes a financial loss has happened because of violations of a contract, and the defendant can face excessive payouts if the claimant wins. Business owners need help navigating through these cases to avoid going to court. Many attorneys help defendants find options for disproving the cases, and the companies could also settle out of court. Reviewing commercial litigation helps companies mitigate risks and avoid serious financial losses.  

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