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Think about your steps when your company is sued

As a small business owner, you have probably tried to grow your business by developing a strong reputation in the community. Having a lawsuit against your company is one thing that can damage this. If you do find out that your company is being sued, you have specific steps to take as you work toward addressing the problem.

First, you shouldn't communicate directly with the plaintiff once they file a lawsuit. Instead, let your attorney handle the matter for you so that you can focus on preserving your business. You also need to remember that everything you say regarding the legal matter can be used as part of the case. This is one reason why companies often release neutral statements about legal matters or simply state that they won't comment on a pending legal matter.

Second, determine how you will answer the matter. Once the lawsuit is filed, you will receive the notification of it. This document will provide you with information about the process for answering the complaint. There is a deadline associated with these matters, so be sure to review this on the documentation, so you can ensure you file your response prior to the expiration date.

Third, make sure that you alert your insurance company if you have one. There are limited instances that these policies will cover, so find out whether the one you are facing is one that is covered. You might have to refer to the policy information to verify whether you are covered or not.

Throughout the case, you have to ensure that you are doing what is best for the company. Work closely with your attorney so that you know your options and how each might impact your business.

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