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Small Business Owners: Beware the Frivolous Lawsuit

By Christopher Coble, Esq. | Last updated on

It's a lawsuit so frivolous that some are theorizing the case is spoofed -- an attempt to force legislators to pass tort reform laws that would hinder a person's ability to bring lawsuits in the first place: A couple McDonald's customers in Florida sued the burger chain, claiming they were charged for cheese on their Quarter Pounders, even though they didn't want it. Whether their legal beef is legit, whether they're just looking for a quick settlement, or whether the whole thing is a false flag operation designed to make consumer lawsuits look bad, we may never know.

We all know that dealing with legal issues is just part of the cost of opening a small business. But there are ways to prevent frivolous litigation before it starts, and mitigate the harm it can do to your bottom line if it does. Here's a look:

Of course, any lawsuit filed against your company is going to feel frivolous or without any factual basis. But you'll want to confirm that first. Investigate the matter fully, that way when you respond to the suit, you'll have all the accurate info you'll need. You can file a motion to dismiss the lawsuit entirely, file your own counterclaims against the person or company that sued you, and possibly bar them from suing you (or other small businesses) in the future.

2. What to Do When Customers Threaten to Sue Your Business

A threat of a lawsuit can be as damaging and as expensive as a lawsuit itself. (It can also be as frivolous.) And how you respond to that threat can be as important as how you would respond to a real lawsuit. Again, proceed with accurate information, and avoid making threats yourself.

3. How to Make Sure Your Business Can Withstand Lawsuits

Sure, we'd like to advise you to just run a well-functioning, law-abiding, honest small business. But the fact is, good companies get sued, too. Investing in your public image -- as well as a good insurance policy -- can help deter lawsuits and deal with them if they happen anyway.

And of course, always have a good business attorney handy.

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