Why businesses shouldn't file a lawsuit
Sometimes small businesses find themselves in positions that seem like they need the help of the law in order to sort through the rubble. Of course, the process of taking someone to court can take a long time, and results are not guaranteed. Often it is considered the only option for getting payment, sorting out copyright infringement, etc. However, no matter how much it seems like this is the best option, lawsuits are almost always a bad idea for businesses. Here's a few reasons why:
1. Costs more than you might think. The cost of a lawsuit is more than filing fees and the like. It also has costs like time and other resources. Filing and managing a lawsuit is always more time consuming and resource draining than estimated. Typically it will be twice as much as you plan, and that does not even account for things like the emotional response of being involved in a lawsuit. Unless the tangible benefits of the lawsuit outweigh by far the tangible and intangible, do not even go down that road.
2. Often swings back to hurt you. Sometimes filing a lawsuit can lead to results you do not want. You may make a claim and feel justified, but their attorney may turn the claim on you, and file a counter-suit. What was once cut and dried may turn into quite the fight as truth is re-cast, and perspectives get altered. If you are considering suing, evaluate the repercussions that may come as a result. If you are not prepared to handle potential repercussions, then don't take the first swing.
3. You never really win. Even if you feel like you have all of the truth on your side, a prolonged fight usually just costs a lot of time, effort, and money, so even if you "win" you have lost a lot along the way. In some cases you might be awarded a settlement, etc. but whether or not you ever see a penny of it is fate. The fact is, most companies try to settle the suit early because they know that the ramifications of a prolonged fight are never good.
Many lawsuits are born of emotion and hurt feelings. If you really want to take someone to court over something, sit down, put your ego aside, and do a real cost-benefit analysis, assuming the worst, and then determine if this is the best resolution method you have available to you. A mediator might be a more cost effective option. In other cases, just taking the loss, and letting it go is the best option. It is sad that a system set up to protect people can be so faulty, but it is, and thus, if you are a small business, you should think twice, or maybe even ten times before filing a lawsuit. It could come back to bite you.