What is Commercial Litigation? Commercial Law Litigation Explained

Commercial litigation refers to litigation (lawsuit) that involves commercial or business disputes in court between two or more parties.

Brad Nakase, Attorney

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Commercial Litigation Example

Alan is the owner of a furniture company in Los Angeles. Last year, he signed a contract with a vendor in San Francisco with the understanding that the vendor would provide a certain number of textiles every month for five years. However, after six months, the vendor stopped supplying the correct number, and the quality of fabric dropped significantly. Alan made the case that the vendor was breaching the terms of the contract. The vendor, however, refused to take responsibility, arguing that they had no control over shipping delays from overseas. At this point, Alan decides he has no choice but to pursue commercial law litigation. After all, his business relies on these textiles which are a major source of profit. Alan hires a lawyer who specializes in commercial litigation disputes. Alan’s commercial litigation lawyer contacts the vendor and tries to find a resolution.

Commercial Law Litigation

For business owners, a company is far more than just a place to work or a job to hold. A company is their passion and one of the most important parts of their lives. Because of the importance that entrepreneurs give their businesses, transactions are most often made by way of contract or agreement. An agreement can take the form of a letter of intent, a contract, or a signed memorandum. The purpose of contracts is to detail the rights and obligations of the parties. If the terms of the contract are violated, then serious consequences will follow. As an example, employment contracts will generally have terms and conditions of employment. They may also have elements, or provisions, that stay active after the employment relationship has concluded.

When one party does not fulfill its part of the agreement, then it is guilty of breaching the contract, or breaking it. The party that suffers harm as a result of the breach has the right to pursue legal consequences through litigation. In the event a party faces commercial litigation, they should contact a business litigation lawyer for advice and representation. Commercial law litigation subjects include real estate interests, acquisition, partnership termination, insurance, and employment contracts.

Issues such as breach of contract can severely damage a company financially, causing business operations to slow. Similarly, if a business faces a commercial lawsuit, then the result can harm professional reputation. The reality is that filing lawsuits and defending oneself against lawsuits is simply part of today’s business world. If a business needs to defend itself against a claim or file one against another party, then the owner should hire a commercial litigation attorney to protect or advocate for the company.

Types of Commercial Litigation Cases

Commercial litigation law is a term used to describe any type of legal issues or litigation related to businesses. Both business entities and individuals can be involved in commercial litigation depending on the subject matter of the dispute. Business arguments that result in legal action can be very complex in nature, and every dispute has the potential to result in an expensive lawsuit. There is a wide variety of commercial litigation and many circumstances in which it might come about. Some types of commercial litigation include the following:

  • Breach of contract
  • Business appeals
  • Business dissolutions
  • Breach of fiduciary duty
  • Business torts
  • Business divorce
  • Construction disputes
  • Employment litigation
  • Disputes regarding non-compete agreements
  • Franchise disputes
  • Fraud
  • Intellectual property disputes
  • Insurance disputes
  • Officer and director liability
  • Oil and gas disputes
  • Real estate disputes
  • Partnership disputes
  • Shareholder litigation
  • Tortious interference

Sometimes, despite a company’s best efforts, commercial litigation is unavoidable. In the event of a lawsuit, it is best for the business to contact an experienced commercial litigation lawyer to represent their interests in court.

Hiring a Commercial Litigation Lawyer

Typically, business disputes start out as small disagreements between parties. When the parties are unable to reach a compromise or resolution, then either party may decide to file a commercial litigation lawsuit. In this event, the other party should hire an experienced commercial litigation attorney to defend their interests, because the issues involved in these kinds of lawsuits are often too complex to handle on one’s own. Commercial litigation laws vary depending on the state as well as the type and size of the businesses involved. A commercial litigation lawyer can explain the relevant laws and realistically describe the potential outcome of the case. They will be able to represent the business and seek the best result possible.

However, it should be noted that hiring a commercial litigation lawyer does not mean the case will automatically go to trial. Certainly, a lawyer can help one’s business in the event there is a trial, but most cases don’t proceed that far. Once a party hires a lawyer, the lawyer will reach out to the other party involved and seek a resolution. The suing party may drop the issue or agree to a fair offer. It is also possible that the case might go to mediation. Mediation is a cheaper and faster alternative to a trial. Lawyers are able to mediate a case and negotiate a fair resolution for all parties.

When searching for a commercial litigation attorney, a business owner should be sure to ask the right questions. It is important to ask an attorney what types of business cases they have experience managing. This is because some lawyers specialize in certain types of cases while others handle all manner of commercial litigation disputes. It is also advisable to ask whether a lawyer charges by the hour or provides a flat fee for their services.

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