Real-World Solutions To Real-World Challenges

Business battles: Avoid these three common disputes

On Behalf of | Jun 11, 2024 | Business Litigation |

Entrepreneurs can benefit from learning from those who have already overcome countless business disputes. By understanding some of the more common pitfalls, current business leaders can gain valuable insights and avoid making the same mistakes.

Three of the most common business disputes that current leaders can avoid include the following.

1. Contract disputes

Contracts are the backbone of business relationships. The language used within these agreements helps to guide various relationships within the business arena. From employees to vendors, these agreements serve as a blueprint for the relationship from inception through termination.

If not drafted wisely, disputes can arise. The following tips can help to minimize the risk of a contract dispute:

  • Clarity: Clearly define terms, obligations, and expectations in written contracts.
  • Specificity: Be precise about deliverables, deadlines, and payment terms.
  • Update: Regularly review contracts and update as needed.

Contracts tailored to your business’ needs can help reduce ambiguity and mitigate the risk of disputes. Unfortunately, even when drafted wisely disputes can arise. A contract drafted to your specific needs is more likely to survive a legal challenge than a document with broad and poorly defined provisions.

2. Intellectual property protections and noncompete agreements

A business’ most valuable asset is often its intellectual property. A nuanced approach to protecting IP takes more than just patents, copyrights and trademarks, it also requires strategic use of noncompete agreements. Wise use of noncompete agreements can help to reduce the risk that a former employee uses your business’ trade secrets to help the competition.

3. Shareholder disputes

Internal conflicts among shareholders can harm a company. It is important to draft clear agreements on ownership, voting, and decision-making and foster open dialogue among shareholders. Well-defined shareholder relationships can help to prevent disputes.

Although taking steps to avoid the same mistakes does not guarantee protection from litigation, it does better ensure you have the tools you need to defend your stance in the event of a dispute.