Business Protection is all about Business Planning

I know it’s so lawyer of me to talk about getting sued. And hopefully, that won’t ever be the case for you and your business. But that’s a reality that we face when running a business, and I want you to be prepared by implementing a business protection plan. So you get served with a lawsuit. What now?

Don’t Panic

Whether it’s a legitimate claim or totally bogus, don’t freak out. You need to handle this with a clear and rational mind in order to ensure the best outcome for yourself. If you don’t already work with an attorney, contact one. Most attorneys offer free consultations to hear about what the issue is and tell you what your next step should be.

Don’t Delete Anything

Sometimes you see a conflict coming before it arrives. Sometimes you’re totally blindsided by a lawsuit. You might be tempted to delete that tirade you sent to them via email or text, but don’t. Not only is it illegal to delete records that relate to a pending lawsuit, but even if you think it looks bad for you, you want the full and complete picture. Holes in the story because you deleted something doesn’t typically improve your position. 

Records retention can include communications with the person who is suing you, but it can also include internal emails, documents, memos, receipts, etc. that relate to the issue, as well as contracts and communications with the claimant. Be sure you have a records retention policy in place for employees and independent contractors so everyone knows how to act properly.

Be Prepared. Have a Business Protection Plan.

The reality is, you just can’t foresee where, when, or why you might get sued. But what you can do is prepare ahead for the best outcome. So what does that look like?


Often, things go sideways in a transaction with a business partner, a vendor, or even a client. If you have a contract in place, this is the best protection for you. A well-written contract ensures everyone is on the same page at the outset, but just in case things go sour, it’s your proof of what was intended if you have to take it to arbitration or to court.


There are various insurance policies you can (and should) get for your business, and these are the situations that you’ll be thankful you have insurance. Liability insurance for issues with your products, general business liability to cover disagreements or a payout for an angry customer, and workers’ compensation for any incidents or injuries of your employees are just a few examples.

Entity Operations

If you run your business as a formal entity (corporation, limited liability company, etc.) you’ll want to be sure you’re actually following corporate formalities if you want that limited liability to stick. That means not using your personal bank account for business purposes, keeping minutes of major business decisions, and keeping all state, federal, and local filings, licenses, and permits current.

If you don’t follow corporate formalities and your business is sued, there is a possibility that you can be personally liable for your business’s liabilities.

The reality is, while you can’t guarantee you’ll never end up in a lawsuit, the better prepared you are, the more likely you and your business will come out relatively unscathed.

How can I help you be more prepared? Let’s chat about your business planning.