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What To Do When Your Business Partner is Suing You

My Partner is Suing Me, What Do I Do?

A business can end in many ways, from a successful sale to an unsuccessful bankruptcy. In some circumstances, a business can even end when one partner files a lawsuit against another. While the best legal option depends on the nature of the lawsuit and the partnership, potential outcomes from a lawsuit between partners can result in a dissolution of the business, holding a partner personally liable for a breach of contract, or expulsion of one partner from the business.

First Three Steps if a Partner is Suing You

Here are the steps that a partner should take upon receiving notice they are being sued by their partner:

  • Contact an Attorney. Because the outcome of a lawsuit between business partners can be so consequential, it is advisable to speak with a knowledgeable, local attorney in the East Bay area. An attorney will be able to advise you on the legal options that may be available in your specific case and help prepare you for any possible outcomes. Further, if the lawsuit continues to litigation, then an attorney will be able to advocate on your behalf in the courtroom.
  • Look at the Partnership Contract. When forming a partnership, many business operators choose to create a “partnership agreement” which outlines their rights and responsibilities, as well as the process and available damages to each partner in the event of a lawsuit. Because not all of these provisions may be valid or enforceable, it is important to have an attorney look over the partnership agreement to determine if that agreement is enforceable. More importantly, an attorney will be able to explain the legal terms of the partnership agreement, ensuring that each business partner fully understands the terms of an agreement and how these terms may affect a partners rights and responsibilities.
  • Gather Business Records. Business records will be important in any lawsuit regarding the company. These include financial statements, regulatory filings, and any document relevant to the lawsuit. Sometimes, in the course of a lawsuit between business partners, one partner may limit access to these important documents. For this reason, it is important to retain a copy your business records whenever possible. In addition, your Fremont business attorney will need as much information as possible to be able to provide comprehensive advice on how best to proceed in a lawsuit.

Because a lawsuit by a business partner can have serious, far-reaching consequences for you and your business, it is important for you to reach out to a lawyer who can ensure your legal rights are protected.  If your issue is occurring in the Fremont, Livermore, Pleasanton, Oakland areas of California, contact the experienced attorneys at JGPC Business Law for further guidance and assistance.

JGPC Business Law is a business law firm providing cost-effective, quality legal services to privately held businesses, corporations, limited liability companies (LLCs), general partnerships, joint ventures, limited liability partnerships (LLPs), limited partnerships (LP), trusts, business start ups, entrepreneurs, business owners, managers, executives, investors, buyers & sellers throughout the Tri-Valley and the East Bay Area, including Pleasanton, Dublin, Livermore, San Ramon, Danville, Walnut Creek, Castro Valley, Fremont, Tracy, Modesto, Manteca, Stockton and all of Alameda County and Contra Costa County. We are here to serve all of your business and corporate law needs.