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Protecting Your Assets Avoiding Day-to-Day Liability Risks Navigating the Court System Risk Factors Inherent in Litigation Economic Disadvantages When Being Sued
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PrintEconomic Disadvantages When Being Sued
When navigating the court system, a small business owner encounters certain risk factors inherent in litigation.
The combination of three components of our civil litigation system presents a real threat to small business owners who one day may find themselves at the receiving end of a lawsuit:
- Attorneys for plaintiffs (the person or entity suing) handle many damage-type cases on a contingency basis. In other words, the plaintiff doesn't have to lay out any money to sue and the attorney only gets paid if his client prevails.
- While the person suing may not have to put any money down, the defendant (the person being sued) is paying an attorney an hourly rate to defend himself against the lawsuit. As you can imagine, these hourly rates are substantial and can really add up.
- In our civil litigation system, if someone sues you and they lose, as a general rule, they do not have to reimburse you for your cost of defending yourself against their suit. The United States does not have, for lack of a better phrase, a "loser pays" system.
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