Filing a Lawsuit Against a Business

Filing a Lawsuit Against a Business

In order to sue a business, there are several steps you have to go through, which include determining your own standing and legal capacity, identifying the correct party to sue, and following specific rules based on the legal entity of the business. Much like filing a lawsuit against a natural person, doing so against a business requires the skills and knowledge of an experienced attorney. Identifying the correct issues and arguments, preparing documents, and following the steps of litigation are all highly specialized skills that are better trusted to professional lawyers.

            First, before moving forward with a lawsuit it is necessary that you have the legal capacity to be party to same. Otherwise, those who are considered to have a legal disability must file the lawsuit through another entity, like a representative. A very important step is to determine whether you can actually file a lawsuit against the business. You need to have “standing” in order to proceed. To have standing, you must have been directly affected by the business’ actions. It can sometimes be difficult to establish standing as some issues arising from the actions of businesses can lead to collective action problems, rather than being directly related to one party. Regardless, if you are to file a lawsuit, you must prove a direct connection.

            Prior to naming a business in a lawsuit make sure that it is the correct entity you wish to sue. If a problem has arisen, follow appropriate links and determine who can be held liable for an action. Once you have identified the correct business to sue, you must now find out the legal entity the business has taken. Most businesses can be an S or C Corporation, partnership, sole proprietorship, or limited liability partnership (LLP).

The differences arise because the legal entities all have different forms of liability. When suing a sole proprietor, it is the owner of the business (single person) that will be named in the lawsuit. For a partnership (not a limited liability partnership like law firms) all partners are held liable for the business’ actions, and as such each partner would be sued. A corporation is its own legal entity; therefore, in the lawsuit the legal name of the corporation would be named. The relevant persons of the corporation will then be notified. An LLP is different from other entities as each partner is not held liable for the business’ debts or lawsuits against other partners. As such, when suing one partner in an LLP, only that partner should be named, like in a malpractice suit against a specific lawyer.

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