The Anatomy of a Business Dispute - Part 1

An overview of the components of a business lawsuit A business lawsuit basically has three main parts.  Documents filed with a court are called pleadings. The initial pleadings such as the Complaint define the dispute and create a roadmap of the issues for the parties and the court. Another part of a business dispute is the gathering and exchange of information which is called discovery. Finally the dispute is resolved in some manner either by direct settlement, mediation, non-binding arbitration, summary judgment or other procedural mechanisms, or by a trial.

Lawsuits are only one mechanism to resolve business disputes. There are other methods of so doing outside of court such as pre-suit mediation and arbitration. The benefit of consulting with an experienced Board Certified expert like Mr. Steinfeld is that it allows your business to discuss and identify the objectives and identify the resources of the business or people involved so all the alternatives that may achieve those goals with the resources available can be fully assessed. That allows you as the business owner to make better informed decisions on these important decisions. Why experience matters in business disputes Critical to the prosecution or defense of any business dispute or commercial lawsuit is the structuring and framing of the action.  Akin to constructing a house or building, a lawsuit, counterclaims, and defenses must be carefully considered and planned before they are implemented.  This is why experience matters. 

Board Certified business lawyers in Florida have had their trial experience verified, have had their knowledge tested, and have been reviewed by Judges and lawyers. David Steinfeld is one of the few lawyers in Florida that has been qualified by the Florida Bar as a Board Certified expert in business litigation. He has even chaired that Committee for the Florida Bar at the behest of its President and written large parts of the certification exam. 

To become Board Certified in business litigation in Florida an attorney must have a significant number of bench and jury trials and be reviewed by their peers and by judges before they are even allowed to sit for a difficult examination akin to a mid-career Bar exam. Once the applicant passes the exam, he or she becomes Board Certified for five years. Every five years thereafter the attorney must apply for Re-Certification, show that he or she has tried a certain number of cases in the interim to keep one's skills sharp, and again undergo review by judges and by their peers. Mr. Steinfeld has been Board Certified as a business litigator since 2010.

He has also been recognized for several consecutive years as one of the Best Lawyers in America by U.S. News and World Report, a Florida Super Lawyer, and one of Florida’s Legal Elite among other well-regarded awards and recognitions that are identified on the Awards Page of the Firm’s website.

Also as a former U.S. Army Officer in both the intelligence community and practicing law in the Judge Advocate General’s Corps attorney David Steinfeld has a unique tactical approach to business lawsuits that optimize the opportunity for success in that venue for any business.  The Pleadings Phase The first phase of a business lawsuit is the pleadings phase in which the parties file documents with the Court that tell each other what the lawsuit is about, what their claims are, whether those are accepted or rejected, and what defenses exist. 

There can be challenges to the claims and refinements of those known as motions to dismiss and amended complaints. But after those issues are worked out either between the lawyers or by a Judge, this stage comes to an end unless something unique comes up later that causes the parties to have to revisit what they said the lawsuit was about. The Complaint and the Answer The Complaint starts the lawsuit. It establishes who the parties are, how and why the court has jurisdiction over them, the background facts and any supporting documents, and the specific legal claims recognized by Florida law. The Answer responds to the allegations of the Complaint and can also contain defenses known as Affirmative Defenses. In the defenses, the defendant brings up its own issues like the fact that the claim may be beyond the statute of limitations or that the contract on which the plaintiff sued was somehow facially or legally defective. Compulsory and Permissive Counterclaims Separate from the Answer and Defenses, the defendant also has the right to file a counterclaim. This is like a separate lawsuit within the lawsuit for which the Clerk of Court charges an additional filing fee because it is actually a separate lawsuit.

In the counterclaim, the defendant sues the plaintiff for its own claims which can be based on the plaintiff's claim or separate and unique from those. Counterclaims based on the original claims are called compulsory counterclaims and those more often have to be filed when the answer is filed.

Conversely, counterclaims that are not based on the original claims and are their own unique claims are called permissive counterclaims. Those can be filed when they arise but are also generally filed when the answer is filed if they are known at that time.

As you can see what is occurring between the parties in this early pleadings stage is that they are telling each other what their claims are and upon what factual allegations they are based. This is required for due process but also makes the overall litigation more efficient as the parties are putting their proverbial cards on the table. Third-party claims and Crossclaims After a lawsuit starts the defendant or one of multiple defendants may realize that they have claims against another party who may not be part of the lawsuit at that point. When this occurs, the defendant can file a cross claim against a co-defendant or a third-party claim against a party that is not even named as a defendant.

In a cross claim, a defendant seeks to defer or share liability with another. For example, in a construction defect case where multiple contractors worked on a property and all are sued for the defects and damages, one contractor may blame the actions of another for causing their work to become defective or add to the defect. 

In contrast in that construction defect example, if the plaintiff did not sue a party, say a materials supplier with whom it had no contract or connection, then the contractor that sourced the materials from that supplier may bring the supplier into the suit with a third-party claim. In such claim the suing party may allege that it was the defective materials that caused the problem and not the contractor's installation of those materials.

Starts to sound complex and we haven’t even discussed motion practice like motions to dismiss or for judgment on the pleadings. The complexity and timing of these procedural mechanisms is codified in Florida’s Civil Procedure Rules. Along with the Rules of Evidence you should expect that your lawyer knows and understands those well as they are his or her tradecraft.  Part 2 of this article examines the Discovery Phase