What Remedies Are Available in Complex Business Disputes?
Complex business disputes can arise for a variety of reasons, including breaches of contract, intellectual property issues, or disagreements between shareholders. When these situations occur, they can significantly impact the day-to-day operations and profitability of a business. Pursuing legal remedies can minimize potential harm to your business and help protect your business interests.
At the Law Offices of David H. Schwartz, INC., Attorney David Schwartz brings over 45 years of experience to resolving high-stakes business disputes. Located in San Francisco, California, Attorney David Schwartz is familiar with California business law, from handling trade secret disputes and Civil RICO cases to shareholder derivative actions.
Whether your business is looking to file or defend against a lawsuit, a seasoned business litigation attorney can help you resolve the issue effectively.
Common Legal Remedies for Complex Business Disputes
If your business is involved in a dispute, it’s important to know the legal remedies available. The best course of action depends on the nature of the disagreement, the damages or losses sustained, and the involved parties' goals. Some remedies commonly pursued in complex business litigation include the following.
Monetary Damages
Monetary damages are one of the most sought-after remedies in business litigation. These aim to compensate the injured party for their losses. Generally, monetary damages fall into one of the following three categories:
Compensatory damages: These reimburse actual losses that a party incurs, such as lost revenue, expenses, or additional operational costs caused by a breach or misrepresentation.
Consequential damages: These cover indirect losses that occur as a result of the initial harm, such as long-term impacts on profitability.
Punitive damages: Unlike compensatory damages, punitive damages aim to punish the offending party for particularly egregious actions, such as fraud or willful harm.
Specific Performance
When monetary compensation isn’t enough to resolve an issue, the courts may order specific performance. This remedy compels one party to fulfill its contractual obligations rather than simply paying damages for failing to perform.
Specific performance is typically used for unique contracts, such as real estate agreements or certain intellectual property arrangements, where monetary damages wouldn’t suffice.
Declaratory Relief
A declaratory judgment clarifies each party’s rights and obligations under a contract or law. This remedy often serves as a preventative measure, resolving ambiguity before the dispute escalates further. Businesses may use declaratory relief to clarify terms in contracts, licensing agreements, or partnerships that may be subject to multiple interpretations.
Equitable Relief
Equitable relief is reserved for situations where monetary damages wouldn’t adequately resolve the issue. Some common examples of equitable remedies include:
Temporary Restraining Orders (TROs): These orders immediately halt harmful actions until the court can decide on a longer-term resolution.
Permanent or preliminary injunctions: These orders prevent one party from taking a specific action that could harm the other party, such as breaching a non-compete agreement or sharing trade secrets.
Alternative Dispute Resolution (ADR)
Sometimes, pursuing legal remedies doesn’t necessarily mean going to court. Mediation and arbitration are common dispute resolution methods. Both approaches involve meeting with a neutral third party who will facilitate negotiations or make binding decisions on behalf of the parties to help businesses save time and reduce costly court battles.
California Laws Governing Complex Business Disputes
Running a business in California requires a solid understanding of state laws. Below, we explore key legal frameworks that shape the litigation of complex business disputes in the state.
California Uniform Trade Secrets Act (CUTSA): Enacted to protect sensitive business information, CUTSA defines “trade secrets” and provides companies with legal grounds to sue for misappropriation. If another party unlawfully uses or discloses proprietary information, such as customer lists, formulas, or business strategies, CUTSA allows businesses to pursue punitive damages and attorney fees for willful violations.
California Corporations Code: Disputes among shareholders, particularly in closely held corporations, often fall under the California Corporations Code. Shareholder derivative actions allow smaller shareholders to sue on behalf of the corporation for misconduct by directors or officers. These cases reinforce the importance of upholding fiduciary duties and protecting the company’s best interests.
Business & Professions Code Section 17200 (Unfair Competition Law): Under California’s Unfair Competition Law, business owners can take legal action for various types of wrongful conduct, including false advertising, trademark infringement, and other unethical practices. The law enables businesses to seek damages and injunctions to prevent future harm.
Breach of Contract Under Civil Code Section 3300: California’s Civil Code Section 3300 governs damages in breach of contract disputes. It entitles the injured party to recover the full compensatory damages they’ve incurred as a natural result of the breach. The specific terms in contracts can limit what is recoverable, so your business should carefully draft and review all contracts before entering into agreements.
Civil RICO Act (18 U.S.C. § 1962): The Racketeer Influenced and Corrupt Organizations Act (RICO) provides remedies for businesses impacted by organized crime or fraudulent schemes, such as embezzlement or coercion. Although RICO is a federal law, California courts handle many RICO-related disputes involving business dealings.
Business Litigation Attorney Serving the San Francisco Bay Area
Business litigation can often be a point of contention and potentially impact the operations and reputation of your company. Therefore, it's important to understand the legal remedies available to you to protect your interests and resolve disputes efficiently.
At The Law Offices of David H. Schwartz, INC., Attorney David Schwartz provides skilled business litigation support with over 45 years of experience in handling cases of shareholder actions, trade secrets, fraud, and civil RICO actions. Located in San Francisco, California, the firm serves clients throughout Alameda County, San Jose, Santa Clara, San Mateo, and Oakland. Reach out today to schedule an initial consultation.