For any business owner, being served with a lawsuit is one of the most stressful experiences imaginable. Whether the claim involves a contract dispute, an employee complaint, or a customer injury, litigation can threaten your company’s finances and reputation. Unfortunately, ignoring the issue or reacting impulsively can make things far worse.
Understanding what to do, and what not to do, when your business is sued is critical. North Carolina has strict legal procedures and deadlines for responding to civil lawsuits, and missing even one step can lead to serious consequences.
Here’s what every North Carolina business owner should know if they’re served with a lawsuit.
Step 1: Read the Legal Documents Carefully
When your business is served, you’ll typically receive a Summons and a Complaint. The Summons notifies you that a lawsuit has been filed and explains how long you have to respond. In North Carolina, businesses generally have 30 days from the date of service to file a formal response with the court.
The Complaint outlines the plaintiff’s allegations and what they are demanding, often money, specific performance, or injunctive relief. Read every word carefully, noting who is suing you, what the claims are, and which court is handling the case. Never assume that a claim is minor or will go away on its own.
Step 2: Do Not Contact the Plaintiff Directly
It’s natural to want to resolve the issue quickly by reaching out to the person or company suing you. However, contacting the plaintiff directly can backfire. Anything you say, no matter how well-intentioned, could be used against you in court.
Once you’ve been served, all communication should go through your attorney. This ensures that any discussions or negotiations are handled strategically and that your statements can’t be misinterpreted.
Step 3: Notify Your Insurance Company
Depending on the nature of the lawsuit, your business insurance policy may cover part or all of the claim. For example, general liability insurance might cover customer injuries, while professional liability insurance may apply to service-related disputes.
Notify your insurance company immediately after receiving the lawsuit. Most policies require prompt notice to activate coverage. Your insurer may provide legal defense or reimburse certain costs, but delays can jeopardize your eligibility for coverage.
Step 4: Gather and Preserve All Relevant Records
Evidence is key in any legal dispute. As soon as you learn of a lawsuit, start collecting and preserving all related documents, including contracts, invoices, emails, texts, photos, and reports.
Under North Carolina’s civil procedure rules, destroying or altering evidence, even unintentionally, can lead to severe penalties known as spoliation sanctions. Create a secure digital and physical record of all relevant materials and provide them to your attorney for review.
Step 5: Consult a North Carolina Business Attorney Immediately
Time is critical once a lawsuit has been filed. Consult an experienced North Carolina business attorney as soon as possible to evaluate the claim and develop a defense strategy. Your attorney can:
Review the complaint and identify the most effective response.
File the necessary documents within the 30-day window.
Determine whether early settlement, mediation, or a motion to dismiss is appropriate.
Represent your business in court or during negotiations.
Having knowledgeable counsel ensures you comply with North Carolina procedural rules and strengthens your position from the start.
Step 6: Prepare and File Your Response
Your attorney will help prepare an Answer or other legal response to the complaint. This document admits or denies each allegation and may assert affirmative defenses, such as breach by the other party, lack of jurisdiction, or expiration of the statute of limitations.
In some cases, your attorney may recommend filing a motion to dismiss if the lawsuit lacks legal grounds. Every situation is unique, but filing a timely and strategic response is essential to protect your rights.
Step 7: Stay Organized and Informed
Once your case is underway, maintain consistent communication with your attorney and stay involved in the process. Litigation can take months or even years, and organization helps you stay ahead. Keep records of all correspondence, court notices, and key dates.
Your attorney can also help you explore settlement opportunities or alternative dispute resolution (ADR) methods like mediation, which are often encouraged in North Carolina courts to save time and costs.
How The Law Offices of Delton Barnes Can Help
At The Law Offices of Delton Barnes, we understand how stressful and disruptive a lawsuit can be for your business. Our legal team represents North Carolina businesses in all types of civil litigation, from contract disputes and employment claims to premises liability and regulatory issues.
We help clients respond promptly, protect their rights, and develop strategies that align with their long-term business goals. Whether your case can be resolved through negotiation or requires litigation, we ensure your company’s best interests are front and center every step of the way.
You Don’t Have to Face Litigation Alone
Being served with a lawsuit can feel overwhelming, but the right legal guidance can turn a crisis into a manageable process. Acting quickly, staying informed, and working with an experienced North Carolina business attorney are the best ways to protect your business and its future.
The Law Offices of Delton Barnes stand ready to defend your business and guide you toward the best possible outcome, so you can focus on what you do best: running and growing your company.
Your Trusted Legal Partner
The Law Offices of Delton W. Barnes proudly serves the Cleveland, Gaston, and Lincoln Counties in North Carolina. Our team will empower you with expert legal counsel and unwavering support. Whether it’s a business dispute, personal injury, landlord-tenant disputes, or another conflict, our dedicated team is here to guide you through every step.
Call, 704-406-9416 and contact us today to schedule a consultation with one of our experienced attorneys.