A business litigation process usually begins with a time sensitive demand letter, which is considered in the world of law as the Lingua Franca of attorneys.
A demand letter is drafted by the aggrieved party (usually the lawyer on behalf of the client) to inform the other party of a clear and defined issue, the latter could take different forms, like the breach of contract, violation of policies, payment default, etc.
This letter serves the purpose first and foremost of giving the party the chance of righting their wrong or complying with the contract at hand. Let’s not forget that in some jurisdictions, a demand letter is a prerequisite to filing a lawsuit.
In business litigation, the demand letter can be part of pre-action protocols, in other words, before initiating commercial litigation, which is such an important step before delving into serious legal proceedings.
The settlement demand is your document to show in court “good faith efforts to resolve the dispute”. Failure to comply with the settlement demand, or conduct a reasonable investigation regarding the material allegations noticed in the settlement demand, is grounds to bring a lawsuit and file the complaint.
Now, this complaint must comply with the FRCP, or comply with California’s Civil Procedure Code.
Following this, discovery takes place, a stage where both parties engage in sharing important and relevant evidence to the case. Both sides engage in discovery in order to prepare for trial, it was mainly designed to avoid what we call “trial by ambush”. So, it is important to note that cases are won and lost in discovery.
Now that we’re in the discovery phase, it is important to delve deeply into its key parties, types of documents and information typically sought, and also the circumstances in which this procedure takes place.
Discovery could, in fact, take a lot of forms, varying from interrogatories, depositions (could involve deposing non-parties under oath using a subpoena). The parties typically engage in settlement negotiations or mediation after all of the depositions have been taken.
The notice for a deposition must comply with the FRCP 30, which must be in writing, it must state the time, the place, and identity of the person to be deposed, if the name is unknown, it should provide detailed description sufficient to identify the individual or the group they belong to. The notice must be served on all parties and the person to be deposed at least 14 days before the deposition, unless otherwise stipulated. However, would be considered disqualified to be deposed, any person who is any party’s relative, employee, or attorney; who is related to or employed by any party’s attorney; or who is financially interested in the action.
As for the interrogatories, they are governed by FRCP 33. They are written questions served on another party in a lawsuit, to be answered under oath, there can be only a maximum of 25 questions that should be answered or objected to within 30 days after being served with the interrogatories. It is important to add that the answers must be signed by the party and the objections as well by the lawyer.
It is necessary to mention the Case Management Conferences (CMC), especially for businesses involved in legal disputes. They serve mainly to streamline the process by setting deadlines for exchanging documents, witness statements, and expert reports, and if possible, the trial date. Which helps a lot in avoiding unnecessary delays and expenses.
In California courts, the court must hold an initial case management conference within 30 days of the filing of the petition or complaint. However, the federal Court routinely issues its notice of Scheduling and Case Management Conference after the Answer is filed by the defendant.
As we already mentioned before, the parties typically engage in settlement negotiations or mediation after all of the depositions have been taken. It goes without saying that mediation is a significant and effective way to solve legal disputes compared to litigation and arbitration, mainly because both parties can shape the outcome of the dispute, since the mediator acts as a facilitator in negotiations by focusing on protecting their interests first, which can lead to satisfactory results.
