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Preparing your small business for the threat of a lawsuit

On Behalf of | Jan 6, 2023 | Business Litigation

Most people hear the term “business litigation” and imagine lawsuits against major corporations. Unfortunately, small business owners also commonly face legal actions. While major corporations typically keep a team of legal counsel on staff, small businesses do not. However, there are still smart steps small business owners in Texas can take to protect their company in case an employee or customer threatens legal action.

Business insurance

Business insurance serves as an important protection against business lawsuits. Specialized coverage options can cover liabilities unique to your entity. Insurance can cover issues like slip-and-fall incidents, property damage or even hackers or cyber attacks that affect customer information or company data.

Entity selection

The entity you choose when first setting up your business can also help shield you from personal liability in the event there is a lawsuit against your company. There are a variety of options, each with pros and cons.


Whether you are advertising or speaking one-on-one to a customer, be careful about what you promise, as you could misrepresent what your product or services do. Customers could attempt to pursue a lawsuit against your entity if they feel it made a promise that wasn’t delivered. Training employees about this can help mitigate this from occurring.

Facing a threat?

While unfortunate, threats of legal action are common in business. If anyone makes a threat to pursue business litigation, reaching out to a qualified attorney knowledgeable with business law in your jurisdiction is advised.