WE TAKE COMPLEX BUSINESS CASES ON CONTINGENCY

The Importance Of Mediation In B2B Commercial Litigation

Name one company willing to burn time, talent, and treasure to enter into litigation when it’s not absolutely necessary… I’ll wait.

While I am not totally discounting the chance of being surprised by a few outliers, I believe that most companies aspire to make smart business decisions and would rather solve disputes without the hassle and expense of lawsuits. Litigation can be costly, time-consuming and emotionally draining for all parties involved.

As the managing member at August Law, PLLC, I’ve witnessed numerous businesses face the challenges of commercial litigation – and they’ve all shared a willingness to seek out alternatives to the traditional courtroom battle.

I’ve come to believe that mediation is a powerful tool that can save time, money, and relationships while reaching satisfactory resolutions for B2B commercial disputes.

Why consider mediation?

  • It’s a collaborative approach.

    To use a boxing analogy, both parties have taken their gloves off, so to speak, when they’ve entered bare-knuckled litigation. Mediation, on the other hand, is an opportunity for both parties to enter into discussions before going to court.

    While feuding parties can sometimes resolve disputes themselves, they usually either sit in a room and stare at each other, or, worse, they scream and yell at each other.  In most cases, the presence of a neutral, third-party mediator can change the dynamic and facilitate discussions. In line with B2B commercial disputes, this is usually a seasoned attorney-turned-mediator who allows open discussion while encouraging both parties to work together to find common ground.  Many of these attorneys have developed skills on how to bring parties together.

    The best part about mediation is that both parties can steer the outcome of their discussion in their favor. No winners, no losers.

    Unlike when businesses litigate, where a judge or jury renders a binding decision, in the case of mediation, there is an opportunity for both parties to reach a mutual agreement that aligns with their interests while addressing their concerns.

  • It’s cost-effective & time-efficient.

    Need I remind everyone how costly litigation can be? There are legal fees, court and outside expenses, experts, opportunity costs, and potential damage exposure to consider. Even multinational conglomerates prefer avoiding litigation – what can you expect for small and medium-sized businesses?

    I have seen how companies involved in B2B disputes struggle with having to go through litigation and the financial burden that comes with it. Mediation, as the alternative, is not only cost-effective but also time-efficient.

    Litigation can take more than 1,000 days to be resolved, whereas mediation can be completed in a few months at most. The faster time frame allows businesses to redirect their resources toward their core operations rather than being tied up in protracted court proceedings.

    In my experience, the process is often best when streamlined. My team and I focus on the key issues rather than delving into lengthy debating.

  • It promotes confidentiality & privacy.

    Mediations are usually held behind closed doors, with details only reserved for those in the room. Some of what is publicly revealed in litigation, most businesses would rather keep confidential. Most times, these details involve financial or proprietary information integral to their business’ success or even embarrassing conduct or facts.

    With this in mind, mediation is often a very appealing and appropriate option for those facing the high probability of B2B commercial litigation. Privacy provides both parties with a sense of security while working towards a solution.

A RECOMMENDED OPTION

As a seasoned expert in business law, I encourage businesses to first consider mediation as a first-choice option for resolving B2B commercial disputes, knowing it offers a powerful and practical path toward resolution and long-term success.  If that fails, however, then be ready to bring in the bare-knuckled brawler.

SOURCES:

Attorney Profile – Gary August. August Law. Retrieved from https://www.august-law.com/garyaugust.

Fotohabadi, M. (2021) Mediation Strategy: 10 Proven Steps to Success. ADR Times. Retrieved from https://www.adrtimes.com/mediation-strategy/.

Geddes, D. (1997) U.S. corporations now widely use Alternative Dispute Resolution over litigation to solve disputes, national survey shows. Cornell University. Retrieved from https://news.cornell.edu/stories/1997/05/survey-also-finds-lack-confidence-qualifications-arbitrators.

Ramadani, D. (2021) The Effectiveness of Solving Commercial Disputes: Alternative Dispute Resolution Vs Commercial Litigation in Kosovo. Rochester Institute of Technology. Retrieved from https://scholarworks.rit.edu/cgi/viewcontent.cgi?article=12084&context=theses.

What is August Law. August Law. Retrieved from https://www.august-law.com/what-is-august-law.

Areas of Practice. August Law. Retrieved from https://www.august-law.com/areas-of-practice.

Please enable JavaScript in your browser to complete this form.
Inquiring about