One of the most common problems facing businesses is a contract dispute. Finding an informal resolution to the dispute can save in costs, resources, and emotional burden on the company’s leadership. A public battle in the courts may be harmful not just to a company’s bottom line, but also its long term reputation. 

Sometimes, litigation is unavoidable with contract disputes. Three common contract problems facing businesses include:

  1. Breach of Contract Obligations for Payment or Performance

  2. Breach of Confidentiality

  3. Breach of Non-Compete or Non-Solicitation Covenants

What to Do if Your Company is Sued


1. Collect and review the contracts that are at issue.


Check for various versions of the contract, including drafts, revisions, or amendments to the contract. Find any signed versions of the contract or other documents, including emails or text messages, that may have changed the terms of the contract. If there is no signed contract, look for any documents that may help to explain the obligations or terms that the parties agreed upon. 

2. Check whether your company may have insurance coverage to defend and protect you against the claims.


There are many business insurance policies available, including commercial general liability, directors and officers liability, or errors and omissions liability, that may be triggered depending on the claim.


3. Prepare to respond to the complaint.


When a complaint is filed in the civil courts of California, a business must typically respond within 30 days after it is served with the complaint. A corporation or other business entity cannot represent itself in court. It must be represented by an attorney. 

The San Diego-based business attorneys at Garcia Hong Law have represented both sides in litigation. We help businesses evaluate the terms of a contract and a contract dispute. We advise on potential risk and exposure to your business. We provide client-focused and results-oriented strategies to help you get back to business, if that involves settlement or fighting it out in court. Call us at (858) 255-0163 or email us at to speak with an experienced attorney for help with contact disputes. 

* This website is designed for general information only. Results may vary depending on particular facts and legal circumstances.