Many litigants do not take the demand to mediate as seriously as they should. In many cases, it is not optional and, by ignoring the demand, you can cost your business significantly.

Once you have been served with a lawsuit, you should immediately confer with an experienced business litigation attorney. If you ignore letters from the other side’s attorney, it can put you at risk to pay the other party’s attorneys’ fees if you lose the case. It can also waive your rights to collect your attorneys’ fees if you win the lawsuit. This significantly alters both party’s cost-benefit analysis of litigation.

If your lawsuit involves a contract, the agreement often includes a provision stating that the parties agree to mediate any dispute or claim arising between them or arising out of the contract. Then, the provision typically provides that a party that commences litigation without attempting to mediate the dispute first, or who refuses to mediate after a request has been made, waives the right to recover attorneys’ fees.

The demand to mediate is often made by a letter, not as a filing in the lawsuit. As a result, many recipients of this type of demand letter do not take it seriously and simply ignore it. This is the type of mistake your attorney will ensure that you do not make! Thus, it is essential that you retain your lawyer as soon as possible so he or she can be involved in protecting your rights in every step of the lawsuit.

Failure to retain a business litigation attorney early in the process can mean it is too late for him or her to do anything about a waiver of the right to collect attorneys’ fees for failing to mediate. Not only does the loss of the right to collect your legal fees mean a significant loss monetarily, but it also weakens your leverage in the lawsuit. The threat of liability for your attorneys’ fees can be a critical driving force in a lawsuit. In fact, even if you firmly believe you will be successful in the case, the loss of the threat of

liability for your attorneys’ fees will weaken your position and give the other party an advantage. For instance, if you are suing to recover $75,000, you probably would not spend $100,000 in attorneys’ fees unless you can recoup those legal fees. The other party may intentionally drive up your legal fees in order to have the advantage.

If you are involved in business litigation or you believe a lawsuit is forthcoming, it is crucial to retain a knowledgeable attorney as soon as possible. Contact Mailly Law today to ensure all your rights, including the right to recoup legal fees, are protected.