If you are about to become a litigant in a commercial lawsuit, you may be wondering what to anticipate as your cases progresses. A commercial lawsuit may pass through up to eight phases: pre-filing strategy; pleadings; discovery; summary judgment; pre-trial conference; trial; post-trial motions; and appeal. However, the vast majority of suits are settled or otherwise resolved before they get to the trial phase.
Here is an overview of the purposes and key activities of each phase.
- Pre-Filing Strategy
Pre-filing strategy is one of the most critical phases of a commercial lawsuit because sometimes the most efficient lawsuit is the one that is never litigated. If you and your counsel can establish an early advantage by prioritizing information and accumulating evidence, you can mitigate efforts and costs later in the process. There are many steps that include: issuing litigation holds to preserve relevant information, instructing employees to keep the dispute confidential, evaluating insurance policies, and reviewing applicable contracts to determine remedies and liability exposure.
This phase allows for basic case assessment and fact gathering before filing a complaint or receiving one that requires an answer. Here, you and your attorneys will want to investigate, gain a deeper understanding of the key legal issues that serve as the basis for the claims, and familiarize yourself with who the players are (e.g. judge and opposing counsel), prepare a litigation budget, and assess public exposure and risk to reputation.
This is also the most viable opportunity for the parties to opt for a business solution instead of a legal battle because both parties are not “pot-committed” to litigation. Consult with your attorney on the facts that gave rise to the lawsuit. This is the time to interview witness, conduct legal research, and evaluate if litigation is preferable to settlement, which could mean walking away from the issue entirely.
- Pleadings and Pre-Trial Motions
The pleadings consist of the complaint the plaintiff files in court and the defendant’s response. Defendant may simply answer the complaint, but if the defendant believes the plaintiff’s claims are unfounded, the defendant will often file a motion to dismiss the complaint. If the court grants the motion to dismiss, the case effectively ends. The problem for defendants is that absent some exceptional circumstances, the court will grant the motion to dismiss without prejudice, which allows the plaintiff to correct any deficiencies. Other pretrial motions such as motions to strike particular claims or motions addressing allowance of particular types of damages (e.g. indirect damages) are also often filed at this point. If your case is based on a contract that contains an arbitration clause, this would be the prime opportunity to request the court to compel arbitration. If you are in New Jersey state court and you and counsel determine it would be advantageous to your defense, now is when you would generally file a motion to remove the case to federal court.
The defendant generally files its counterclaims at this time when it answers the complaint. This can put the plaintiff on the defense and escalate settlement discussions. The defendant may also file cross claims with other parties who may be liable to the plaintiff and join other parties to the lawsuit. This stage identifies the claims and the parties to those claims who are stakeholders in the dispute. If the lawsuit is to proceed as a class action, the court must certify the class presuming the complaint survives any challenges by the defendant.
Often the most grueling and costly part of litigation, discovery is the process where each side discloses information to the other side. Early in the case, the parties have a conference where the parties discuss the nature and basis of the parties’ claims and defenses, the possibility of settling or resolving the case, and what the plan is for disclosure (e.g. what will the scope be of electronically stored information). This is referred to as a Rule 26(f) conference. Discovery is generally broad so before discovery formally begins the parties make initial disclosures that include witness information, a description of all electronically stored information that the party, and expected damages to be claimed.
Discovery takes several forms. Requests for production of documents, requests for admissions, interrogatories, depositions, and retaining expert witness are all methods of obtaining information to bolster your case. Consult with your attorney on which methods will yield the most information for the cost involved.
- Summary Judgment
After discovery, the court will adjudicate the case at the summary level. Each side may file a motion to end the case based on the facts and relevant law. If the court determines there is a question about what the evidence would show or how a jury would evaluate it, the court will generally allow it to proceed to trial. Each party shows what they would ultimately rely on at trial so the parties gather a good indication of what they will need to argue against at trial.
- Pre-trial Conference
If the court declines to enter summary judgment in favor of a party, the parties prepare for trial. Generally, both sides will attempt to demonstrate how prepared they are to see the case through to a final judgement. The sides may discuss evidentiary issues, file motion in limine to preclude evidence from being admitted, file motions for draft jury instructions, and consolidate witness information.
The plaintiff will put on its case in order to prove its claims as laid out in the complaint. Both sides will have the opportunity to present evidence and demonstrate to the jury or the judge that their position should prevail. This is also where the damages are ascertained by the jury or judge. Depending on what the claimant is seeking, remedies can include equitable remedies such as injunctive relief as well as monetary compensation.
Post-trial motions notably attempt to reverse the court’s judgment or provide new evidence that compels the court to reconsider another trial on the merits. Post-trial motions can linger depending on the complexity of the case and the resources of the parties.
Appeals are filed with another court that will review the trial court’s decision. Considering an appeal requires a careful examination of what errors the trial court may have committed. First you will need to consult with your attorney about what is an appealable judgement and whether the appeal is based on judgment of the facts or the legal principles underlying the facts.
In New Jersey, an appellant must file an appeal within 45 days after final judgment of the court. The timeframe may be extended by the court granting a motion to extend. Your counsel must serve a notice of appeal, prepare a case information sheet, and a request a transcript of the trial court record. These documents are then filed with the appellate court. The costs to assemble those documents can be significant, even before getting to drafting of a brief.
Generally there are three briefs that counsel draft for the appellate court’s review. The appellant (party taking the appeal who is aggrieved by the result in the trial court) files a brief addressing the issues that party wishes to appeal. The opposing party, the respondent, then presents counterarguments to that brief. Sometimes, the appellant will subsequently file a response to those counterarguments. A party may then request oral argument or if either party does not request oral argument, the appellate court will decide on the briefs thereby expediting the appeals process.
Even after the court decides the appeal, a party with an unfavorable ruling may file a motion for reconsideration, which can extend this phase.
If you are mired in a business dispute, call Snellings Law LLC at 973.265.6100. We are prepared to assist you through all phases of a commercial lawsuit. We handle a broad variety of commercial litigation matters including breach of contract, real estate disputes, consumer fraud, banking disputes, and construction liens.