Running a business in Texas comes with inherent risks, including the potential for litigation. Lawsuits can be expensive and time-consuming, making it essential to take proactive steps to minimize risks and respond effectively when disputes arise. At Structure Law Group, our experienced Texas business litigation attorneys are here to guide you through the litigation process and provide proactive strategies to help you avoid lawsuits whenever possible.
With that in mind, here are a few general tips on how you can strengthen your business against the risk of lawsuits:
Properly Structure Your Business
If your business is structured as a sole proprietorship or general partnership, your personal assets are still considered fair game in a lawsuit against your business. The best way to protect those personal assets is to formally organize the business as a corporation or limited liability company. This means not only filing the necessary organizational paperwork with the Texas Secretary of State but also executing corporate bylaws, an LLC operating agreement, and other internal documentation that properly delineates your individual and business roles.
Make Sure Everything Is in Writing
There is often a romantic attachment to the idea of “handshake” agreements or oral contracts. But when it comes to your business, everything you do should be in writing. This starts with having contracts with anyone you do business with. While executing contracts may seem like unnecessary or tedious paperwork, in the long run, they can help clarify your rights and responsibilities, protecting you from the threat of a potential lawsuit.
Have Clear Internal Policies
Similarly, you should properly document your internal business policies in writing. For example, you should have an employee handbook outlining your expectations for everyone who works for your business. Clear policies can help to prevent potential misunderstandings and create a paper trail you can refer to when there’s a dispute.
Safeguard Your Intellectual Property
Every Texas business needs to be proactive when it comes to intellectual property. This includes trade secrets, copyrights, patents, and trademarks. Registering your company’s IP with the government is not enough. You also need to have strong non-compete and non-solicitation agreements with your key employees to help ensure they do not misappropriate your IP during or after their employment.
Hire a Lawyer to Avoid Lawsuits
Running a business in Texas requires careful planning and proactive measures to reduce the risk of costly litigation. By properly structuring your business, ensuring all agreements are documented in writing, establishing clear internal policies, and safeguarding your intellectual property, you can significantly strengthen your legal position and protect your company. While these steps cannot eliminate all risks, they can provide essential safeguards and reduce exposure to potential disputes. For additional guidance tailored to your unique business needs, the experienced attorneys at Structure Law Group are ready to help you navigate the complexities of business litigation and risk management.
Call SLG’s Austin office today at (512) 881-7500 or contact us online to schedule a consultation.