6 Ways to Minimize Business Litigation Costs

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Litigation is an expensive, tedious, and often highly stressful experience. This is why most businesses aim to settle disputes through mediation, which is a less expensive and less drawn-out method of dispute settlement. However, going through this route is not always possible. And in many cases, business owners are faced with unpredictable litigation that can cost their business in more ways than one.

Litigation costs are notoriously high. Nevertheless, there are concrete ways with which you can reduce litigation expenses and minimize the overall impact on your company, such as:

1. Have a lawyer on stand-by

It is ideal to have a business attorney on stand-by in case you run into problems like this. They can provide immediate illegal assistance that significantly reduces litigation costs in many ways. For one, consulting with a lawyer as soon as you are notified of the lawsuit will help you make cost reduction strategies early on; something that is not always possible for companies that wait until the last minute to hire a lawyer. Moreover, hiring a business lawyer to be your stand-by legal counsel can afford you lower rates, especially when you negotiate cheaper per hour rates in exchange for a minimum number of hours a year.

2. Choose the right legal counsel

Choosing the right law firm significantly impacts the turnout of your lawsuit, particularly when it comes to expenses. Ensure that you select a law firm that has enough experience, the right specializations, and a good reputation in the community. Not only will this help you minimize the financial impact of litigation on your business as a whole, but it is often necessary to protect your business’ reputation from further damage.

If you already have a business lawyer on stand-by but they don’t specialize in the kind of lawsuit you’re faced with, consider hiring another lawyer that does. For example, if you are facing a personal injury case, look for a trusted personal injury lawyer that has the skills and experience to deal with it more effectively.

3. Negotiate fee arrangements

Besides an hourly rate, which is the standard fee arrangement of many lawyers, ask your lawyer for alternative fee options, such as fixed fees or fees based on the outcome of the case. Choose the most cost-effective fee arrangement option for the particular workings of your case.

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4. Try for alternative dispute resolution

Alternative dispute resolution (ADR) is the process of settling disputes without litigation. ADR is usually less expensive, stressful, and drawn-out. We’ve mentioned before that it’s not always possible to go through this route of dispute settlement. But at some point during the litigation, you may be offered the option (or see a window of opportunity to present the option yourself) to have alternative dispute resolution.

If you and your lawyer believe that a settlement will decrease your legal costs significantly without causing unnecessary harm to your business, it is highly advisable to grab the opportunity. However, it is still ideal to have an attorney represent you during meetings. They can help you negotiate with the other party and strategize for the best outcome possible.

5. Have an action plan

Ask your legal counsel for an action plan that details how they plan to handle the case. Each major phase of the plan should have deadlines that should be met unless unusual circumstances arise and cause a delay. Go over this action plan with your counsel and don’t hesitate to ask questions about the items outlined in the plan, particularly their necessity or cost.

Unnecessary actions and missed deadlines are some of the biggest reasons for increased litigation costs, so as much as time allows, take involvement in the planning. At the same time, don’t be afraid to negotiate with your lawyer to have costs docked off the final bill as long as your requests are within reason.

6. Mandate reports on expected costs

Require your legal counsel to provide periodic reports on expected litigation costs. While it is not possible to get accurate estimates since no one knows how the litigation will unfold, you can reduce legal expenses by knowing what your lawyer is planning to spend on in advance and asking them if you can reduce those costs.

Similarly, you must also require a report on money that has already been spent or billed. Review these expenses carefully and keep a lookout for increasing costs to ensure that there are no surprises along the way.


Litigation can bleed money out of your business faster than anything else. But with early planning and strategizing, you can significantly reduce the blow that the lawsuit brings on your business. Use these tips to keep your legal expenses as low as possible–but without hurting your chances of winning the case.

About Sarah Bennett 416 Articles
Sarah is a highly experienced legal advisor and freelance writer. She specializes in assisting tech companies with the complexities of the law and providing useful information to the public through her writing.