Navigating a business dispute through the court system can be a complex and intimidating experience. Understanding the business litigation process from start to finish is critical for protecting your company’s interests and making informed decisions. Whether you’re initiating legal action or defending against a lawsuit, having clarity about the steps involved can reduce uncertainty and allow you to respond strategically.
This guide, crafted with the insights of experienced Michigan business litigation attorneys, walks through each stage of a typical commercial lawsuit. From initial consultations to potential appeals, we explore what you can expect, how to prepare, and how each phase contributes to the outcome of a case.
Please note this blog post should be used for learning and illustrative purposes. It is not a substitute for consultation with an attorney with expertise in this area. If you have questions about a specific legal issue, we always recommend that you consult an attorney to discuss the particulars of your case.
Initial Consultation and Case Evaluation
The litigation journey begins when a business identifies a potential legal dispute that cannot be resolved informally. At this point, the business owner typically seeks the guidance of a litigation attorney to evaluate the issue. During the initial consultation, the attorney carefully reviews the relevant facts, any contractual documents, prior correspondence, and other evidence that could influence the case. They also work to understand the client’s objectives, whether that’s monetary damages, injunctive relief, or a simple resolution to move forward.
This evaluation is not just about determining whether a case exists, but also about assessing the strength of the legal claims and potential defenses. Attorneys provide clients with a candid overview of the legal merits, estimated costs, likely duration, and possible risks. A well-informed client is better equipped to decide whether to pursue business litigation, consider alternative dispute resolution, or resolve the issue outside of court. This stage sets the foundation for everything that follows.
Pre-Litigation Negotiation and Settlement Attempts
Before heading to court, parties in a dispute often engage in direct or attorney-led negotiations in an effort to resolve the matter amicably. This phase is referred to as pre-litigation settlement discussions. Attorneys may exchange demand letters outlining their client’s position and seeking a resolution, often accompanied by proposed settlement terms. These negotiations can save both parties significant time, expense, and stress.
If a resolution is reached during these discussions, the terms are typically documented in a binding settlement agreement. Such agreements may include payment terms, confidentiality clauses, non-disparagement provisions, and other stipulations that reflect the negotiated resolution. If no agreement can be reached, or if the other party refuses to negotiate, then litigation may become necessary.
Filing the Complaint and Service of Process
The formal business litigation process begins with the filing of a complaint in a Michigan state or federal court, depending on the nature and jurisdiction of the case. The complaint is a legal document that outlines the plaintiff’s claims, the factual basis for the lawsuit, and the specific relief or remedy being sought. Once the complaint is filed, the court assigns a case number and sets initial deadlines.
To proceed, the plaintiff must serve the complaint and summons on the defendant. This is known as “service of process” and ensures that the defendant receives formal notice of the lawsuit. Proper service is critical if it is not executed in accordance with Michigan law, the business litigation case may be delayed or even dismissed. Once served, the clock begins ticking for the defendant to respond.
Defendant’s Response and Preliminary Motions
After being served, the defendant has a limited time (usually 21 or 28 days in Michigan, depending on the method of service) to respond to the complaint. The response usually comes in the form of an “answer,” in which the defendant admits, denies, or claims insufficient knowledge to respond to each allegation in the complaint. The answer may also include “affirmative defenses” legal arguments that, if proven, would negate or reduce liability even if the plaintiff’s claims are accurate.
Alternatively, the defendant might file a motion to dismiss, arguing that the complaint fails to state a valid legal claim or that the court lacks jurisdiction. These preliminary motions can be critical in shaping the litigation, narrowing the issues, or even disposing of the case early if granted by the court. Whether the defendant answers or moves to dismiss, the stage is then set for the most intensive and often time-consuming phase: discovery.
Discovery Phase: Exchange of Information
Discovery is the backbone of business litigation. This phase involves the formal exchange of evidence between the parties, allowing each side to investigate the facts and assess the strengths and weaknesses of the opposing case. Discovery tools include written interrogatories (questions that must be answered under oath), requests for production of documents, and requests for admission (which ask a party to admit or deny certain facts). In many cases, the parties also conduct deposition sworn, out-of-court testimony by parties or witnesses, recorded by a court reporter.
Discovery can last several months to over a year, depending on the complexity of the case. Disputes often arise about what information must be disclosed, leading to motions to compel discovery or protective orders. Attorneys must be diligent in obtaining and protecting critical information, as the facts uncovered during this phase heavily influence the prospects for summary judgment or settlement.
Pre-Trial Conference and Motion Practice
As the trial date nears, courts often schedule one or more pre-trial conferences to ensure both parties are on track. During these sessions, the judge may encourage settlement, address pending motions, and establish a final timeline for pre-trial disclosures. Parties typically exchange witness lists, exhibit lists, and may submit trial briefs summarizing their legal arguments.
Attorneys may also file dispositive motions, such as a motion for summary judgment, arguing that the facts are undisputed and the case should be resolved as a matter of law. These motions aim to avoid trial entirely or at least narrow the scope of issues. Pre-trial motion practice can significantly influence the final outcome, resolving legal questions that would otherwise be presented to a jury.
Trial: Presentation of Evidence
If the case is not resolved through motion or settlement, it proceeds to trial. In business litigation, trials may be held before a judge (bench trial) or a jury, depending on the legal issues and preferences of the parties. At trial, each side presents opening statements, calls witnesses, introduces exhibits, and cross-examines the opposition’s witnesses. The burden of proof rests on the plaintiff to prove their claims by a preponderance of the evidence.
Trials can last anywhere from a single day to several weeks, particularly in complex commercial disputes. After the evidence is presented, attorneys deliver closing arguments to summarize their cases and persuade the decision-maker. The judge or jury then deliberates and renders a verdict, which may include monetary damages, injunctive relief, or other remedies depending on the claims.
Judgment and Post-Trial Motions
Once a verdict is issued, the court enters a final judgment reflecting the outcome of the trial. But business litigation doesn’t always end there. The losing party may file post-trial motions seeking to set aside the verdict, reduce the damages awarded, or request a new trial based on procedural errors, newly discovered evidence, or other grounds.
These motions must be filed within specific timeframes and are evaluated by the trial judge. Although post-trial motions do not always succeed, they can be pivotal in shaping the outcome and determining whether an appeal is warranted.
Appeal Process
When a party believes that significant legal errors occurred during trial, they may appeal the decision to a higher court. In Michigan, appeals from trial courts are generally heard by the Michigan Court of Appeals. The appellate process focuses strictly on legal questions whether the trial court applied the law correctly not on disputes about factual findings or credibility.
Appeals require careful briefing and may include oral argument before a panel of appellate judges. The appellate court can affirm the trial court’s decision, reverse it, or remand the case for further proceedings. If a party remains dissatisfied, they may seek review by the Michigan Supreme Court, but that court selects only a limited number of cases to hear each year, typically those involving novel or significant legal issues.
Enforcement of Judgment
Winning a business litigation case and obtaining a judgment is only part of the story. If the losing party fails to comply voluntarily, the prevailing party may need to initiate enforcement actions. These may include wage garnishments, bank account levies, or liens against real estate or other property owned by the debtor.
The enforcement process in Michigan is governed by specific rules and timelines and often requires coordination with court officers or sheriffs. In cases involving significant monetary judgments or evasive debtors, enforcement may become a legal process of its own, requiring ongoing attorney involvement.
Alternative Dispute Resolution (ADR)
Throughout the business litigation process—and often before it begins—parties may explore alternative dispute resolution (ADR) options such as mediation or arbitration. These processes can provide faster, more cost-effective solutions than traditional court proceedings and may offer more privacy and flexibility.
Mediation involves a neutral third party who facilitates negotiations between the parties, helping them reach a mutually acceptable agreement. Arbitration, by contrast, more closely resembles a trial, with an arbitrator acting as a private judge. In some contracts, arbitration is mandatory. Michigan courts frequently encourage or require mediation prior to trial to reduce backlog and promote resolution. In many cases, ADR leads to creative solutions that might not be available through litigation alone.
Conclusion
For Michigan business owners, business litigation can represent both a threat and an opportunity. Whether you’re enforcing contractual rights, defending against unfounded claims, or trying to resolve a commercial dispute, understanding the steps in the litigation process is essential. Each stage—from pre-suit evaluation to enforcement—demands strategic thinking, legal expertise, and a clear understanding of your objectives.
By working closely with a qualified business litigation attorney, you can navigate these stages with confidence and clarity. While litigation can be complex and costly, it remains a powerful tool for resolving disputes and protecting your business interests when other efforts fail.
Contact Tishkoff
Tishkoff PLC specializes in business law and litigation. For inquiries, contact us at www.tish.law/contact/. & check out Tishkoff PLC’s Website (www.Tish.Law/), eBooks (www.Tish.Law/e-books), Blogs (www.Tish.Law/blog) and References (www.Tish.Law/resources).
Sources
- Michigan Court Rules – State of Michigan Judiciary https://www.courts.michigan.gov/rules-administrative-orders-and-jury-instructions/current-rules-and-jury-instructions/michigan-court-rules/
- Michigan Judicial Institute – Civil Proceedings Bench book https://www.courts.michigan.gov/publications/benchbooks/mji-benchbooks-and-qrms/
- American Bar Association – Business Litigation Basics https://www.americanbar.org/groups/business_law/business-litigation-dispute-resolution/
- Michigan State Bar – Civil Litigation Guidelines https://www.michbar.org/civildiscovery