Mediation Blogs

5 Benefits to Pursuing Mediation in Your California Partnership Dispute

Whether you and a friend started a business out of your literal or figurative garage, or you are a seasoned investor in high-stakes business dealings with other industry veterans, a partnership built on professional camaraderie and a shared vision can gradually or suddenly turn into a dispute, putting your interests and the future of the business in the crosshairs.

Litigating against your partners in state or federal courts may in some cases be the only reasonable option for preserving your interests and those of the business, but, in many cases, entering into mediation can provide great benefits in resolving differences and bringing disputes to an end without incurring significant damage to your bottom line or the future of your shared endeavor.

 

Mediation is Confidential

When a partnership dispute enters the stage of having a complaint filed in state or federal court, there will be a public record which can expose at least some information that you would rather keep private, whether that be embarrassing personal information or even internal trade secrets.

With mediation, however, you can keep your dispute 100% confidential – the very fact that you and a partner have entered into mediation can even be kept out of the public eye. The mediator will be bound by confidentiality, and whatever discussions or agreements you can reach can be kept fully within the partnership.

 

Mediation May Save the Business Venture

The purpose of mediation is for the mediator or mediators to facilitate a conversation between the disputing parties to reach outcomes that work for both of them. While litigation can be a zero-sum game with resulting collateral damage, not the least of which can be the ongoing existence of the business, mediation can help you and your business partners find common ground which can produce synergistic results that may build a stronger and more robust partnership than ever before.

 

Mediation is Less Expensive Than Litigation

Mediation is an informal process, usually involving one or two mediators in a single session or series of sessions. As opposed to litigation, mediation is not based on legal filings, in-court arguments, long and expensive periods of discovery, or other evidentiary showings. Furthermore, mediation is not dependent on slow-moving court dockets which keep the business in limbo as the dispute proceeds. As a result, mediation can be less expensive than litigation.

 

Your Attorney Can Advise You Throughout the Mediation

Entering mediation does not, however, mean that you give up the right to retain legal counsel and receive ongoing legal advice prior to, during, and after the mediation. The terms of the mediation session will be up to you and the other party, along with the input of the mediator(s), but in many cases partners are free to bring to their attorneys, or may mutually decide to conduct portions of the mediation without attorneys present.

 

You Retain the Option to Pursue Litigation

Finally, agreeing to enter mediation does not mean that you give up the right to pursue other options such as litigation if the mediation is unsuccessful. Thus, mediation can be an excellent option even if the odds of reaching agreement may feel less than stellar at the outset.

 

Work With an Experienced Los Angeles Partnership Dispute Attorney

At Wagenseller Law Firm in downtown Los Angeles, our attorneys have extensive experience in resolving all types of partnership disputes, including those related to fraud, contractual disputes, and alleged breaches of fiduciary duties. Contact Wagenseller Law Firm today to schedule a consultation to discuss your partnership dispute.

Why Mediation May Be the Best Way to Resolve Your Partnership Dispute

Being in a business partnership has many similarities to being in a marriage. Working together with another party to build a business can be a lot more productive and pleasant than going it alone. At the same time, differing goals, contributions, and values can collide when two or more parties have to work together towards a common purpose. And perhaps nowhere is the analogy between a partnership and a marriage more apt than when potentially irreconcilable differences arise; just like in a marriage, two business partners often cannot simply walk away from each other and move on, and instead have legal rights and obligations that must be worked out.

And just as divorcing spouses find that pursuing mediation is often far more fruitful and less damaging than litigating their issues, business partners facing partnership disputes – whether they lead to the end of the partnership or not – can also find far better outcomes through pursuing mediation to resolve their differences.  

You Don’t Necessarily Need a Judge to Explain Your Partnership Rights and Obligations

When a partnership dispute arises, there are basically two general methods for resolving the dispute: 1) have a neutral third party (in the form of a judge or an arbitrator) decide the outcome based on the law and facts, or 2) have the parties involved figure out a resolution to the situation, which could be done through mediation and/or negotiation.

The fact of the matter is that the vast majority of partnership disputes do not present novel and complex questions of law such that it is necessary to bring in a judge to untangle the legal issues. When parties and their attorneys can be forthcoming and clear-headed about the law and the facts, working together to create a solution that is fair on the law and the facts is attainable.

Of course, tensions and self-serving actions can complicate this process, but the job of a good mediator is to cut through those issues to help both parties reach a mutually beneficial outcome.

Litigation is Expensive and Lengthy

It should come as no surprise that some of the key benefits of pursuing mediation over litigation is that mediation gives partners the ability to move past partnership disputes without the high costs of trial prep and going to trial and the long process of partnership litigation, which can continue for months and even years.

With mediation, the parties are in control of the timeline and have the ability to end the dispute at any point, so long as they are willing to work with the mediator and the other party.

Mediation Lets You Craft Your Own Resolution

Again, a foundational question in any partnership dispute is whether you are going to seek to have a third party such as a judge impose an outcome on your disputes issues, or whether you and the other partner can craft outcomes (with the assistance of a mediator and your attorney) to resolve those differences.

Many business partners became entrepreneurs for the very reason that they did not want to work for others and instead wanted to become the authors of their own stories. For this reason, business partners often find more satisfying resolutions to disputes when they themselves are the architects of the outcomes for their business.

And while the idea of working with a business partner in a heated dispute may seem unpleasant and even impossible, an experienced mediator and partnership dispute attorney can help even the most estranged partners in crafting customized solutions to their issues.

Work With an Experienced Los Angeles Partnership Dispute Attorney

At Wagenseller Law Firm in downtown Los Angeles, our attorneys have extensive experience in resolving all types of partnership litigation matters, including those related to fraud and alleged breaches of the duty of loyalty and duty of care. Contact Wagenseller Law Firm today to schedule a consultation to discuss your partnership dispute.

Does Mediation Signal Weakness?

“I don’t care how much it costs.  I want you to sue them and I want you to be aggressive.  I don’t want you talking to the opposing attorney.  I want to serve them with papers.”

Parties in family litigation and partnership litigation usually come to me with one overriding instruction–fight regardless of cost.  Like the ancient Spartans, the instruction is usually to come back with your shield (i.e., victorious) or on it (i.e., you died trying).  In highly emotional litigation between family members or business partners, new clients are often almost universally opposed to mediation.

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