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How to defend against a partnership dispute

On Behalf of | Jun 24, 2020 | business litigation

A business partnership is often compared to a marriage. A partnership resembles marriage in many ways—close relationships, shared finances, shared responsibility for the “kids”, i.e., employees. And just like divorce, splitting with a business partner can be devastating both personally and financially. So, what if your business partner sues you?


  • In sports sometimes the best defense is a good offense, and it’s also sometimes true in business. Even though at the beginning of a venture all the members, or partners, may have solid relationships with one another, and everyone is optimistic and enthusiastic, almost inevitably disputes will arise and to confront the larger disputes you’ll need a roadmap to guide you.
  • Creating a clear operating agreement at the outset of your business venture is one of the best ways to protect yourself against future disputes. Defining your roles and each partner’s percentage of the business is key. Additionally, your Articles of Incorporation should include an exit clause, which outlines exactly what will happen if one of you wants out of the arrangement.
  • Be a working, knowledgeable partner in your business. For example, periodically review the finances even if you’re not the partner in charge of maintaining the books.
  • Select your legal representation carefully. If your partner moves forward with a suit, hire an experienced attorney who regularly handles business litigation.
  • Be prepared for litigation. An excellent attorney will help you prepare for the meetings ahead. Bring financial records and any other pertinent evidence to relevant meetings so that it is readily accessible.
  • Choose whether it’s worth it to stay. One possible outcome is buying out your partner, but this may or may not be right for your situation.

While a partnership dispute is stressful and problematic, the right preparation and excellent representation can give you an advantage.