You didn’t go into business to spend time in a courtroom. But when a contract falls apart, a partner breaks their word, or a vendor refuses to deliver, legal action might seem inevitable. Before you head straight to court, it’s worth asking: is there another way to resolve this?
In many cases, mediation provides a quicker and more collaborative resolution. In some cases, litigation is the only viable option. Understanding the difference—and the stakes—can protect your time, your money, and your business relationships.
What Is Mediation?
Mediation is a private process where both parties meet with a neutral third party—a mediator—to attempt to resolve their dispute voluntarily. It’s not about winning or losing. Instead, the goal is to find common ground and reach an agreement both sides can live with.
Benefits of mediation include:
- Lower costs than prolonged litigation
- Faster resolution, sometimes in a matter of weeks
- Confidentiality, keeping business issues out of the public eye
- Preservation of business relationships, which can be critical in ongoing partnerships
- Control over the outcome, rather than leaving it up to a judge or jury
Mediation can take place before a lawsuit is filed or during litigation as part of settlement discussions. If it is successful, the parties will sign a binding agreement. If not, litigation may still be pursued.
What Is Litigation?
Litigation is the formal legal process of resolving a dispute in court. One party files a complaint, and the other responds. The case proceeds through motions, discovery, possible settlement talks, and eventually, trial.
Litigation may be necessary when:
- One party refuses to cooperate or negotiate in good faith
- The matter involves extensive financial damages
- There are complex legal issues that require a judge’s decision
- Temporary restraining orders (TROs) or injunctions are needed quickly
- You need the power of the court to compel evidence or testimony
Litigation results in a legally binding judgment that can be enforced through the courts. However, it is generally more expensive, time-consuming, and public than mediation.
When Mediation Might Be the Right Call
Mediation is effective when both parties are open to resolution but require assistance in reaching it. This can include:
- Contract disputes where the core business relationship is still intact
- Vendor or supplier disagreements that require clarity, not hostility
- Shareholder or partnership conflicts that benefit from a more collaborative approach
If you’re trying to avoid burning a bridge—or simply want to keep your legal costs manageable—mediation may be the better starting point.
When Litigation Is the Smarter Move
Litigation is appropriate when the other party is acting in bad faith or when the dispute is too complex or high-stakes for informal resolution. For example:
- A competitor has infringed on your intellectual property
- A partner has committed fraud or embezzlement
- A vendor’s breach has caused significant financial harm
- You need a court order to stop unlawful conduct immediately
In such situations, mediation is unlikely to yield a fair resolution, and delaying litigation could exacerbate the issue.
The Role of Legal Counsel
Many businesses make the mistake of waiting too long to speak with an attorney. By the time they reach out, opportunities for resolution may have already passed. Consulting with a commercial litigation attorney early allows you to:
- Understand your legal position and options
- Calculate the cost-benefit of mediation vs. litigation
- Set the tone with the other party—firm, professional, and focused
At Kohan Law Group, we represent clients across Long Island, New York City, and surrounding areas. We’ve helped resolve complex commercial matters through both negotiation and trial, and we’ll help you choose the approach that aligns with your business goals.
Choosing the Right Path Starts With the Right Advice
No two business disputes are the same, and there’s no one-size-fits-all solution. Whether you want to settle quietly or take decisive legal action, having experienced counsel can make all the difference. We’ll evaluate your case, lay out your options, and move quickly to protect your interests.
Contact Kohan Law Group today to schedule a consultation and find out how we can help you resolve your commercial dispute—on your terms.