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Mohsen Parsa, Inc.

How to Manage Your Business Through a Legal Emergency

At some time, every business will suffer some kind of crisis or emergency. The nature of potential emergencies is as varied as the nature of businesses. A crisis can disrupt your business’ operations, threaten to harm people, damage your reputation, and negatively impact your finances.

You are likely already aware of many of the things that can go wrong and you, hopefully, already have plans in place for how you will deal with these emergencies. But you may not have a plan for what you will do in the case of a legal emergency.

What is a legal emergency?

A legal emergency is a circumstance that requires you to act fast to cover your businesses’ interests in matters related to civil litigation

What matters most is that you prepare in advance for what you will do to manage the crisis. Emergency planning begins long before an issue occurs. No one wants to think about what-ifs when business is operating smoothly, but putting off emergency planning can have serious operational, legal, and public relations consequences.

In the business world, anything that involves your business’ legal standing, that invites litigation, or that challenges established can constitute a legal emergency. Some worst-case scenarios could involve product recalls, allegations of a failure to warn, trademark disputes, or claims of sexual harassment or an otherwise hostile workplace. Any of these situations could prove to be catastrophic or even fatal to your company brand and future earnings.

In the 1980s, corporate giant Johnson & Johnson was hit with a business-defining crisis. Seven people were killed after purchasing bottles of Tylenol that contained capsules that were laced with cyanide. Johnson & Johnson quickly recalled all Tylenol capsules in circulation and worked with FDA officials to create new tamper-proof packaging, while their legal team deftly handled the unavoidable lawsuits. Forty years after they masterfully handled the emergency, Johnson & Johnson is still generally trusted and viewed positively.

Creating a Plan

Obviously, the best way to handle a legal emergency is to never have one, but no matter how careful and cautious you are, mistakes are bound to happen. By preparing before they happen you will be best positioned to respond in a way that minimizes damage and allows you to resume business as usual, as quickly as possible.

Step One: Think about the emergencies you are likely to experience.

Your business, your employees, and your market are all unique. Your challenges are likely to be unique, too. Spend some time thinking through what could wrong that would require immediate action.

Step Two: Assemble a Crisis Team

As you think about what might go wrong, think about who on your existing staff is best poised to handle it. If your staff is small, or you don’t have someone skilled in crisis management, consider who you might hire to help you. Think about the aspects of emergency response that will need to be addressed and who can best address them.

Step Three: Establish a relationship with a lawyer who knows how to manage legal emergencies.

It’s important to create these relationships in advance. Just as you don’t do estate planning after you die, you don’t want to be hiring a lawyer in the middle of an emergency. By meeting with a lawyer and discussing your business and all that could wrong in advance, when the emergency hits, you won’t have to start from the beginning. Your lawyer will be able to jump right in and start protecting your interests. A carefully considered plan will make managing a legal emergency must smoother for you, and make enduring the crisis much easier.

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