Business owners might not be aware of the benefits of mediation in shareholder disputes, but the process can be rewarding. While they are not successful 100 percent of the time, mediation can save considerable time, effort, and money. Keeping an open mind about this is wise because it can prevent your business from entering lengthy, challenging litigation.
Mediation can be effective when disputes over compensation, succession, and work responsibilities arise. Shareholders can also have issues with their suppliers regarding pricing, quality of goods and services, quantity, and timeliness. Another topic that causes disagreements is shareholder derivatives. When these problems cannot be solved in boardrooms or through other means, a neutral, third-party mediator can guide the parties to an acceptable resolution.
Here are three key mediation benefits:
- It provides a learning experience. Mediation sessions allow parties from both sides to meet face-to-face to see how everything is thinking, and this open communication can give insights into thought processes. You may learn why others are taking hard lines on some topics and be willing to negotiate with others. Mediation can also provide access to information you were unaware of before the meeting.
- Mediation is typically faster than litigation. Shareholder litigation can take months and years. It can even impact shared values when outside parties become aware of significant disputes.
- It can be cost-effective. Mediation typically costs much less than litigation because there is less preparation and time spent overall. Lengthy court cases can drain resources from your business – financial and time better spent elsewhere.
There are other benefits to mediation as well. Mediations are private, unlike litigations that take place in court and become public knowledge. Confidential business information like financial details and internal operations are not shared with third parties, so your company’s reputation is not at risk.
Mediation is also more amicable than litigation, which can significantly strain future shareholder activities. In the best-case scenarios, mediation can strengthen long-term relationships for the participants.
Even though the mediator guides the process, it will be flexible and tailored to your situation. Mediators and lawyers share their advice and help the shareholders create practical solutions that might not be offered through litigation. The shareholders contribute to the process and agree on the final decision.
Can a Lawyer Help With Mediation?
An attorney with experience in mediation can help with the process and protect your best interests. Look for lawyers who are open to creative solutions and can clearly explain them. Feel free to consult several attorneys and choose one who is right for you and your business.
Our Philadelphia Shareholder Dispute Attorneys at The Gold Law Firm P.C. Can Explain the Benefits of Mediation
Contact our experienced Philadelphia shareholder dispute attorneys at The Gold Law Firm P.C. for a free consultation, and we will explain the benefits of the mediation process. Complete our online form or call us at 215-569-1999. Located in Philadelphia and Pennsauken, New Jersey, we serve clients in South Jersey and Southeastern Pennsylvania, including Wilkes-Barre, Scranton, Northeast Philadelphia, Bucks County, Chester County, Delaware County, Lehigh County, and Montgomery County.
