What happens when someone gets sued? *

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Where the action is filed.

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It all starts with a Complaint.

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• In North Carolina, like most other states, a lawsuit, formally called a “Complaint,” is initiated when it’s filed in a state or federal court in a location with some relation to the subject matter of the case. 

• Certain types of cases, such as over ownership of real property, must be filed in specific locations, but there is usually a fair amount of flexibility. 

• It’s likely that the person filing the lawsuit has chosen a permissible venue most convenient for him.

• State court cases involving less than $25,000 in damages are filed in District Court, and cases worth more are filed in Superior Court.

 

The consequence of ignoring it.

 

A person or company is “served” with a Complaint, by hand or certified mail. 

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• This is an important step, because proper service is necessary to protect constitutional due process rights. 

• Once served, do not waste time considering whether you should respond or ignore it. 

• Without an extension, a Complaint must be answered within 30 days of service or the filing party, called the Plaintiff, may ask the court to find that the Defendant is in “default” for failing to respond.  

• The Plaintiff must serve the Defendant with a motion for entry of default against him, but once that entry is made, the Plaintiff doesn’t need to serve the delinquent Defendant with any more pleadings. 

• Then the Plaintiff may ask for a “default judgment” for damages that the Plaintiff shows to be reasonably calculable from available evidence.  

• A default judgment is as enforceable as a judgment entered against a Defendant who answered and had his full day in court. 

• Setting aside a default judgment may be possible, but that is far from guaranteed. 

• (If you decide against hiring an attorney, you may represent yourself as a “pro se” litigant, but an individual who is not an attorney cannot represent a company pro se).

 

Considerations before answering.

 

There may be several options for filing a response to a Complaint, depending on its contents. 

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• Questions to ask include whether the Complaint was filed in the proper venue, whether all the necessary parties to the dispute have been included, whether the claims are stated in a manner that complies with the rules and therefore may be subject to dismissal before an Answer is necessary. 

• If it would be advantageous to have the case heard in federal court rather than a state Superior Court, the time limit to act is very tight. 

• Do you have counterclaims?  What are your defenses?  Those are critical issues to decide before answering.

 

The Answer is...

 

Ultimately, if the case isn’t dismissed outright, the Defendant must file an Answer admitting or denying each factual allegation in the Complaint. 

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• A Complaint may contain just one “claim,” which is a legal basis for relief such as monetary damages.

• Most Complaints include numerous claims based on different legal theories of why a Defendant or multiple Defendants should be liable, even for essentially the same conduct. 

• For example, a Plaintiff who bought real estate based on alleged misrepresentations might bring claims against the seller’s agent for fraud, negligent misrepresentation, and unfair and deceptive trade practices.  The same Plaintiff might sue her own agent in the same Complaint for negligent misrepresentation, breach of fiduciary duty, and constructive fraud. 

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Discovery adventures come next.

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The Answer is usually when timelines begin for the parties to engage in “discovery.”

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• That’s the process of exchanging documents and information, taking depositions, and performing the meat of the litigation work before a trial is possible. 

• The discovery process can range from six months to two years or more, depending on issues such as the type of case, the complexity of the issues, the number of disputes over discovery that need to be waged, and the tolerance of the judge or judges for continued delay.

 

Witnesses take the hotseat.

 

All parties should expect to have at least one deposition taken. 

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• A deposition is basically an interview under oath, and it requires preparation. 

• A company’s deposition is taken under a rule numbered 30(b)(6), in which the party asking the questions presents the company’s attorney with a list of topics and the company designates one or more officers or employees to give corresponding testimony about them. 

• The parties usually also take depositions of key witnesses. 

• Depositions can take hours or days, depending, but few take more than a business day. 

 

Pre-trial potshots.

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Parties in a lawsuit typically ask the court to decide some of all the claims at issue in their favor by filing a motion for “summary judgment” when all or most of the discovery process is complete. 

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• That motion essentially tells the judge: “All the important facts about Claim X are in, there is no disagreement about them, and based on the applicable law I should win without having to go to trial about Claim X.” 

• If the judge agrees and dismisses a claim, it’s decided without need for a trial. 

• If the judge decides that there are genuine issues about important facts concerning a claim, then the judge denies the motion and that claim is for trial.

 

Trial is like a box of chocolates.

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• A jury trial hands your case to a group of strangers from the community.

• A bench trial leaves all the decisions to a single judge, and you usually don’t get a choice about which judge.

• Either way, you can never predict just what you’re going to get.

• Only claims involving disputed facts are supposed to go to trial because trial is where the “facts” are decided.

 

Assuming claims survive summary judgment and don’t settle, a trial is where all the work over the previous months or years gets put the ultimate test.