Notes:
For a tiny company, we've been hit pretty hard on the legal front. Not many
startups receive an SEC letter or are hit with a lawsuit in their first two
years.
In the last three years, we have been hit with two lawsuits for breach
and had to file a complaint for non-payment. We went to the court for
the latter and won with a full award (attorney's fees, costs, and
interest), and are in the process of collecting (May 2010).
We settled a suit with our only competitor in one market, and that
competitor was bought by our only channel partner a couple of months
later. We terminated channel partner contract, but are now being
sued for breach. While it may seem obvious to outsiders, the law
does not exist until there is a judgement, literally.
Anybody can sue anybody for anything. It may be thrown out, but it
still costs real money to defend yourself.
The settlement was a mistake, which sort of knew at the time (we
would have won our case), but our lawyers pressed us to settle
for "certainty". While that's an important concept, you have
to get in the heads of the opposing party. It's quite like
poker, but the stakes are higher, and the data are thin. You
don't get to see hundreds of lawsuits play out.
Use your resources wisely. Take your time. Try, try again does
not apply here. Analysis and logic do.