Posts Tagged ‘sunday special’

Sunday Special: Learning from Lawsuits

November 16, 2008

I write a lot about recently filed lawsuits, mostly class actions focused on bad business practices.  I think lawsuits are a window into a company, a relunctantly revealed window and sometimes distorted or even inaccurate view on how a company operates.  Here are four things to consider about a sued company when reading the complaint.

*Actual corporate name: many businesses don’t want you to know their product line or their doing business name.  It useful to peel that away and understand that what you thought was a mom and pop provider of lemonade is actually a conglomerate, selling insurance or tanks as well as the product you love so much.

*State of incorporation: maybe you’ve had a problem with the company too and if you know the state where the company is incorporated you can search that state’s secretary of state records and find out who the contact is to sue.

*Product or service in question: maybe you were thinking about buying a washing machine from this company and the complaint tells you that they’ve blown up in customer kitchens and that the company has claimed it was the customer’s fault.  That might make you think twice from buying that brand.

*Who else got sued: In product cases, its common for plaintiffs to sue competitors, component part manufacturers, whole-sellers, distributors and retailers.  Just by reading the defendant names and how they are connected in the manufacturer, distribution and sales of a product, you can understand very quickly the inter-relationships between key players and have gather critical industry intel in a couple minutes.