Litigation is often a slow & expensive process, and not every case will enter into all of these five phases. Only about 1% of civil cases actually go to trial, so it’s likely that your conflict won’t play out in front of a judge or jury at all. And as always, remember that this article is a starting point. This is not intended to replace legal advice from a qualified nonprofit attorney, so please reach out for a consultation if you’re in need of specific legal advice or representation.
Pre-litigation/Investigation
Pleadings
Discovery
Settlement
Trial OR Summary Judgment
Appeals
Pre-Litigation/Investigation
Before the courts are involved at all, something happens to start the conflict. Most of the time, it’s far easier, cheaper, and quicker to find an alternative way to solve the conflict. If the conflict is over money, for example, if that amount is $10,000 or less, it’s likely going to be more expensive to pursue legal action than it will to solve the conflict out of court. Instead, your nonprofit could enlist the help of an attorney to write and send a cease and desist letter or a demand letter. This gives the other party the opportunity to correct their actions before taking things to court. It also can serve as evidence later on that your nonprofit acknowledged there was conflict and attempted to solve it.
In this stage, it’s crucial to keep and save all written records of what’s happening. Whether it’s in emails, text messages, physical letters, or any other form of communication, keep your records.
Pleadings
If the conflict cannot be resolved another way, the lawsuit begins with a plaintiff filing a complaint. A complaint is drafted by your attorney and states the facts of a case, along with the harm that was done, laws that were broken and what outcome the plaintiff is seeking.
For example, if a nonprofit fails to follow its own bylaws, a plaintiff may file a complaint alleging the specific ways that the nonprofit has violated its bylaws and state law, such as failing to provide notice of a meeting, failing to provide records to members, or taking actions that were not first approved by the board.
At this point, the party receiving the complaint is the defendant. The defendant can either file an answer or a motion to dismiss. A motion to dismiss is exactly what it sounds like: it’s a document that argues that the case should be dismissed. They could argue this for a variety of reasons, whether by arguing that the law wasn’t actually violated or that the complaint was filed past the statute of limitations. The motion to dismiss is essentially telling the court that this conflict either doesn’t exist or isn’t worthy of going to trial for whatever reason they outline. If they argue there are issues with the complaint itself, sometimes the court allows the plaintiff to file an amended complaint to correct the issues.
If the defendant doesn’t file a motion to dismiss, they can file an answer, which responds to the concerns in the complaint but doesn’t halt the suit. In the answer, the defendant must respond to every allegation that was outlined in the complaint. They don’t have to agree with the facts outlined in the complaint, but they do have to respond to them, even if their response is a denial.
Discovery
In the next phase, the court will schedule a cutoff date for discovery. Discovery is the (often lengthy) process of gathering information from the opposing party. For example, if your nonprofit is the plaintiff, discovery would involve gathering information in a variety of ways from the defendant you’re suing. When many people think of discovery, they think of tv shows that portray the attorneys surrounded by piles of paper and file folders, sifting through hundreds of documents. But discovery can include a variety of methods of gathering information.
Discovery can include a deposition, which is when one party submits to live questioning under oath. Though depositions have long been in-person, after the events of 2020, many jurisdictions have allowed depositions to happen over video call platforms like Zoom.
Discovery can also include requesting digital information from the other party like emails, texts, or messages from social media platforms. Parties can also request that the other party answer questions in writing under oath.
Requests for Admissions also may occur during discovery. This is when one party asks the other party to confirm or deny the facts of a case, which can help with forming legal strategies if the case goes further. In addition to asking the other party for information, sometimes the sides also ask witnesses for information during discovery.
Settlement
Rather than going to trial, most cases are able to reach a settlement at some point in the process. Settlement can bring a resolution faster and often involves less risk and less cost than going to trial. In cases that involve trauma of any kind, settlement can also be a gentler solution than allowing the trauma to be made into a public spectacle for a jury and media outlets.
Typically in a settlement, one party proposes a settlement amount and provides an argument that outlines why their proposed settlement is reasonable given the facts of the case and the strength of the argument. Settlement can involve the two parties (including their attorneys) compromising with one another directly, or they can involve a third party like a mediator. Once a settlement is reached, it cannot be appealed later. The case comes to a close.
Trial or Summary Judgment
Once discovery is over, if a settlement still hasn’t been reached, the case could either go to trial, or one of the parties can file a motion for summary judgment. A motion for summary judgment is when one party asks the court to make a ruling without a trial on one or more claims. This will be granted if the parties agree on the material facts and the law is clear that one of the sides should prevail. It is possible for some claims to be resolved through summary judgment while other claims remain and proceed to trial.
Now, if no settlement or summary judgment is reached, the case goes to trial. Information is presented in court, witnesses testify, and both parties make their arguments to the court. Trials can include a jury, or can just be heard by a judge, depending on a few factors.
Conclusion
These stages can give you a general idea of what to expect, but each conflict is unique. No matter what kind of conflict your nonprofit is dealing with, it’s important to have the right ally in your corner. If you’re in need of an attorney with experience in nonprofit law, request a free consultation to speak with a Charitable Allies team member.
