The decision to purchase an existing partnership, instead of starting a new business, can offer several advantages. Buying an existing partnership can remove a some of the risk and uncertainty associated with owning a business. The presence of existing customers/clients, long-standing contracts, and a proven track record are all part of the appeal of buying an existing business. In addition, because the partnership structure is already in place, partners can focus on running the business rather than creating it.
There are several litigation risks associated with buying an existing partnership, however. One of the most common litigation disputes stemming from the purchase of an existing business centers around the enforceability of non-compete agreements. When a buyer purchases an existing business, he or she may offer the seller a specific payment in exchange for the seller’s agreement not to enter into a similar type of business within a specific geographic area for a specified period of time.
Oftentimes, disputes will arise regarding the enforceability of such non-compete agreements after the sale has taken effect. Because the laws and legal precedents regarding the enforceability of non-compete agreements is particular complex, you should consult with an experienced business law attorney like the Chicago commercial litigation lawyers at DiTommaso-Lubin. Our civil litigation lawyers focus on helping buyers and sellers of business avoid potential litigation pitfalls in connection with non-compete agreements. If you are already involved in litigation, our Chicago civil litigation attorneys will vigorously advocate on your behalf.
Hidden and Potential Liabilities
Another common litigation risk is the existence of potential liabilities at the time of the sale, including potential employee discrimination lawsuits, breach of contract claims, trademark infringement, and other business disputes. It is absolutely essential to conduct comprehensive due diligence prior to purchasing an existing partnership. A skilled Chicago business law attorney can help you work through the maze of legal documents, contracts, loan obligations, customer and supplier agreements, franchise agreements, and employee relations information so that, as the buyer, you are aware of any potential liabilities that you could be inheriting along with the purchase of the existing business.
At DiTommaso-Lubin, our skilled Chicago civil litigation attorneys focus on representing clients in connection with complex business litigation. We can advise you prior to purchasing an existing partnership about any potential litigation risks, and advocate on your behalf should you face any business disputes following the purchase of an existing partnership.
Contact our office at (877) 990-4990 or (630) 333-0000 to schedule an appointment with one of our knowledgeable Chicago civil litigation attorneys to learn more about the litigation risks associated with buying an existing partnership.