Cannabis businesses face various threats, from security to product liability lawsuits. Consulting a cannabis business attorney can help identify the key threats and ensure adequate protection measures. Cannabis businesses should also keep tabs on the changing laws to avoid leaving openings for lawsuits. Here are five ways to protect your cannabis company from lawsuits.
Hiring an experienced cannabis business lawyer is the first thing you should do to protect the company from a lawsuit. The attorney can review existing contracts and setups to ensure the business complies with all existing regulations. A lawyer will also represent the business in case of an issue and help prevent a trial.
Cannabis businesses should engage experienced attorneys specializing in liability lawsuits and business protection. Hiring an attorney prevents mistakes and omissions that can result in a case. Lawyers can also straighten up the contracts to ensure the business is safe from liabilities belonging to other parties.
Cannabis businesses can have several measures in place to avoid liability and still face a lawsuit. If a settlement is inevitable, the insurance coverage will protect business finances from settling cases. A cannabis business needs various insurance policies, including product liability coverage and commercial general liability.
Product liability insurance protects the business against suits arising from cannabis products. Popular suits include bodily injuries and property damage attributed to product defects and malfunction. Commercial general liability protects the company if it is found liable for injuries, property damage, and advertising injury.
Labeling mishaps can result in costly lawsuits. Your business may lose its license if found guilty of inaccurate descriptions and advertisements. Cannabis businesses should clearly understand their products and provide accurate representation on all product labels. The type of cannabis product will determine what labeling information is necessary.
Companies selling cannabis products have a higher risk of facing labeling issues and lawsuits. The labels should be accurate and informative as required by existing laws. A cannabis business lawyer can help identify the company’s labeling responsibility and protect the business from specific labeling liabilities.
Cannabis businesses need indemnity provisions across all stages of the supply chain. The provisions protect the company when other parties to the contract are at fault. Defining the indemnity in all relevant agreements can allocate risk and expenses when there's a breach. It can also force other parties to compensate the business for losses stemming from a lawsuit.
A typical contract provision is to have counterparties obtain insurance and add your business to the additional named insured. The insurance will cover financial losses while adding your business to the named insured entitles you to the same coverage. Cannabis business lawyers should scrutinize all contracts to include such provisions.
Lawsuits are common and can happen to any company, especially cannabis businesses. The company should react quickly and efficiently to issues by lining up its defence counsel. An experienced business attorney makes the process less stressful and gives you an upper hand when dealing with lawsuits.
A cannabis business lawyer is invaluable when dealing with business security lawsuits, product liability, or telephone consumer protection act cases. At Khader Law, we provide experienced attorneys and unique services. Our team is ahead of the curve in commerce and law and serves all clients through our NY law office.