24 Jun Know Your Opponent Before Litigation Ensues By Doing a Public Records Search

In the past six blogs, we have discussed at length steps you and your company can take to prevent and/or prepare for litigation to make it less costly.  From legal process improvement to properly drafting the arbitration provision in your business contracts, every little step in the planning process could ultimately mean the difference between your business staying afloat in the wake of protracted litigation or closing its doors due to litigation costs.  One of the most obvious steps you and your business can take to prevent litigation is to research your clients and business partners, via a public records search, before entering into a business contract with them.  Going with your gut is typically helpful, but also conducting some level of public data research on these parties could save you and your business a lot of headache and attorney bills in the future.

But what if an otherwise great business relationship has gone sour and you anticipate litigation on the horizon?  It’s not too late. Conducting an investigation of your potential opponent could also assist you in determining your business’s future legal strategy in handling this potential liability.

Conduct a Public Records Search

Investigating a potential opponent in the public records is critical to determining how to most efficiently handle or even prevent a business dispute from going to litigation.  If your business knows all that it can about an opponent prior to the filing of a lawsuit, it can decide whether to litigate immediately to capture assets before they disappear, or whether litigation would be futile due to the opponent’s limited assets.

But where should you begin investigating your potential future opponent?  The best way to determine your starting point is to pinpoint what information would be the most relevant to you and your business at the onset of a litigation.  The following queries, although not exhaustive, are useful for determining the most pertinent information for your potential legal matter, prior to diving into public records.

Determine whether your opponent is judgment proof.

An opponent is “judgment proof” if he is actually or effectively financially insolvent, i.e., his income is less than his bills or liabilities.  Being judgment proof means it will be extremely difficult if not impossible to enforce a judgment against such a potential civil defendant.

If you can determine from public records that your opponent is judgment proof, you and your company have to seriously consider whether it is financially prudent to expend a significant amount of time, effort, and money to sue an opponent for a monetary judgment that most likely cannot be collected.

While some of your opponent’s most confidential information will be relatively inaccessible in a regular public search, public records databases can nevertheless provide substantial insight.  For example, a public records search can reveal whether your opponent has any bankruptcies, along with the date of these proceedings.  If your opponent is currently in chapter 13 bankruptcy, it may be very difficult to file a lawsuit against them, let alone enforce a judgment.

On the other hand, public records could reveal an opponent’s ownership of lien-worthy property.  For example, an opponent’s DMV records could reveal ownership of not only automobiles, but also recreational vehicles such as watercraft and all-terrain vehicles.  Also, real property public records data could uncover not only whether an opponent owns his or her primary residence (or whether it is encumbered by a mortgage/deed of trust or other liens), but also whether your opponent owns any additional real property.

But even if your opponent does not own any property easily discoverable through a public records search, such a search can still provide other clues on the opponent’s financial circumstances.  For example, an opponent without any publicly-registered assets may be listed as the owner of a business, and that business itself may hold a number of assets.  Whether or not the business has any publicly-traceable assets, the opponent’s affiliation with the business in itself may suggest the opponent has financial resources sufficient to pay a potential judgment.

While it is possible to conceal some assets from public record, if your opponent’s public records history does not reveal any information, he or she may simply lack any sizeable assets onto which a lien may be attached.  These results should give you and your company pause before pursuing a civil action seeking monetary damages, as it would not be worth the time and money.

Determine whether your opponent is has prior criminal convictions.

While this is an obvious category for inquiry on criminal matters, the benefits of performing the same type of research for a civil case should not be discounted.  As in criminal matters, one of the most important benefits to researching this category of public data in civil cases is the ability to use such criminal records for purposes of impeaching your opponent’s credibility as a witness.

Not only can general use conviction records involving felonies and crimes be used to establish your opponent’s “moral turpitude,” many criminal history records can also be used to reveal and expose your opponent’s factual narrative and motive, if the conviction ultimately has a connection to the facts of the case.

For example, an investigation may reveal a theft conviction in the criminal history of a former employee, and your company is contemplating bringing a misappropriation of trade secrets case against him.  This conviction is likely very relevant to the facts of such a case.  Even if the information you uncover is not as directly related to the facts of the potential case, conducting this research will at a minimum put you and your business in a better bargaining and pre-litigation position.  Thus an opponent’s criminal history should almost always be investigated on the eve of litigation.

Determine your opponent’s litigation history.

Public records can reveal not only criminal backgrounds as discussed above, but also civil lawsuits and judgments.  Business and other organizational affiliations may provide further insight into the facts and other potentially-relevant parties.

Another obvious source of information in a public records search is web and social media content relating to the opponent.  Social media platforms like Facebook and Twitter offer a lot of personal information not found elsewhere.  Many individuals chronicle, in great detail, the events of their lives with text data, photos and video.  Also, geographic tracking features integrated into many social media make it easy to track the location your opponent, which is helpful if you are trying to serve them with a summons and complaint.

Beyond social media, the Internet offers additional personal information in the form of blog posts and news stories.  The advantage these sources have over social media is that they may be less filtered and thus more reliable, since your opponent may not have originally published the information pertaining to him or her or it on the blog or news story.

Because of the huge amount of data available through public records, inquiries into a potential opponent’s background should not be limited to only the sources and purposes discussed above.  If you and your business foresee a potential litigation and are interested in conducting an extensive public records search of your potential opponent, contact Edwards Law today to put together a complimentary public search analysis.  Conducting this search will enable you and your business to determine whether a lawsuit would be financially worthwhile.