OT - Customer Threatening to Sue, Advice?
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  1. #1
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    Default OT - Customer Threatening to Sue, Advice?

    I'll try to keep this vague, I made a product for a new customer. They are located several states over, so it had to ship, and it was a decent sized order so had to ship freight. They made it clear that they were pretty rushed for this order, and my experience with freight is they're always a couple days late. The estimated delivery date was the day before they needed this by, I still cautioned the customer that they can be a couple days late and if it was crucial the shipment arrived on time, to upgrade the shipping to a Guaranteed Delivery, they took their chances and didn't. Well the shipment for some reason was transported by rail, not truck, and was not only a couple days late, it would have been 10 days late if the customer had not intervened and sent a "rescue" truck in to intercept the package and drive straight there ($$$). They requested a refund on the shipping expenses since it was so delayed. Now the value of the shipment was not that much, it was just large, and refunding the shipping charges would put this order at a loss. I politely tried to reason with the customer saying granted the shipment was more delayed than I anticipated, I personally still shipped the product out when I specified I would, you did not want to pay for guaranteed delivery date, and I am not to blame for the trucking company being so delayed. The freight company makes no guarantees at all on their delivery dates, so they are not willing to do anything about this (not even a partial refund since the shipment didn't go the whole way!). Well now the customer is saying they will "take legal action" to get the shipping charges back if I do not willingly give them a refund. Now the worst part about all this is the customer is a law firm.

    It seems ridiculous they would actually proceed with legal action over a few hundred in shipping charges, that's small claims court worthy, but I don't' think you can do small claims over different states? Which I feel like makes this even more complicated for them. Is this one of those things where I should just give them what they want to avoid the headache? At the same time I'm a little stubborn, and I feel like I held up to my end of the bargain so why would I refund them? Or am I looking at this from the wrong perspective, and I am in the wrong and I should refund them?

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    Ask someone with a law degree?

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    What have you got in writing, emails or telephone recordings? If you can prove you advised em of the risks and they accepted that, its not exactly on you, if all you have is a she said he said, IMHO it might be better to pick a wiser fight!

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    They're just trying to scare you into paying for shipping. Tell them to suck it.

    How much time is this law firm going to spend sueing you for $300 bucks when they could be doing real work and billing clients for $$$ an hour. Give me a break. Fuckin scum bags. I absolutely would not fucking pay.

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    maybe ask to accept half the shipping charges and each go their own way. Mention you understand their frustration and hope they can understand your loss as well.

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    Quote Originally Posted by Econdron View Post
    Now the worst part about all this is the customer is a law firm.

    It seems ridiculous they would actually proceed with legal action over a few hundred in shipping charges,
    If they do take you to small claims court, do you have a string of e-mails or texts showing your concerns about the stuff not being shipped Guaranteed Delivery? If not then I would pay the few hundred, if you do go to court how much is it going to cost in time and lost productivity to defend yourself? Send the money as loose pennies.

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    Hope they paid in advance.
    If so, they need to suck it up buttercup.

    You can give them my number. I'll be happy to laugh at them over the phone.

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    Way to make friends with new clients right...so you are idiots(them not you)


    It is amazing how few companies people understand that emails don't really go away. So if you have emails verifying then you are golden. Good luck

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    What kind of decent size order has less than $300.00 profit?

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    Like they say, What do you have with a dozen lawyers buried up to their necks in sand? Not enough sand...
    I agree with EndlessWaltz #8, hope you have emails to document your position. Good luck with this, their time to sue you is free, so it could wind up being a pain.

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    I'm having a hard time imagining what product a law firm would even need? Paper clips?

    As noted, $300 makes a difference on a large order?

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    I guess this event is why people have been telling me for many decades “never do business with doctors or lawyers”

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    Quote Originally Posted by Porschefix View Post
    ...What do you have with a dozen lawyers buried up to their necks in sand?
    A great place to take a leak.

    Mike

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    Never never ever work for lawyers, They as a whole are scumbags. I was at a friends business, an independent aircraft service company. We were in the hangar. some guy walks in and starts asking about An annual on his Aztec and having a few odds and ends repaired. My friend says yea I can do it, bring it over next week, The guy hands him a business card, he looks at it, hands it back and says not to bring the plane in because he does not work for lawyers. The guy got pretty bumpy and stomped out. Within a week he sued my friend! So probably don't tell them you don't work for lawyers just don't take the job.

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    Quote Originally Posted by SIP6A View Post
    What kind of decent size order has less than $300.00 profit?
    ....and what kind of job get's shipped via. rail (other than coal)?

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    Quote Originally Posted by Porschefix View Post
    Like they say, What do you have with a dozen lawyers buried up to their necks in sand? Not enough sand...

    I always heard it with the answer being: A good start....

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    It is probably an empty threat if the amount involved is less than $1000. Nevertheless, if it is a law firm, a suit is possible. There is no need to worry about this because you have the legal advantage here.

    Your best move currently is to cut off communication with them. Never provide information to the enemy. Just hang up if they call.

    --------------------------------------------------

    If they sue you, what will happen is you will get a carbon copy from the court in question with the claims against you. Since the amount is small it will be a "small claims case". Your company will be ordered to appear on a certain date and time to answer the claim.

    If this happens, your first move should be to contest the venue. For a court to judge you, it must have jurisdiction over you, which it probably will not. This kind of jurisdiction is called "personal jurisdiction". Find out the judge who is hearing the case. It should be on the summons. If it is not, then call the clerk of the court and ask who the judge is. Address a letter to the judge. The letter should be sent certified mail and read something like this:

    [Date]

    Re: Small Claims Case #123456, Superior Court of Whatever, Podunk, IA

    To: the Honorable Joe G. Schmoe presiding

    May it please the court in the matter of small claims case #123456, Vicious, Trifling & Petty LLC versus Chips Turnsalot & Sons, the defendant respectively petitions that the case be dismissed without prejudice on the grounds that the venue is improper and the court holds no personal jurisdiction over the defendant, Chips Turnsalot & Sons of Farawaysville, AK, in this case.

    Your honor, our firm, Chips Turnsalot & Sons, is located in Farawaysville, Alaska, which is over 1000 miles from the borders of Iowa. Our firm has no business presence in Iowa and does not do business in Iowa nor do we advertise or solicit business in Iowa. According to the laws of Iowa, we argue that the Superior Court of Whatever, Podunk, IA, lacks personal jurisdiction over our business in this case and should dismiss this claim.

    Respectfully yours,

    Chips Turnsalot
    Chips Turnsalot & Sons
    1018 Carbide Way
    Farawaysville, Alaska

    After you send this letter, there is 90% chance that you will get a letter from court dismissing the case without prejudice. The pricks who sued can file in your local court if they want to, but this is highly unlikely. Therefore you will win.

    In the (highly unlikely) case that the court insists on hearing the case, you have further options, but since this scenario is so unlikely I do not want to provide guidance on this situation unless it actually happens.

    --------------------------------------------------

    By the way, if someone demands money from you and threatens to sue you but fails to follow through on that threat in one year, then it is legally considered extortion and you can both file a criminal and civil complaint against them. If a year elapses with no action from the prick lawyers who threatened you, one option you have is to write the District Attorney in their locale and make a complaint of extortion, providing the DA with the facts. The advantage of doing this is that it immunizes you against any further suits from them, since any suit they make after that point will be considered "retaliatory" and therefore dismissable.

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    I guess I'll be the only one to disagree with the majority of the sentiment above...

    My business does a lot of customer service for products that we manufacture, take it from me: pay them and move on with your life. Never do business with them again and protect yourself from this kind of thing in the future by adding terms to your order confirmations. Fighting with a bunch of lawyers is more stress than it's worth.

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    Well a lawyer is a good idea except that a hour will cost you $300 with a good one not ot mention the paper hours.
    Fighting it yourself in a good idea expect how many hours do you lose this way and customer is maybe not so happy.

    Sometimes you eat the loss, apologize all day long while explaining that you did what you could and make the customer think you are a stand up guy.
    If this customer will repeat or knows other potential customers you can play this to your advantage in the long term as you basically buy a chip to store away for a later time or circumstance.
    I would cry as if I was mortally wounded and pay up. Otherwise you could very well win in the legal area but the whole deal be a lose/lose.
    At times you take a loss when not your fault to establish and hold your reputation.

    If the customer comes after the normal $10,000+ per day, yes line up the legal team and pray as you did things right. Now we are talking serious money but I have never seen anyone win against these size firms.

    When you die they don't count your money but they do count your effort and honor.
    I don't see that this bankrupts you, maybe I don't get the big picture.
    (OTOH, SWMBO hates this type of business thinking, many arguments there....)
    Bob

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    This could go either way. I have fought lawyers without legal help of my own and won. It feels good. I counted on it not going beyond a few letters for a sum of a few hundred dollars and it didn't. The lawyer involved probably had his secretary compose and prepare the letters and he just signed them. Probably less than a minute of his time per letter and there were around four of five of them. It really isn't worth their time to go to court for a few hundred dollars and he knew it as well as I did. Besides, I had followed the letter of the lease perfectly. It spelled out exactly how to break it and I did every step. The lawyer finally gave up.

    If you offer a 50/50% settlement or some other reasonable figure, they will probably take it. Hopefully that will still leave you in the black on the job.

    If they don't, I like jscpm's suggested letter to the judge. If the court is out of your state, I suspect that will work. I really doubt that an out of state court has a way to force you to appear in their courtroom. This isn't exactly a murder case.



    Quote Originally Posted by powerglider View Post
    maybe ask to accept half the shipping charges and each go their own way. Mention you understand their frustration and hope they can understand your loss as well.


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