The Lawsuit That Shaped My Company

Article by:
Jim Bailey
EO Arizona

I was sitting at home watching television when a hard knock at the door startled me. I opened the door and saw a normal-looking guy wearing a normal-looking suit. He asked me if I was James Bailey, and when I confirmed, he handed me a stack of papers, informed me that I had been served and wished me good luck. Luck was exactly what I needed.

In its infancy, the commercial painting business I co-founded was under attack by a tenacious competitor. My growing company had only four employees at the time; they had more than 1,000. We had the expenses of a start-up, US$30,000 in savings and some credit cards; they had the deep pockets of a national organization raking in US$30 million in annual sales. It was a David and Goliath scenario, only in the business world and without the handful of rocks.

Thankfully, the suit was settled out of court in seven months. Though we were facing an up-hill battle, the lawsuit turned out to be the most defining and culturally important moment in our young company’s life. It helped me develop a winning company culture that continues to fuel my business. Here is how we turned a negative into a positive:

We Reached Out
During difficult times, people get a chance to see into the heart of a company. Everyone in our local industry knew about the suit and they could tell we were struggling. The second word got out about our troubles we banded together and became a team. Our customers, our suppliers and even some of our other competitors rallied around us. It reminded me how infectious the entrepreneurial spirit can be.

We Spread the 411
We kept key employees informed and up-to-date regarding this challenging situation. I found that the people I work with wanted to help in any way they could. They wanted to be part of the team. I didn’t need to shelter them. In fact, informing them lightened my load and helped them realize that they were a large part of our success. Now it wasn’t just me or the company that survived this attack; as one, we took on the giant and won.

We Kept Clients in the Loop
We let our suppliers know what was happening when they asked. Teaming up with suppliers was a huge boost to our company, and it helped us with pricing, payment terms and customer relationships. They remain a huge part of our success.
We Turned the Other Cheek
We always do our best to act with integrity. We never badmouth others, even when they play dirty. Doing so would only bring us down to their level. There is an old saying that goes: “Never fight with a pig. You just get dirty and the pig loves it.” I believe this philosophy has played an enormous role in helping us to attract top talent and deflect negativity.

It’s been some time since the lawsuit occurred, but the lessons remain. The culture created in that first year has engrained a real sense of unity and optimism in our company. What’s more, our sense of purpose has prevailed. We feel there is nothing we cannot achieve together. That's the magic of a close-knit business. That's the magic of team effort.

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