High-stakes disputes can be overwhelming, especially when the pressure's high and the stakes are even higher. Michael Gargiulo, CEO of VPN.com, has seen many business leaders and founders struggle to think clearly in such situations. He notes that one of the most common mistakes people make is treating dispute resolution as a purely legal problem.
However, Gargiulo argues that this approach isn't enough. He emphasizes that high-stakes disputes aren't just legal problems, but also business and reputational problems that require a more nuanced approach. Approaching a dispute with too much emotion can exacerbate the situation. Approaching a dispute with too many words or too little structure can also exacerbate the situation.
Strong communication in a dispute should usually be clean and intentional.
Gargiulo advises business leaders to focus on becoming precise. They should identify viable resolutions and understand the facts at hand. Many people believe that a strong position requires long explanations, but Gargiulo disagrees. In his experience, the more serious the dispute, the more valuable clarity becomes.
A minor disagreement can sometimes be handled informally, but high-stakes disputes are different. They often involve significant amounts of money. They also involve brand reputation, ownership, and operational risks. In such cases, discipline is crucial. The goal isn't to sound aggressive, but to become precise and focus on the facts.
Gargiulo stresses the importance of spelling out terms before agreeing to them. This includes payment timing, scope of work, approval rights, ownership rights, confidentiality, remedies, deadlines, termination rights, noncompete limits, jurisdiction, responsibility for failure, and what happens when one side doesn't perform.
Many people focus on the headline terms and ignore the rest, only to suffer the consequences later. A missing sentence can be just as dangerous as a bad one. Gargiulo also highlights the importance of seeking both legal and business advice. Relying solely on legal advice without considering the business implications can be costly.
A technically strong legal move may be bad for the company if it damages a key relationship. It may also trigger public fallout, burn capital, distract leadership, or create long-term strategic loss. On the other hand, a business-friendly compromise can be dangerous if it gives away leverage or weakens rights in ways that are hard to reverse.
Gargiulo advises business leaders to start by getting their facts organized. They should create a timeline and gather all relevant documents, communications, and agreements. Separating facts from opinions and what can be proven is crucial. Clean facts help gain leverage, while confusing or vague ones don't.
Some leaders treat settlements as a sign of surrender, but Gargiulo disagrees. A strong settlement can be a smart business decision, especially when litigation risk, distraction, and uncertainty start outweighing the value of winning.
The key is to settle from a position of thoughtfulness, not panic. This means understanding exposure, leverage, evidence, costs, and realistic alternatives. Knowing what must be protected and what can be traded is also essential.
In many cases, it's better to resolve issues promptly. You should draw a clear line in the sand and invite the opposing side to make their next move. Many serious disputes feel sudden, but they can often be preventable. Loose contracts can create openings that later turn into major problems. Unclear ownership can also create openings that later turn into major problems. Poor communication, rushed partnerships, and undefined expectations can create openings that later turn into major problems.
High-stakes dispute resolution begins before the dispute, with the drafting of contracts and agreements. It also begins with due diligence, documenting decisions, defining responsibilities, and thinking through downside scenarios before signing anything.
Gargiulo notes that any high-stakes dispute can test judgment, patience, and the ability to forgive. The best approach is almost always the clearest, not necessarily the loudest one. This translates into clearly defining terms and facts, obtaining credible legal counsel, and ensuring a plan is in place to protect rights and the future of the brand.
In a serious dispute, what's left unsaid can hurt just as much as what's said badly. Clarity isn't a small advantage; it's often the whole game.