When you are talking about legal terms, there are always the ones that you hear often, but maybe don’t have the most precise idea of what it means.

We understand that. We work in law, and the terms can be confusing. So to shed some light, we are here to talk about Due Diligence. You may have even said this before, and within context, you can understand what is being said. If someone were to tell you “We were satisfied that he had done his due diligence with the procedure.” you can figure out in the context what they mean. Thelawdictionary.com defines due diligence as “Such a measure of prudence, activity, or assiduity, as is properly to be expected from, and ordinarily exercised by, a reasonable and prudent man under the particular circumstances; not measured by any absolute standard, but depending on the relative facts of the special case.”

Many times, due diligence is talked about in mergers and acquisitions cases.

This is when one company is buying another company or a specific aspect of another company, and they are following through a long and detailed process to make sure that this merger or acquisition will not cause any further legal problems down the road. This process can include looking at financial information, debts of the business, operational aspects of the market, lawsuits against the company, intellectual property rights, compensation agreements, customer agreements, employment contracts, distribution understandings and much more. This due diligence is necessary for the buyer and owner to come to the best deal for each of them.

If you have questions about legal matters, we would love to talk to you. We are always here to help you if you should ever need legal help. All of our initial meetings are free of obligation and cost.