For small business owners, when a customer threatens to sue, the threat needs to be evaluated before any actions are taken as a result of the threat. The majority of threats are not carried out, as the majority of people are too lazy to actually file a lawsuit after their initial anger passes. However, from time to time, a threat of litigation might actually be serious.
Fortunately for business owners, insurance can be purchased that covers nearly every kind of legal liability a business can face. If your business carries liability insurance, you should familiarize yourself with the terms of the policy, particularly as it relates to reporting potential legal claims. Even bogus threats might require reporting.