{"ok":true,"canonical_url":"https://dealroom.so/glossary/pending-litigation","api_url":"https://dealroom.so/api/public/glossary/pending-litigation","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"pending-litigation","term":"Pending Litigation","group":"People and paperwork","definition":"Lawsuits against the business or seller can create significant financial liabilities or distract from operations. Buyers need to identify any pending cases to assess risks and potential costs before closing.","what_it_means":"During due diligence, you must uncover any lawsuits or legal disputes the business or its principals are involved in. Your lender will also scrutinize this, as it impacts the business's financial health and ability to repay the loan. Ensure any material litigation is resolved or accounted for in the deal terms.","url":"https://dealroom.so/glossary/pending-litigation","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"due-diligence","term":"Due diligence","url":"https://dealroom.so/glossary/due-diligence"},{"slug":"liability","term":"Liability","url":"https://dealroom.so/glossary/liability"},{"slug":"material-information","term":"Material information","url":"https://dealroom.so/glossary/material-information"},{"slug":"intentional-misrepresentation","term":"Intentional misrepresentation","url":"https://dealroom.so/glossary/intentional-misrepresentation"}],"related_questions":[{"question":"What if the business I'm buying has existing legal disputes or pending litigation?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-m-buying-has-existing-legal-disputes-or-pending-litigation"},{"question":"What if the business I want to buy has pending litigation or unresolved legal claims?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-want-to-buy-has-pending-litigation-or-unresolved-legal-claims"},{"question":"What if the business I'm acquiring has existing litigation or legal disputes?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-m-acquiring-has-existing-litigation-or-legal-disputes"},{"question":"How do past civil litigation or judgments impact my SBA 7(a) loan approval?","url":"https://dealroom.so/sba-7a/questions/how-do-past-civil-litigation-or-judgments-impact-my-sba-7-a-loan-approval"},{"question":"What if the business I'm buying has existing legal disputes or pending lawsuits?","url":"https://dealroom.so/sba-loans/basics/what-if-the-business-i-m-buying-has-existing-legal-disputes-or-pending-lawsuits"},{"question":"Does a pending civil lawsuit against me personally affect SBA 7(a) loan approval?","url":"https://dealroom.so/sba-7a/questions/does-a-pending-civil-lawsuit-against-me-personally-affect-sba-7-a-loan-approval"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Pending Litigation","url":"https://dealroom.so/glossary/pending-litigation","source_type":"DealRoom Data"}}