Modern-day corporations have to battle competitors to get ahead. They have to contend with price wars and, occasionally, the rapidly rising cost of materials and fickle consumers who can leave them with inventory stacked in warehouses. It's tough. And here's another headache: legal fees.
For instance, according to Michelle Leder at Footnoted.org, UnitedHealth Group
Legal fees can be somewhat more consequential for other companies, though. For example, Qualcomm
Even those more extensive legal fees didn't look like they'd sink Qualcomm, but they were certainly pressuring the company. Of perhaps greatest interest to Qualcomm investors is an agreement with Broadcom that they won't sue each other in the future. That erases much uncertainty surrounding the company, and it means Qualcomm can focus more on growing its business and less on defending it.
A more stark effect can be seen at RealNetworks
What to do
So, as you look for investment candidates, keep an eye out for legal fees. Be ready to see patent fights, antitrust claims, class action suits, and a host of other issues being litigated in a costly manner. Then make your decision accordingly, with your eyes open.
More about companies and their legal troubles:
Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article. UnitedHealth Group is a Motley Fool Stock Advisor recommendation. Nokia and UnitedHealth Group are Motley Fool Inside Value selections. The Fool owns shares of UnitedHealth Group. Try our investing newsletters free for 30 days. The Motley Fool is Fools writing for Fools.