Ideally, a practice sale or acquisition is smooth, easy, and without lingering issues. Unfortunately, that is rarely the case. It’s not unreasonable to think, anything that can go wrong, will go wrong (at some point). The best way to protect against these lingering issues is to ensure, as a seller, you’re as open and honest as possible, while as a buyer, you’re as thorough as possible and you have a purchase agreement that protects against these lingering or uncovered issues. Some examples include:
- A post-closing trademark dispute over the name of the practice which was not disclosed;
- Equipment that isn’t working (maybe it was propped up for a walk through, but then broke down);
- Employees getting raises right before closing;
- Solicitation or competition after closing;
- Finding discrepancies in billing practices;
- Employee disputes
Do your due diligence, like your life depends on it when you’re a buyer. And when you’re selling, it’s better to lay it all out then risk a lawsuit or claw-back after Closing.
