As the economy improves, many businesses are finding that conflicts between shareholders and business partners that had been simmering beneath the surface for years are finally coming to a head. The previously laggard economy helped to mask those problems, since there was less of a reason to act on them while no one was making money. As a result of recent improvement in the overall economy, shareholder and partner disputes are becoming more common.

Consider that these business disputes almost always arise amongst business partners who once trusted one another. Whether they are family members, or simply people who once worked together to build a company, it highlights the fact that no one is immune from becoming involved in business disputes.

When disputes arise over a shareholder being terminated, a situation involving something as sinister as embezzlement, or simply results from an uncontrollable “power trip” by majority shareholders, there is a common theme to all such cases: Everyone attempts to re-write history.

Sometimes the “re-creations” are founded on a genuinely-held view of how things transpired. Other times, of course, people just plain lie. Regardless of motivation, if you are involved in a shareholder or partnership dispute it is never too early to start protecting yourself from revisionist history. Since things are easier to prove when in writing, start creating a paper trail once you sense a showdown on the horizon.

One of the first questions a business lawyer will ask is whether a Shareholders’ Agreement or an Operating Agreement exists. A Shareholders’ Agreement or Operating Agreement may contain buy-sell provisions or valuation provisions that may be relevant, or even dispositive, in a dispute. These agreements frequently determine the outcome in the event of death, disability, divorce, termination of employment, or the sale of an individuals interest in the business.

The business lawyers at Lustig & Wickert have had decades of experience resolving disputes between shareholders, business partners, LLC members and joint venturers. We are frequently called upon to provide advice and counsel to our clients and advocate on their behalf in negotiation, mediation, alternative dispute resolution and litigation in the following areas:

• Breach of fiduciary duty
• Embezzlement
• Shareholder disputes
• Shareholder oppression
• Self-dealing (pursuing business opportunities for one’s self that conflict with the best interests of the company)
• Minority ownership rights
• Executive compensation, buyout agreements and buyout rights
• Corporate deadlock disputes
• Shareholder appraisal

We also have extensive experience in shareholder litigation including seeking temporary restraining orders, preliminary injunctions, permanent injunctions, accounting’s, dissolution and shareholder derivative actions. We have been successful in having minority shareholders interests valued by the court and purchased by the other shareholders.

There are many ways to protect oneself in the event of shareholder disputes or business partner litigation. Because we practice in this area regularly we are familiar with the law and the strategies most commonly used. Call or email us today to schedule a free and confidential consultation to see if you can benefit from our extensive experience in shareholder disputes and partner disputes.