In closely-held businesses in New Jersey with multiple owners, it seems fairly obvious that the more co-owners you can recruit to your side in a business divorce litigation, the better. You don’t need a lawyer to tell you that. However, what is not so obvious is the possibility of recruiting co-owners to your side once the litigation has commenced.
Litigation – especially business divorce litigation – can be quite divisive. » Read More
When minority shareholders in New Jersey (including LLC members) are being treated unfairly or oppressively, the New Jersey minority shareholder oppression statute provides significant rights that are written about quite frequently on this site. The upside of a successful oppression suit is often a buyout at market value. However, what if the minority shareholder loses the case?
The consequences of losing a shareholder oppression suit can be enormous, as most shareholders get only one true “bite at the apple.” In other words, if you already felt you were being treated unfairly, but the court did not grant you the relief that you wanted and left you as a minority shareholder, how likely would you be to ever file a second shareholder oppression lawsuit? » Read More
Business owners who are having a dispute with their business partners (in New Jersey) should not read this blog and assume their only remedy is shareholder dispute litigation. Because of the cost – both in legal fees, and to your business – litigation should almost always be a last resort. But being prepared to file litigation often leads to other positive, productive results.» Read More
In the last year or so, I have seen several business owners who are not very happy that New Jersey LLC members now have the same protection from minority oppression that is enjoyed by minority shareholders of corporations. To “protect” against such lawsuits, apparently several attorneys around the state are advising clients to add to Operating Agreements a clause that waives this protection.» Read More
An injunction is when a court orders someone to do something, or not to do something. These can be very difficult to obtain – in some circumstances – and are often not granted when money damages at the end of a lawsuit can make the aggrieved party whole. In shareholder dispute litigation, injunctions are often a critical tool. A court can order the majority shareholder not to take certain actions that would be hard to unwind at the end of the case. » Read More
David C. Roberts and Norris McLaughlin & Marcus, P.A., cordially invite you to a complimentary breakfast seminar that will explain your rights as a shareholder. You may feel your business partner is defrauding you by taking too much money and using the company as a personal piggy bank. Or, you may simply feel kept in the dark, marginalized, and left out in the cold. » Read More
Many times, two 50% owners possess different areas of expertise and separate spheres of influence. For example, it is not uncommon for one business partner to be in charge of sales, with the other in charge of finances. Because of this, one person often has more contacts than the other. Presumably, but not necessarily, the shareholder in charge of sales will have more customer contacts than the one who runs the front office.» Read More
In my last posting, I started discussing the difficulty involved in simply “getting before the judge” so that he can “hear my story,” and the fact that it’s usually not that easy in a shareholder dispute litigation. This time, I want to elaborate on such requests, including real life examples in shareholder disputes of when a judge is likely to intervene early, and when she is not.» Read More
A minority shareholder will most often seek a buyout as a judicial remedy. However, in some instances, the minority shareholder may want to be the purchaser instead of the seller. Although this is never easy, it is possible, depending upon the particular facts.
If you have a chance of being the purchaser of the majority’s interest, by definition you have been successful in demonstrating that the majority shareholders engaged in wrongful conduct. » Read More
You have decided that the problems you are having with your business partner are so bad that you have to file litigation against him. As discussed in prior postings, the remedy in such a case is often a buy-out. Either the court will order that you will buy out your business partner, or that he will buy you out. » Read More