In my last post, I addressed the fact that, just because a minority shareholder has gone along with certain practices in the past, his acquiescence will not necessarily be fatal to a shareholder oppression claim. However, that does not mean you should simply go along with something that you fundamentally disagree with, and assume it will have no consequences to you in the future.» Read More
A common theme among minority shareholders seeking legal representation is termination of employment. Readers of this blog may be aware that termination can often constitute minority shareholder oppression, warranting a remedy such as a court-ordered buyout. But, unfortunately, not all terminations are equal, as not all terminations constitute oppression.
The key to whether termination of employment amounts to minority shareholder oppression is what the court calls the “reasonable expectations” of the employee/shareholder. » Read More
Many times, minority shareholders pursuing their shareholder oppression rights, as well as majority shareholders being sued for minority shareholder oppression, feel the important thing to look for in an attorney is experience dealing with the particular industry that the company occupies. For example, the President of a chemical company retained counsel to represent the company on all corporate matters due to his long history representing chemical companies, since he clearly understood issues relating to that field, particularly the environmental regulations that company routinely encountered. » 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
In New Jersey Shareholder Dispute Litigation, Your Concern Must be Your Own Interests, Not the Interests of Other Minority Shareholders, or Even Family Members
When a new client comes in complaining that he is being treated unfairly by his business partners and hears that he may have the right to be paid for his shares, that potential remedy is often appealing.» Read More
I have written extensively about the difference between the law in New Jersey protecting a minority shareholder in a corporation, and the law protecting a minority member in a limited liability company (LLC). Most lawyers practicing extensively in this area of law have long argued, and believed, that the statute protecting minority shareholders in a corporation from what is considered “shareholder oppression” does not apply to LLC’s (much as we may want it to). » Read More