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Shareholder Dispute Lawyers

No one likes being involved in a business dispute, but it’s even more stressful if the conflict involves shareholders (or partners, or members, depending on your business structure) arguing over the governance of the business or some important matter related to its operations or finances. That’s because all shareholders have a level of financial stake in the business.

Think of it like a family feud as opposed to an argument with just a friend; a family feud is much more personal, much more intense, and much more complicated, and the consequences can have impact for generations. Likewise, a shareholder dispute is a big deal that should be handled with care!

The highly experienced New York City shareholder dispute lawyers at Pitcoff Law Group actually practice these cases more than any other type. We can explain your rights and help you find a solution that leads to long-term success! Call today to schedule a complimentary consultation and learn more about how we can help.

New York City, NY Shareholder Dispute Lawyers

Common Shareholder Disputes & Causes

Shareholders rule by majority consensus, so it’s possible to be outvoted, but actual shareholder disputes mainly occur when someone feels that their rights have been infringed upon. Some of the most common examples of shareholder disputes our NYC shareholder dispute lawyers frequently handle include:

  • A breach of the shareholder agreement – A shareholder agreement is the contract that creates, specifies, and protects shareholder rights and obligations. (It also protects the company from unfair accusations). If shareholders are required to invest capital in the company and do not, transfer their shares to a third party without following the approval process, engage in business activity that competes with the company, or otherwise violates the terms of the agreement, this is considered a breach.

The best way to avoid a shareholder dispute over a breach in the first place is to have a clear and well-drafted shareholder agreement that doesn’t have any loopholes, but if you are already facing a dispute regarding the agreement, our New York City shareholder dispute lawyers can review the document to help you understand your options moving forward.

  • Fiduciary mismanagement – Every shareholder has an obligation to act in such a way to benefit the other shareholders and the company, and the company has the same obligation towards the shareholders. If someone acts out of a conflict of interest, withholds important financial information, discloses proprietary information to a third party, acts negligently in a way that puts the company at risk, or not managing operations prudently, this could lead to a lawsuit.
  • Minority shareholders disadvantaged – Minority shareholders are practically disadvantaged, because they have fewer shares than the majority shareholders so don’t have as much of a voice in making decisions. However, there are laws in place to protect minority shareholders from being completely frozen out. If they aren’t able to inspect corporate documents, aren’t issued proper dividends, or are otherwise mistreated, they can file lawsuits.
  • Disagreements over company direction – Making business decisions such as relocating the business, firing employees, making large purchases, and more can become contentious if not handled correctly, particularly in small or family-owned companies.
  • Compensation/contribution inequity – When shareholder employees are not paid equitably according to their experience and training, or if shareholders are not contributing monetarily or otherwise equitably, this can lead to legal conflict.
  • Concern over fraudulent activity – If shareholders or owners of the company are suspected of illegal activity or fraud, this can lead to legal action as well.

Dangers Of Mishandling A Shareholder Dispute

Depending on the circumstances, a shareholder dispute has the potential to completely derail a business’s trajectory if it isn’t resolved well. It’s important that you are able to put your own emotions aside and focus on the facts, as well as the big picture (which is the future stability of your company). Our New York City shareholder dispute lawyers will explore every aspect of the situation and do everything in our power to find a resolution that doesn’t dissolve the company or require you to spend thousands of dollars in legal fees. We’re not afraid to represent you in court, if necessary!

Why Choose Our New York City Shareholder Dispute Lawyers To Represent You?

Our NYC shareholder dispute lawyers have over 65 years of combined experience. We have dedicated our careers to serving New York’s small, medium-sized, and big business owners. Our goal is to make legal simple! Regardless of how complicated your shareholder dispute may seem, odds are we have handled many cases just like yours, and we can come up with a creative solution that sets your mind – and company – at ease. Over 100 clients have recommended us for our prompt communication, integrity, and results. Call today to schedule your complimentary consultation and learn more about how we can help!

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