Disagreements among shareholders are often focused on issues of control of a corporation.
Disputes Involving Rights of First Refusal
A disagreement may arise when one shareholder wants to sell out and another claims “rights of first refusal” based on a shareholders’ agreement. Perhaps another shareholder in your corporation has already retained a lawyer who is analyzing your shareholders’ agreement searching for ambiguities and loopholes that may create favorable conditions for the action that he or she wants to take in opposition to your interests.
Nonpayment of Dividends
You may be considering suing your corporation for wrongs committed by the corporation against you. For example, you as minority owner in a highly profitable closely held business may have been denied proper dividend payments. Did the majority shareholders siphon off profits in excessive salaries for themselves, apparently in order to avoid paying dividends to all shareholders? You may be considering the advisability of suing the corporation for the amount of dividends that you should have been paid, and/or suing the controlling owner who took the profits.
You may be planning what is known as a derivative action, suing one or more shareholders or third parties on behalf of the corporation itself. The third parties might be suppliers, customers, directors or officers. Any legal claim that the corporation has against an individual or entity may be material for a derivative action. If you are successful, the corporation will pay your legal fees.
Contact John McDuff
The quality of my work as a lawyer is well recognized by my clients & I have received the AV rating* under Martindale-Hubbell’s peer review rating system. My clients are predominantly from Austin and Central Texas, and occasionally from other states. Contact the Austin law offices of John McDuff to schedule an appointment regarding shareholder litigation. Learn your rights and discuss your options, regardless of whether you will be in the role of plaintiff or defendant. Call 512.457.1177.
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