close

Blogs > Shareholder Disputes in New Jersey

majority shareholder

Feb 15, 2019

Kicking a Member Out of an LLC – Dissociation Under the New Jersey LLC Statute

Years ago, oppressed minority shareholders in New Jersey corporations had more protection than oppressed members of a New Jersey LLC. When the statute was revised in 2014, that changed, and LLC members now have similar remedies available to them. But there is one little-known section of the New Jersey LLC statute that makes it a more powerful tool for the majority owners than the corporate statute – the ability to “dissociate” a member. » Read More

Dec 07, 2018

Why Should the Majority Owners Have More Valuation Documents Than I Do?

Since litigation is so expensive, when a shareholder dispute arises, talks about the minority shareholder being bought out often happen before attorneys even become involved.  Often a client will come in with an offer in hand, or even a fully negotiated deal, asking for me to “write it up.”  But what happens if you only have a handful of the documents necessary to value the company?  » Read More

Oct 04, 2018

Prosecutors Are Rarely Interested in Business “Theft” Cases

Many business divorce cases start because one partner is improperly taking money from the business.  Such behavior can come in many different forms, including a majority shareholder wildly overcompensating himself, running personal expenses through the business, or having family members on the payroll with a no-show job.  » Read More

Oct 16, 2017

Misunderstandings Among Owners Can Lead to Business Divorce Litigation

One of the most common reasons for a minority shareholder to file “business divorce litigation” is because that minority owner feels left out, pushed out, squeezed out – simply not part of the process in any significant way.  Quite often, the minority owner is pushed out for a reason that is not entirely unjustified.  » Read More

May 23, 2017

Minority Shareholder Oppression Damages in New Jersey: More Than Just a Buyout?

As I have said many times in this blog, when minority shareholder oppression occurs, the most likely remedy is a buyout.  In other words, courts in New Jersey have the power to compel the majority shareholder to pay “fair value” to an oppressed minority shareholder so the victim of wrongdoing is not forced to remain captive as a shareholder in a company that is treating him improperly.  » Read More

Apr 28, 2017

Trust But Verify Regarding Financial Information

Minority owners of closely-held corporations (in New Jersey) often put themselves in a position where they are cut off from access to the company’s books and records.  When that happens, several things can occur, and few of them are good.

For example, majority shareholders who have unfettered access to the company’s finances often abuse their power by granting themselves impermissible benefits that are not related to their employment by the company, and are not proportionately shared with the minority shareholders.  » Read More

Mar 28, 2017

What If I Was Doing The Same Thing I Now Want to Sue Over?

Many clients ask at the start of a business divorce lawsuit, “Is it fatal to a shareholder oppression claim if I was doing some of the same things that the majority owners are doing that I am now complaining about?”  As often happens when it comes to a nuanced legal analysis under New Jersey law, the answer is, “It depends.”

For example, suppose you are a one-third shareholder, and the other one-third shareholders collectively run and control the business operations, especially the finances.  » Read More

Feb 13, 2017

Termination of Employment as Minority Shareholder Oppression

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. » Read More

Jan 26, 2017

Many Discovery Tools Exist To Find Emails To Prove Shareholder Oppression

I have noted many times on this blog that emails often prove shareholder oppression cases.  It can be fairly easy for majority shareholders who are careful, and seek legal advise beforehand, to mask their true intent when attempting to “freeze out” a minority shareholder.  » Read More

Jan 17, 2014

Get out of That New Jersey LLC before the Law Changes?

In my last post, I wrote about the fact that your right to simply withdraw from a New Jersey LLC and be paid fair market value for your shares – provided the Operating Agreement does not prohibit this – is being eliminated on March 1, 2014.  » Read More