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Fiduciary duty claims between closely-held business owners are commonplace in litigation before the Commercial Division. A decision last fall from Suffolk County Commercial Division Justice James C. Hudson in Matter of Lehan...more
On Jan. 15, 2026, the U.S. Court of Appeals for the Sixth Circuit issued a published opinion in Boyd v. Northern Biomedical Research, Inc., clarifying the fiduciary duties directors owe to minority shareholders in a closely...more
Doing the same thing generally produces the same result, and as the new year arrives, many business owners are considering new steps to help their companies achieve greater success in the year ahead....more
Bad behavior in the workplace is in many instances a legal wrong that leads to legal consequences. Sexual harassment, for example, leads to consequences under tort and employment law. But if the perpetrator is a director or...more
In a recent decision, the Court of Chancery of the State of Delaware addressed a dispute at a private Delaware corporation concerning the removal of two officers by the board under a notice of board meeting that the court...more
There is a common misconception that ownership equals control. But in many businesses—especially those participating in the Small Business Administration’s (SBA) 8(a), Women-Owned Small Business (WOSB), or Service-Disabled...more
In Norman v. Strateman, No. A170356, 2025 WL 1802786 (Cal. App., 1st Dist., June 20, 2025), the California Court of Appeal held that a settlement of derivative claims reached among all shareholders of a close corporation was...more
In a case of first impression, the Land Court decided that shareholders of Massachusetts close corporations may acquire corporate real estate by adverse possession. In Szawlowski v. Szawlowski Realty, Inc., the Court...more
Situations involving family dynamics, significant wealth, and fiduciary duties can be ripe for conflict. Disputes frequently arise among owners and managers of closely held businesses, family office constituencies, and other...more
Imagine for a moment that you’re a shareholder in a closely held corporation. In most jurisdictions, that status as a shareholder obligates you to a heightened fiduciary duty to your fellow shareholders. Now imagine that your...more
When a closely-held business is profitable, self-interested owners naturally want a bigger slice of the pie, especially where the personal relationships among the owners are frayed. Perhaps that’s why we often discuss the...more
Occasionally, we come across court cases in which the majority owners so egregiously mistreated their minority co-owners that it’s difficult not to write about it — if only as a lesson in what not to do to separate oneself as...more
Do New York’s Surrogate’s Courts have jurisdiction to compel an accounting related to a non-party limited liability company in which the decedent’s estate has only a minority interest? ...more
In the menagerie of closely held companies, those owned and controlled by 50/50 business partners pose unique benefits and challenges. On the benefit side, co-equal ownership and control can foster cooperation,...more
In Washington State, closely held companies are those in which the ownership is concentrated among a small number of shareholders. These companies may also be family-owned or held by a group of individuals who have a...more
There are many ways that an owner of a closely-held business can use their superior financial resources to gain an advantage over their co-owners in a dispute. One common way is the use of a capital call provision to dilute...more
You represent a minority shareholder of a closely-held corporation and the company is having an off year. The majority shareholder is the sole member of the board and serves in every officer position. She draws significant...more
There is arguably no more prevalent legal claim in business divorces than a claim of breach of a fiduciary duty. Simply put (and I do mean simply), when one person owes a fiduciary duty to another, the person with the duty...more
For some owners of closely held companies, installing a board of directors may seem more painful than cutting off one of their pinkie fingers. They’d have to give up control of their business. They’d have to share...more
Judge Ricciuti, sitting in the Massachusetts Business Litigation Session, rejected a shareholder’s claim that she could shed herself of the fiduciary duty she owed to a close corporation by renouncing her shares in the...more
When it comes to protecting their interests – or the interests of the corporation – shareholders have unique rights to take legal action. They can file suit either on behalf of the corporation itself, known as a derivative...more
Settlors often place some or all of the ownership in a closely-held business in a trust. A trustee managing a trust with an interest in a closely held business has difficult management issues to address and this often raises...more
David F. Johnson presented “Advising Trustees Who Manage Closely-Held Business Interest” to the WealthCounsel webinar on June 30, 2022. Settlors often place some or all of the ownership in a closely-held business in a trust....more
The seven-year anniversary of the Texas Supreme Court’s decision in Ritchie v. Rupee has come and gone, and the court’s holding from 2014 remains the law: Minority shareholders in Texas private companies do not have a cause...more
It is an old saw that partners, co-venturers, and insiders to closely held businesses owe fiduciary duties of loyalty and due care when dealing with one another. Importantly, these fiduciary duties modify the common law of...more