News & Analysis as of

Minority Shareholders

Winter Case Notes: LLC Deadlock and Other Recent Decisions of Interest

by Farrell Fritz, P.C. on

This winter forever will be remembered in the Northeast as the winter of the “bomb cyclone,” which gets credit for the 6º temperature and bone-chilling winds howling outside as I write this. So in its honor, I’m accelerating...more

Court Of Chancery Denies Receivership Petition For Failure To Prove Insolvency

by Morris James LLP on

In re: Geneius Biotechnology Inc., C.A. 2017-0297-TMR (December 8, 2017) - This decision explains what is needed to prove a corporation is insolvent so that a receiver should be appointed for it....more

Minority Owner Or No Owner At All?

by Farrell Fritz, P.C. on

Old Dog, New Tricks? It’s a concern for every new investor in a closely held business: will the founding owners continue to operate the business as they always have, or will they recognize that they now have new co-owners...more

Court of Chancery Confirms MFW Applies to Controlled-Company Sale With Disparate Consideration

In 2014, the Delaware Supreme Court affirmed in Kahn v. M&F Worldwide Corp., 88 A.3d 635 (MFW II), that the business judgment rule would apply to controlling stockholder “squeeze-out” mergers if the transaction is conditioned...more

Be Careful What You Ask For in a Section 225 Case

by Morris James LLP on

Delaware recognizes the need to promptly resolve disputes over the composition of the board of directors of a Delaware corporation. Section 225 of the Delaware General Corporation Law provides that the Delaware Court of...more

The (Even More) Elusive Surcharge in Dissolution Proceedings

by Farrell Fritz, P.C. on

A year ago I wrote a piece called The Elusive Surcharge in Dissolution Proceedings highlighting the rare appearance in the case law of the surcharge provision found in Section 1104-a (d) of the Business Corporation Law. ...more

Japan Legal Update - Volume 30 | October 2017

by Jones Day on

Labor & Employment - Outline of Japanese Legislation for the Promotion of Work Style Reform Held Reasonable - On September 8, 2017, Japan's Labour Policy Council announced its opinion that the "Outline of Legislation...more

Watch Out For Minority Shareholder Oppression Claims After Admitting Non-Family Shareholders To The Family-Owned Business

by Murtha Cullina on

Controlling shareholders and managers of family-owned businesses often direct the use of company funds and other resources to provide employment and other benefits to non-shareholder family members. In a business that is...more

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....more

Germany Sides with Institutional Investors in Competition Debate

by Blank Rome LLP on

Action Item: The German Government recently weighed in on the side of institutional investors on a competition issue that has generated vigorous academic debate in the United States: whether institutional investors’ minority...more

Overcome Your Nagging Doubts About Business Divorce Litigation

You likely came across this article if you Googled the term “shareholder dispute.” However, it is just as likely that you Googled the term “business divorce.” One business owner suing the other(s) to be bought out, or some...more

Shareholder Activism Dealt a Blow in Australia's Federal Court

by Jones Day on

The Background: In RBC Investor Services Australia Nominees Pty Limited v Brickworks Limited [2017] FCA 756 (10 July 2017) ("Brickworks case"), a large institutional investor sought to dismantle a cross shareholding...more

Blog: Martha Stewart Decision Draws Roadmap for Controller Sales to Third Parties

by Cooley LLP on

A transaction involving a controlling stockholder on both sides of the deal presents a clear conflict of interest that will result in heightened scrutiny under the “entire fairness” standard of review if later challenged....more

And the Award For Most Oppressive Conduct By a Majority Shareholder Goes to . . .

by Farrell Fritz, P.C. on

Over the years I’ve litigated and observed countless cases of alleged oppression of minority shareholders by the majority. Oppression can take endlessly different forms, some more crude than others in their execution, some...more

Court Holds That Majority Shareholders In Closely Held Corporation Do Not Owe Fiduciary Duties To Minority Shareholders

by Winstead PC on

In Herring Bancorp, Inc. v. Mikkelsen, a corporation acquired a majority of the outstanding shares of preferred stock by “repurchasing” those shares in accordance with the articles of incorporation, including the shares owned...more

Do You Have a Reasonable Expectation of Receiving Dividends if You Acquired Your Shares in a Family-Owned Corporation Through Gift...

by Murtha Cullina on

Corporate shareholders often expect to receive dividends in connection with their ownership of corporate shares. This is particularly true when owners invest capital in or provide other services to the company in exchange for...more

Minority Shareholders’ Derivative Suit Foiled by Voiding of Corporation’s Charter for Nonpayment of Taxes

by Farrell Fritz, P.C. on

A business’s failure to pay state taxes can be a problem if the entity later wants to bring a lawsuit, or its non-controlling owners want to sue on the entity’s behalf....more

It’s Never Too Late to Gain Allies in Business Divorce Litigation

In closely-held businesses in New Jersey with multiple owners, it seems fairly obvious that the more co-owners you can recruit to your side in a business divorce litigation, the better. You don’t need a lawyer to tell you...more

Changes to the Shareholders’ Rights Directive

by Allen & Overy LLP on

The Council of the EU adopted several changes to the Shareholders’ Rights Directive of 2007. The changes are relevant to listed companies in the EU. The changes are aimed at encouraging shareholder engagement, in...more

Then There Were Two: Court Rejects Minority Shareholder’s Claim of Wrongful Termination Under Founders Agreement

by Farrell Fritz, P.C. on

A company has four founding shareholders each of whom is a director-employee. Their agreement provides that the votes of three out of four founders are required to terminate the employment of any founder or to approve a...more

Forum Selection Clause Covers Extra-Contractual Claims

by Strasburger & Price, LLP on

Forum-selection clauses afford an opportunity to contractually preselect the jurisdiction for dispute resolution. While forum-selection clauses are enforceable, parties often disagree about their scope and whether they can be...more

Michigan Supreme Court Clarifies Statute of Limitations for Shareholder/Member Oppression Claims

by Miller Canfield on

When does the statute of limitations start running on claims for minority shareholder/member oppression under Michigan law? In its recent decision in Frank v. Linkner, a unanimous Michigan Supreme Court answered that...more

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...more

Minority Protections and Exit Options for Family Offices Considering Direct Private Investments

by Shearman & Sterling LLP on

As family offices trend toward direct private investments, it is important to consider minority protections and exit options in the context of investment negotiations. Direct private investments often mean greater control...more

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...more

141 Results
|
View per page
Page: of 6
Cybersecurity

"My best business intelligence,
in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.