Minority shareholders of a closely held corporation may be subjected to oppressive conduct by the controlling majority that deprives them of the benefits of their investment. Oppressed minority shareholder actions vindicate the rights of the minority owner to participate in the management and share in the economic benefits of the…
The controlling shareholders of a corporation owe fiduciary duties to the minority shareholders by virtue of their ability to control the affairs of the company. Even when a merger complies with statutory requirements, where it benefits the controlling shareholders and does not have an apparent business purpose, it must also…
The Single Business Theory permits a court to treat related businesses as though they were one enterprise. Courts apply the single business theory in rare cases to prevent injustice. Pertuis v. Front Roe Rests., Inc., 2018 S.C. LEXIS 85 (2018) Statutes: S.C. Code Ann. § 33-18-420; S.C. Code Ann. §…
This seminal case by the New Jersey Supreme Court identifies minority oppression as the frustration of a shareholder’s reasonable expectations. A court may order the compelled purchase of a shareholder’s interest as a remedy for shareholder oppression when it is the only practical alternative to judicial dissolution. The minority shareholder…
It was the stuff of which a good minority oppression claim is easily cooked up. The party in control of the corporation had used the corporate bank accounts as his personal piggy bank while operating a competing business, paid himself inflated office rents and bankrolled an extra-marital affair with money…
An oppressed minority shareholder was awarded approximately $750,000 in attorneys fees and expert expenses — some eight times the amount of the buyout — even though the majority had good reason to fire him from his position as the corporation’s CEO. Fee Award Under Oppressed Shareholder Statute to Selling Shareholder…
Holding a family business together gets more difficult as time passes, as this recent opinion from the Appellate Division demonstrates. A rift between the family members still working for, and in control of H. Schultz & Sons, resulted in the minority members who stopped receiving dividends while the company was…