Shareholder and Partner Disputes and Florida LLC
When you form a business, you presume everyone will pull their weight and work towards common goals. Unfortunately, when disputes arise between shareholders, managing members, or partners it can cause lasting damage to the company and business relationships.
These disputes usually involve money and include failing to properly account for money or other assets, self-dealing, individual profit, conversion, and corporate theft.
Attorney for Shareholder and Partner Disputes and Florida LLC in Miami, FL
Abrams Justice Trial Attorneys knows how important your business is to you. Our attorneys understand the complexity of business dispute cases and have the experience to resolve it with your best interest in mind.
Call us today at (305) 709-0880 or submit your information in our online form and one of our attorneys will review your case for free. We proudly assist clients in the greater Miami-Dade area including Miami, Homestead, Hialeah, Pinecrest, Miami Gardens, Miami Beach, North Miami, Doral, Coral Gables, and Cutler Bay.
Overview of Shareholder and Partner Disputes and Florida LLC in Miami, FL
- Types of Disputes
- How can Disputes be Resolved?
- Shareholder and Partner Disputes and Florida LLC Resources in Miami, FL
Types of Disputes
Shareholder and partner disputes can stem from many different circumstances. Disputes can arise from a disagreement over company direction or from an alleged breach of duty to the company. Listed below are types of shareholder and partner disputes.
Breach of Fiduciary Duty: Fiduciary duty is the obligation one party has to act in the best interest of the corporation. If a party commits an act that neither furthers corporate interest or damages corporate interest, it can be considered a breach of fiduciary duty. If the fiduciary’s act causes damages to the company a suit can be brought against the fiduciary for the breach.
Shareholder Oppression: This occurs when majority stakeholders in a corporation make decisions that prejudice the interest of the minority shareholders. This usually happens in close corporations. Minority shareholders in a closed corporation have little to no power but they are still owed a fiduciary duty from the majority shareholders that they will not use their control to put the minority at a disadvantage.
Deadlock Disputes: This form of dispute has no clear resolution. Deadlock disputes can occur when a business has two partners who are split on an important decision, or when a unanimous vote is required but cannot be reached.
Derivative Suit: If a corporation has a legitimate legal claim but the board and directors refuse to do anything about it, a shareholder can file suit on behalf of the corporation. This is called a derivative suit and is often used to expose wrongdoing within an organization such as fraud or breach of fiduciary duty.
Direct Suit: A direct suit is brought by a shareholder against the corporation for damages incurred by that shareholder by acts of the organization. Direct suits and derivative suits are often confused with one another. Distinguishing between the two can be a complicated exercise and many times a court will have to decide which type of suit it is dealing with.
Self-dealing: This occurs when a fiduciary takes advantage of their position to advance their personal interest rather than the interest of the corporation. Doing so causes a conflict of interest and can result in major financial damage to the affected shareholders or members.
How can Disputes be Resolved?
The nature of shareholder, partner and LLC disputes are complex because of the relationships among the parties. Because of that, litigation can cause damage to not only the corporation but the customer or vendor relationships as well. Listed below are the different ways disputes can be resolved.
- Mediation: Parties involved in the dispute can use a third-party mediator to voice concerns, preferred outcomes, grievances and hopefully reach an agreement. The mediation process can be informal and less rigid than a court room setting. Agreements made in mediation are voluntary and non-binding.
- Arbitration: This is similar to mediation, but the main difference is that agreements made in arbitration are binding and final. The Arbitrator will decide how the proceedings are conducted and will make the final decision after listening to both parties.
- Litigation: This is the most complex way to resolve disputes between partners, shareholders and LLCs, but it is often necessary.
Abrams Justice Trial Attorneys is experienced in all methods of handling disputes an will strive to resolve it with the best interest of those involved.
Shareholder and Partner Disputes and Florida LLC Resources in Miami, FL
Shareholders’ Preemptive Rights– Follow this link to learn about the preemptive rights of shareholders in Florida. The statute establishes what shareholders do and do not have the right to. The statute can be viewed on Online Sunshine, the official website for the Florida legislature.
Primer on Florida Business Disputes– Read a PDF from the Florida Bar Business Law Section over Florida business disputes. The PDF discusses corporate litigation, shareholder agreement litigation and common claims. The Florida Bar Business Law Section is a resource for the state’s business lawyers.
Lawyer for Shareholder and Partner Disputes and Florida LLC in Miami, FL
Disputes involving shareholders, partners and LLCs are complex issues that require the guidance of experienced attorneys. Abrams Justice Trial Attorneys will fight to salvage the relationships between the parties involved so the corporation can continue to do business.
Call us today at (305) 709-0880 or submit your information in our online form and one of our attorneys will review your case for free. We assist clients in communities that include Miami, Homestead, Hialeah, Pinecrest, Miami Gardens, Miami Beach, North Miami, Doral, Coral Gables, and Cutler Bay.