Shareholder and Stockholder Disputes

MASSACHUSETTS CORPORATE LITIGATION ATTORNEYS

Business conflicts within closely held or family-owned businesses usually require legal counsel to analyze the operating agreements, partnership agreements, or corporate bylaws that were created when the business was first formed. These guiding documents must be interpreted to determine the rights and responsibilities of stockholders and shareholders. Our corporate litigation attorneys provide advice and legal guidance in shareholder disputes of all kinds, including:

• Disputes over intellectual property and trade secrets
• Financial disputes, dividend issues and questions about returns on investment
• Breach of contract cases
• Hiring and employment disputes
• Derivative lawsuits
• Shareholder oppression litigation
• Breach of fiduciary duty claims
• Fraud or deceptive practices
• Business succession disputes
• Real estate disputes
• Partnership breakups and business divorces

SHAREHOLDER DISPUTES IN MASSACHUSETTS COMPANIES

Shareholder and stockholder disputes need not rise to the level of costly litigation. Resolving these disputes via negotiation and compromise is often less costly and has the added benefit of helping maintain important personal relationships in a closely held business, a family commercial operation or a business partnership.

Our goal in every business dispute is to protect our client’s financial interests and long-term ownership interest in the company. For example, it may be necessary to file a lawsuit immediately to protect a minority shareholder’s rights and preserve the financial resources and business contracts of the company. In other cases, the best course of action may initially involve negotiations and alternative dispute resolution. If these approaches fail to resolve the dispute, we have the experience and knowledge to forcefully defend a client’s business rights via litigation.

Highlights of our representative experience include:

• Business “divorces,” stockholder disputes and employment matters, wrongful termination, severance agreements, non-compete agreements, non-solicitation agreements and stock option agreements, including the following businesses (partial list), which were litigated in various courts, involving millions of dollars (many others, not listed below, have been settled without litigation and are therefore not public):
  • Garrett Harker(representation relative to buyout from Row 34 and Island Creek restaurants)
  • Michael Popitz v. Popitz LLC d/b/a Airflow Sleep(representation of company founder in stockholder dispute)
  • Mahi Gold, Inc.(representation of company founder relative to stockholder dispute)
  • Rasky Partners, Inc.(represented Larry Rasky in reorganization of his strategic communications firm and related buyout of company partners)
  • Marc Berkowitz vs. Legal Seafoods, Inc.(represented employee/minority stockholder in business dispute involving his brother, mother and father)
  • James Cafarelli v. Todd English et al.(represented minority stockholder in dispute resulting in division of business assets)
  • Burke Distributing Corporation v. Anissa Noreke, Minority Shareholder (represented minority stockholder relative to derivative claims resulting in settlement and dismissal of lawsuit filed in Suffolk Superior Court)
  • Edward Shulkin v. Gift Card Partners, Inc., et al.(represented shareholder and his estate in business dispute resulting in buyout)
  • Green v. Green(represented one of two brothers that were owners of substantial real estate holdings in dispute between them)
  • Quality Components, Inc.(represented majority owner of specialty fastener and solar energy component parts company in stockholder dispute)
  • Newbury Guest House and Harborside Inn(represented son/stockholder in dispute involving family owned hotels)
  • Air Carrier Support, Incorporated(represented minority stockholder in air transport company)
  • Color Technology, Inc.(represented minority stockholder in stockholder dispute)
  • Gilcorp, Inc.(represented company owning several restaurants and majority stockholder in employee/ stockholder dispute)
  • Security Source, Inc.(represented minority stockholder in stockholder dispute regarding security device company)
  • Austin Sportswear, Inc.(represented 50% owner in stockholder dispute with his brother regarding clothing/sportswear company)
  • Prophecy Development, Inc.(obtained substantial judgment for minority stockholder against other stockholder in intellectual property dispute)
  • Barnsider Group(represented employee/minority stockholder of company owning chain of restaurants resulting in settlement of stockholder dispute)
  • United Marble Fabricators, Inc.(represented former stockholder in suit to enforce non-compete agreement)
  • Davio’s Restaurant(represented restaurant in wrongful termination case decided in favor of employer after jury trial)
  • Colla’s Super Markets, Inc.(represented minority stockholder in family owned business)
  • Curtain Insurance Agency, In (represented minority stockholder in stockholder dispute)
  • Formaggio Kitchens(represented employee/ minority stockholder suit against majority stockholder of gourmet food business resulting in buyout of majority stockholder)
  • Electric Supply Center Corp.(represented stockholder in dispute with other stockholder/owner of an electrical supply distributor)
  • National American Rubber Thread Company, Inc.(represented majority stockholder in litigation involving other stockholders)
  • Porthole Pub and Restaurant(represented employee/minority stockholder in family owned business)
  • Waves, Inc.(represented employees/ stockholders in dispute involving other stockholders)
  • AIAL, Inc. (represented investor/stockholders in airline company in stockholder suit)
  • Tapeo, Inc. (represented majority stockholder and company in suit involving minority stockholder owners of company)
  • Vinny Testa’s(represented minority stockholder/employee in dispute with majority stockholders)
  • New Angle Glass(represented company in litigation regarding employment agreement with non-compete clause)
  • Standard Electric(represented Electric Supply Center which hired new employees that had non-compete clauses in employment agreement with former employer)

If you anticipate a shareholder dispute, it’s important to develop a plan of action as early as possible. Call Jim Rudolph or Jon Friedmann at 617.723.7700 or contact us online.