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Guide to Resolving Shareholder Disputes

A Philadelphia partnership and shareholder disputes attorney can provide assistance when conflicts arise among shareholders. Unfortunately, shareholder disputes can arise frequently in closely held companies, as well as in larger organizations.  When a dispute arises, the future success of the organization could be affected because the disagreement could hurt the company's brand, make it impossible for co-owners to work together, and result in a delay in the making of important decisions. 

Due to the serious potential consequences associated with shareholder disputes, it is important to understand what options are available to resolve these disagreements in a timely and effective manner.

Curley & Rothman, LLC can provide you with assistance in resolving disputes in the best way possible for your organization. To find out more about the ways in which a Philadelphia partnership and shareholder disputes attorney can help you, give us a call today.

Guide to Resolving Shareholder Disputes

As soon as a shareholder dispute arises, there are certain steps you should take to find a resolution. The steps to coming to an agreement and finding common ground with co-owners include:

  • Referring to your partnership or shareholder agreement. Co-owners of a company should have created an agreement when starting the business together that sets forth each individual's responsibility and that establishes a process for resolving disagreements. If you have such a shareholder agreement in place, you should refer to it to see if it provides a resolution to your disagreement.
  • Referring to employment agreements: Does this agreement give one co-owner or group of co-owners authority over the decision which must be made? If so, you should defer to this agreement and let the person vested with responsibility in this area make the decision. The only exception is if you believe the person who is entrusted with decision-making authority is breaching a fiduciary duty to act in the best interests of the business organization.
  • Referencing your business plan. Do you have a business plan that all co-owners have signed onto? Refer to it and see which proposed decision or course of action is most in line with the goals that you have for your business.
  • Negotiating with help from a mediator. A mediator can provide you with help in reaching a compromise or coming to a consensus on the best approach forward for your company. Mediators facilitate effective communication, rather than imposing their well or adjudicating disputes between parties to a disagreement. The hope is that co-owners would be able to find ways to put their differences aside and come to a consensus once a third party helps them to make their unique positions known.

If these efforts fail, or if there are accusations of serious wrongdoing such as a co-owner of a company embezzling money or putting his own interest above those of the business, then litigation may become necessary. However, litigation should generally be viewed as a last resort in the resolution of shareholder disputes.

Litigation can be costly, and can be time consuming so your business may operate in limbo as you wait for a court to rule on your disagreement. Litigation can also permanently poison business relationships, as it is adversarial by nature. You don't want to sue your co-owners and take them to court if there is a way to avoid this, as it will be difficult to run a business successfully together after facing off in a legal battle.

How a Philadelphia Partnership and Shareholder Disputes Attorney Can Help

As soon as a disagreement arises among shareholders in your organization, you need to get legal help from a Philadelphia partnership and shareholder disputes attorney. With the right legal guidance, you may be able to find an effective resolution quickly before the dispute escalates and does damage to your brand or does damage to important business relationships.

Curley & Rothman, LLC has extensive experience assisting co-owners of companies in finding good ways to resolve disputes that keep your business relationships on firm footing and that can help your company to continue operating successfully.

When necessary, we also have the skill and ability to represent you in litigation and to argue for your preferred outcomes if you believe that the court must step in to address a problem with company shareholders. Give us a call today at 610-834-8819 or contact us to find out more about the ways in which we can help you to make sure your dispute doesn't derail your business success. You can also visit our website to learn more about what a Partner and Shareholder Dispute attorney can do to help you.