Shareholder/Disputes

Business owners regularly call upon Pashman Stein Walder Hayden attorneys to help resolve disputes with their business partners before problems escalate into litigation. Once in litigation, our clients rely on us to vigorously protect both their interests and the well-being of their company. Whether it is a dispute over the taking of profits, the use of company assets, or a new strategic direction, the unfortunate reality for many businesses is that disputes inevitably arise among corporate owners and senior management. Pashman Stein Walder Hayden attorneys are experienced in anticipating problems that may develop, allowing us to skillfully assist clients in negotiating and drafting corporate governance documents that reduce the likelihood of future disputes.

Whether it is for a small family-owned business or a larger business venture, our attorneys prepare well-written and comprehensive ownership agreements that clearly define the rights and obligations of each owner, while helping to minimize complications that inevitably will occur. Formation documents prepared by our attorneys also provide fair and efficient mechanisms for resolving disputes among owners that are designed to reduce the disruption and costs that often are incurred in resolving such disputes.

When informal negotiations fail to produce a resolution, clients turn to PSWH attorneys who have a demonstrated track record of successfully vindicating their rights through litigation. When their business is on the precipice of being torn apart, clients rely on our attorneys to aggressively pursue their interests and defend their rights.

Our clients include officers, directors, and majority and minority shareholders. We prosecute and defend all matters of partnership disputes, including oppression of minority shareholder claims, dissolution proceedings, valuation proceedings, corporate governance disputes, claims of breaches of fiduciary duty, theft of corporate opportunities claims, breaches of restrictive covenants, and claims for advancement of legal fees and indemnification.

Our experienced litigators regularly appear in New Jersey’s Chancery Courts, where shareholder disputes typically are litigated. Shareholder litigations often begin with emergent requests for relief from the court, and Pashman Stein Walder Hayden attorneys are prepared to respond immediately to defend against or seek such relief.

Recent Representative Matters

• Pashman Stein Walder Hayden represented dissenting minority shareholders seeking a buyout of their interests in a closely held corporation, whose focus is the development of software for investment portfolio analysis. The matter involved complex issues concerning the effect of outside consulting agreements entered into by the individuals as well as the valuation of the respective ownership interests. A judgment was entered awarding our clients in excess of $3 million.
• The firm represented a leading New Jersey health care company seeking to divest a minority member of his shares as a result of his wrongful conduct, including breaches of fiduciary duty, misappropriation of corporate opportunities and assets. During the course of the litigation, the firm successfully enforced a restrictive covenant and obtained sanctions for the defendant’s violation of a preliminary injunction.
• The firm successfully obtained the dismissal of breaches of fiduciary duty claims and claims that certain family members were owners of various businesses founded by our client’s father. Despite the existence of 50-year-old stock certificates evidencing ownership in one of the companies, judgments were entered awarding plaintiffs no recovery.
• Pashman Stein Walder Hayden successfully represented a client with interests in multiple closely-held family businesses through mediation, which required the resolution of complex issues of ownership interests and valuation.
• The firm represented one 50% owner in an oppressed minority shareholder case, and after a two-week trial our client was awarded almost $200,000 in legal fees as a result of the frivolous claim brought by the other 50% owner.
• After a five-day bench trial, the firm successfully obtained a no- cause- of- action and dismissal of a case brought against the owner of a closely-held business who was sued by someone claiming to be a 50% owner of the business.