Practice
Partner and owner disputes
When the people who own a business together stop agreeing on money, control, or who leaves.
Owner disputes are lawsuits between people who used to trust each other. They tend to be about the books, a buyout price, or one owner shutting another out of decisions.
Merritt represents individual owners and the companies themselves, in LLCs, partnerships and closely held corporations. She starts with the operating agreement or bylaws, because that document usually decides more than the law does. Many of these cases end in a negotiated buyout; some need a court to order one.
Which side
Owners who were squeezed out or kept from the books
Owners accused of mismanaging the company
Family members who inherited a share
What these disputes are about
Buyouts and valuation
What a departing owner’s share is worth, and how and when it gets paid.
Access to the books
Getting the records you’re entitled to see as an owner.
Freeze-outs
An owner cut out of pay, decisions or distributions by the others.
Breach of fiduciary duty
Self-dealing, diverted customers, or money moved out of the company.
Deadlock and dissolution
When owners can’t agree on anything and someone asks a court to end the company.
Family businesses
Shares passed down to relatives who never agreed on how to run the place.
Questions
What people ask about partner and owner disputes
We never signed an operating agreement. What rules apply?
The state’s default rules for that kind of company fill the gap. They’re often not what owners assume, so it’s worth reading them before you act.
Can I be removed as an owner?
Usually not just by a vote, unless the agreement allows it. You can be removed as a manager or officer more easily, which is a different thing.
Should I keep coming to work while this is going on?
Often yes, but it depends on your role and what the others are doing. Don’t take records or money out of the company before you’ve had advice.
Does a buyout always mean a lawsuit?
No. Many end with a negotiated price and a written agreement. A lawsuit is what happens when one side won’t negotiate at all.
In business with someone you no longer trust?
Bring the operating agreement, or tell her there isn’t one. You’ll leave knowing your options.