Business partnerships often begin between friends or relatives, with a handshake and a 50/50 split. When the relationship breaks down, the business can become paralyzed. Neither side can make decisions, money goes missing, or one partner is simply locked out. We represent shareholders, LLC members and partners on both sides of these disputes.
Disputes we handle
- Deadlock. When owners are evenly split and the company cannot function.
- Freeze-outs and oppression. A minority owner is excluded from management, denied information or cut off from distributions.
- Breach of fiduciary duty. Diverting company funds, opportunities or customers to a competing business.
- Books and records demands. Enforcing an owner’s right to inspect financial records.
- Buyouts and valuation. Negotiating or litigating the fair value of an owner’s interest.
- Judicial dissolution. Asking the court to dissolve a corporation or LLC, or defending against such a petition. The standards differ significantly between corporations and LLCs under New York law.
Our approach
These cases are as much about leverage as about law. How a petition is framed can determine who ends up buying whom, and at what price. We move early to protect company assets and records, often through a temporary restraining order, while exploring whether a negotiated buyout or division of the business can end the dispute faster than litigation.
We also help owners avoid these disputes in the first place by drafting deadlock and buy-sell provisions at formation. See Business Formation & Advisory, and read our article on 50/50 shareholder deadlock (in Chinese).