Shareholder disputes can have a significant impact on the financial security, reputation, and future of your business. Indianapolis shareholder dispute lawyer Michael J. Adler has assisted companies and shareholders in a variety of litigation for over 15 years, ranging from appraisal rights and corporate records inspections to claims of self-dealing and breaches of fiduciary duties. With his extensive experience as a business litigation attorney, Mr. Adler can identify strategies to seek a favorable resolution of shareholder disputes, negotiate settlement agreements, or if a trial is necessary, represent a company or its shareholders in the courtroom.Common Types of Shareholder Disputes in Indiana
A corporation is formed to carry out a business purpose, and it is a distinct legal entity from its members. Essentially, shareholders are the owners of the company, and any person or organization that owns a share of the company’s stock is a shareholder. Shareholders have the potential to gain or lose their investment, but they are not personally liable for the company’s debts or obligations. The rights of shareholders are specific to each company, as defined in the corporation’s governing charter and bylaws. These may include the right to inspect the company’s books and records and bring suit against the company for wrongdoing.
In most corporations, shareholders are not involved in running the company, although common shareholders will generally have the right to vote on corporate matters, such as merger proposals and appointments of directors to the board, while preferred shareholders typically do not have voting rights. Closely held corporations, however, have a small handful of shareholders, who own and often operate the company without a board of directors.
In Indiana, the directors and officers of a corporation have a duty to act in good faith and in a manner they reasonably believe to be in the best interests of the corporation. They must also refrain from self-dealing, or using their position for personal profit at the expense of the company. Directors and officers are generally shielded from personal liability unless they engage in willful or reckless misconduct. In closely held corporations, the shareholders have a fiduciary duty to other shareholders to deal fairly, honestly, and openly with the corporation and their fellow shareholders.
Shareholder disputes may arise if a director or shareholder of a closely held corporation breaches his or her fiduciary duties. For example, a director who fails to disclose his or her financial interest in a company transaction may be found to have engaged in self-dealing and breached a duty of loyalty. Shareholder disputes may also occur if the board fails to comply with state or federal laws or the corporation’s charter and bylaws, which may provide rules regarding the distribution of dividends, sale of shares, and acquisition of shares. An attorney can advise as to whether a wrongful action has occurred and provide recommendations for resolving the dispute.Enlist an Indianapolis Lawyer for a Shareholder Dispute
Indianapolis shareholder dispute attorney Michael J. Adler advises companies, owners, and shareholders in a wide range of business matters, including partnership disputes, commercial torts, breaches of contract, and more. Mr. Adler is an active participant in the legal community, serving as a Vigo County Trial Deputy Prosecutor and as a member of the Indianapolis Bar Association and Indiana Trial Lawyers Association. He has assisted businesses and individuals in Indianapolis, Carmel, Westfield, Fishers, Zionsville, Greenwood, and other communities across Boone, Marion, Hamilton, Johnson, and Vigo Counties. Call Adler Law LLC at 317-635-7880 or contact us online for a free consultation with a commercial law attorney.