Corporate Governance and Shareholder Litigation
It has been said often that a business entity is a legal fiction — i.e., a business exists, but it can only act through its shareholders, members, partners, directors, officers and other constituents. The relationships among the parties making up a business entity are controlled by its governing documents, which, along with statutes, create rights and obligations between the parties.
Ideally, because all parties want what is in the best interest of the entity, the entity operates without issue. When disagreements or disputes arise over a decision or course of action taken in the name of an entity, it becomes necessary to ascertain the rights and obligations of the parties under its governing documents and the applicable statutes.
Whether your dispute involves a corporation, partnership or LLC, Houston Harbaugh, P.C., in Pittsburgh, Pennsylvania, has extensive experience representing clients in corporate governance matters.
Corporate Governance Problems
Corporate governance embraces a wide range of issues and disputes as varied and diverse as the types of entities and constituents who face them and include the following:
Direct and Derivative Shareholder Litigation
When shareholders, members or partners disagree with the course of action taken by entities, they might elect to bring suit against the company’s directors or officers. In some instances, however, they must make demands on the entity to redress the harm before they can do so. This is especially true if the corporation or entity, rather than the individual shareholder, member or partner sustains the injury. These types of lawsuits initiated by equity owners of companies are more formally known as direct and derivative litigation.
Our attorneys are well-versed with direct and derivative litigation, having represented companies, directors, officers and, in certain instances, equity holders in business disputes involving challenges to the business judgment of company management and allegations of breach of fiduciary duty and other abuses of the corporate form.
Not every corporate governance dispute results in litigation. It is not uncommon for corporate disputes to begin with an assessment of the rights of the aggrieved shareholder, member or partner under the entity’s governing documents and end with the formulation of an appropriate response in response to the demand. Depending on the type of entity involved, these rights may include the right to vote, the right to inspect corporate books, or the right to an accounting, among others.
Our attorneys have extensive experience advising both companies and their constituents of their rights and obligations under incorporation documents and corresponding statutes. Whenever possible, they seek to devise strategies that literally meet the demands of shareholders, members, and partners without litigation.
Get Skilled Guidance for Your Shareholder Dispute
For more information, call 412-281-5060 or send our litigation lawyers an e-mail by completing the contact form on this website. From our office in Pittsburgh, we represent clients throughout Pennsylvania. We also handle corporate governance issues out of state on a special admissions basis.