Disputes between business owners are some of the most personal cases we handle. The owners often built the company together, and the dispute can threaten the business itself.
Our goal is a resolution that protects the client's investment, whether that comes through negotiation, a buyout, mediation or litigation. When owners are ready to separate on agreed terms, our transactional team can document a partner buyout.
Partners in a general partnership owe each other duties of loyalty and care, and managers and officers owe duties to the company. Disputes arise when an owner diverts opportunities, misuses company funds or competes with the business.
Disagreements over distributions, capital contributions, compensation or unauthorized expenses.
Clashes over strategy, hiring, spending or day-to-day operations.
An owner ignoring the company agreement, partnership agreement or shareholder agreement.
One owner wants to leave or sell, and there is no clear exit plan.
Accusations of embezzlement, improper accounting or hidden information.
One owner buys the other's interest, often under a price or process set by the governing documents.
Compensation for losses caused by an owner's breach of duty or of the governing documents.
Court orders that stop harmful conduct, such as diverting customers or company funds, while the case proceeds.
Enforcing an owner's right to inspect the company's books.
In limited circumstances, a court can appoint a receiver or order the business wound up.
These disputes arise in general and limited partnerships, LLCs, closely held corporations and joint ventures. The rules differ for each, and the governing documents often matter more than the default statutes, so we start with the agreements the owners signed.
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Ask a QuestionBusiness divorce is a common term for the separation of co-owners, whether through a negotiated buyout, a sale of the company or litigation. As with a personal divorce, it involves dividing value and untangling shared obligations, and the governing documents often set the rules.
Not automatically. Texas law has not settled whether LLC members owe formal fiduciary duties to each other, and the company agreement can expand, restrict or even eliminate the duties of members and managers. Managers and officers generally owe duties to the company. In most cases, the company agreement is the place to start.
Usually, yes. Texas law gives LLC members and shareholders the right to inspect company books and records on a written request that states a proper purpose, and shareholders generally must meet a minimum holding period or ownership level. Partners have broad access to the partnership's books and records. A records request is often an early step in an owner dispute.
Often, yes. Many company agreements require mediation or arbitration, and courts frequently order mediation anyway. Mediation keeps the dispute private and lets the owners shape the outcome, including terms a court couldn't order.
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