What is a derivative lawsuit in San Diego and when is it a viable option for a San Diego shareholder dispute? How can minority shareholders protect the company and hold major shareholders accountable? When any shareholder in a corporation believes the company is headed in the wrong direction or has concerns about the actions of majority shareholders, officers or the Board of Directors they are entitled to bring a derivative lawsuit on behalf of the company against its leadership.
California Laws Protect Minority Shareholders and Investors
California business law protects the interests of minority shareholders and investors. All too often majority shareholders and officers of the company attempt to “freeze out” the interests of minority shareholders and investors. This can take the form of inappropriate distributions or bonuses, or the failure to pay each member of a class of shareholders the same dividends or benefits. It can manifest in the form of poor decision making or investments. There may be a conflict of interest for one of the corporate officers or board members. How does a minority shareholder stand up to the bullying or poor business practices of controlling interests?
What is a Derivative Lawsuit?
What is a derivative lawsuit and when is this a viable option to consider? Is this an effective tactic? A derivative action is, generally speaking, a lawsuit brought by the company against its own leadership on behalf of the company itself. The derivative lawsuit allows minority shareholders to hold the actions of officers, Board members and other shareholders up to the light of the law.
A derivative lawsuit seeks damages for the company on behalf of the company and redress for the actions or inactions of associated company management, owners, directors or executives.
It is a very effective tactic for gaining access to the books and other valuable corporate information and protecting your company from potentially damaging actions by the company’s management team or an individual member of leadership. A derivative lawsuit places the power of California law behind you so that you can get to the bottom of an issue and hold responsible parties accountable for the mismanagement or a violation of their duties and fiduciary responsibilities on behalf of the company itself.
You Need The Experienced Shareholder and Investor Dispute Attorneys at the Watkins Firm
Now that you know a little more about the question of what is a derivative lawsuit in San Diego and when is it a viable option you probably need legal advice and counsel. The Watkins Firm has decades of experience helping to bring a derivative lawsuit in San Diego on behalf of minority shareholder interests. We are experienced business litigation attorneys who will assert and protect your interests while ensuring that majority interests and officers of the company abide by California laws and best business practices. We invite you to review the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
