What do you need to know about breach of fiduciary duty by a corporate officer in California? If you are a minority shareholder or have an interest in a corporation it is important to know when the decisions and/or actions of an executive, majority shareholder, director or officer harm your interests.
The directors, executives and officers of a corporation have a legal “fiduciary duty” to protect the corporation from those who would harm it. If there is a breach of the fiduciary duty by a corporate officer or they have taken an action which is against the best interest of the corporation or your interests as a shareholder it is prudent to evaluate what has happened and meet with an experienced business attorney at the Watkins Firm. We bring more than 40 years of experience to protect the interests of our clients. In most cases we are able to negotiate a successful resolution to the interest at hand while protecting our client’s interests.
In other situations, it may be prudent to consider a derivative lawsuit on behalf of the corporation itself. Most derivative lawsuits are brought against a particular director or officer for breach of contract or breach of fiduciary duty. You may also consider a derivative lawsuit in San Diego if the actions are the result of a professional such as an accountant or tax adviser.
Because a shareholder files a derivative lawsuit on behalf of the corporation, any financial damages resulting from a derivative lawsuit belong to the corporation itself, rather than the shareholder who initiated the lawsuit. Cases that involve a breach of the fiduciary duty of a corporate officer in California are legally quite complex. The Watkins Firm has more than four decades of experience and a successful proven track record of defending shareholders rights and taking immediate action to protect the position of minority shareholders.
We help our clients to resolve shareholder disputes and take a unique approach which is designed to accomplish our client’s goals and objectives in the shortest possible time frame and in a cost-effective manner. This includes, but is not limited to negotiation, mediation, arbitration and when necessary litigation or a derivative action.
Pro-Tip: “Everybody hears the term conflict of interest and they think it’s something like special or amazing or complicated, but it’s really not. This is the oldest con game. There is example of the person working somewhere who gets access to checks coming in. So they form a company in another state that sounds just like the name on the checks that are coming in. And they start taking those checks and putting them in their own bank account.
Well, think about that. If you’re a corporation you’re in management and you have an uncle that forms a company and you start sending business that way, and before, you know it, you taking assets from one company and giving it to another company, which technically you don’t have anything in writing as an ownership of, but you have a conflict of interest and you’re breaching your fiduciary duty. And so if the shareholders aren’t watching this happens, and I would say 20% of our litigation every month is based on shareholder disputes fights between shareholders and the corporation and breach of fiduciary duty
The fiduciary duty is basically the obligation to act in the best interests of those that they serve, or manage, because they have such an advantage. The term fiduciary duty comes in this definition when somebody has an advantage of knowledge of power of money over somebody else who’s invested in good faith. They have a duty not just to do what the contracts say, but they have a duty to be a fiduciary to take their position in favor the shareholder and against themselves, if there is a conflict. So they have the utmost duty to disclose and to act in good faith for the interest of the shareholder.” – Dan Watkins, Founding Partner
Are you facing a breach of fiduciary duty by a corporate officer in San Diego or anywhere in California? Shareholders always have a right to take legal action when the officers or directors of a corporation fail to act in the best interests of the corporation itself. What is the best strategy to protect your interests as a shareholder and accomplish your objectives?
We invite you to review our podcast Episode 14 – Shareholders’ Rights as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
