How to Manage a Dispute with a Business Partner or Co-Owner in an LLC

Manage a Dispute with a Partner or Co-Owner in an LLC - Resolve

What happens when you get into a serious legal dispute with a partner or co-owner of an LLC?  When do you know if it’s time to seek counsel?  When a dispute arises between ownership in a business venture it is important to resolve it quickly and efficiently.  Disputes take your focus off of the business itself, and distract valuable resources and income.  How should you handle a dispute that is growing in intensity?

The first step you should take is to contact the Watkins Firm for a free and substantial consultation.  We’ll have a genuine conversation about the dispute you’re facing and the potential impact it could have on your business.  We’ll discuss all of the options available to you, and the necessity of each step.  We’ll establish firm budgets for each point in the process so that you can make sound business decisions.  More importantly, in that consultation we’ll provide the perspective of our decades of experience and skill in these matters, and guidance that you can begin to take action upon.

There are many factors that will guide the process to resolve a dispute with a partner or co-owner of an LLC.  The quality of the corporate documents and the operating agreement will have a strong bearing on the outcome of each step.  The underlying personal relationships, and the nature of family and preserving complex business relationships should be explored and factored.  Most of these disputes are resolved through well structured negotiations, and that is the most hopeful piece of news we can share in this format.  Our team will support you at each step, providing the best blend of services and counsel to ensure that you achieve your goals for the situation and work through it in a positive manner.

Dan Watkins Founding Partner of the Watkins FirmPro-Tip: “What are some of the most common things that might lead to a dispute between members of an LLC or business partners? There are going to be disagreements over a wide variety of things, but one universal thing we found after 40 years of doing it is once the company starts making money, people will naturally rationalize their position to allow them to make a larger share of that money. Once it starts making money it’s worth fighting over.

We want to get the facts down and we want the evidence they have in chronological order, because that’s the best way to communicate to the other party or to a third party, to anyone is in chronological order. That’s how we think. Then I want to help our clients analyze the damages. Whether you are feeling like they owe you something, they’re not complying with the agreement or vice versa. So I want to want something more from you than just to analyze the damages, we want to analyze what it’s going to cost to fight. And also look at the future business. Whether we can salvage this relationship, all of those important things should come into play, in order to give the right, best advice. Sometimes we’ll even advise our clients how we would think about it and then let them go talk to their partner or whoever they’re dealing with on their own armed with our knowledge and our negotiation technique.

Business partners are married to the dispute, they’re married to every little fact. And if they have any kind of good business skills, we can coach them give them the law in layman’s terms so that when they negotiate, they’re negotiating with the knowledge of what we would say and even more facts. So they can actually be better than us. I have an example of a client. I told them, you’re never going to get a better least negotiation than this. It’s not possible. And, uh, so we had long discussions about it. I gave him all the law strategies what’s going to happen if this happens. So what happens if that happens? And he went and talked to the other side and got twice the deal we thought might be possible.”

You shouldn’t face these situations alone, and we invite you to review our podcast Episode 11 – Resolve Business Disputes as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today. Taking action in and of itself will bring some peace of mind.  You should leave that call encouraged, informed and better supported to begin to make important decisions that will lead to the resolution of your dispute with a partner or co-owner in an LLC.