What is a derivative lawsuit for a San Diego corporation, and when should a shareholder consider this business option?  A “derivative lawsuit” is a type of shareholder dispute, where a minority shareholder or part-owner in a company believes the company’s board of directors has failed to take action, or where the board is not acting in the best interests of the company.  Derivative actions are primarily used in cases of a conflict of interest, or when there has been a breach of fiduciary duty by an officer of the company, a board director, or high level executive.

A derivative lawsuit is actually brought on behalf of the corporation itself and is filed against the directors, executives, officers and/or majority shareholders who are suspected of wrongdoing.

A derivative lawsuit for a San Diego corporation may be the best option if you suspect:

  • Fraud
  • Illegal practices
  • Self-dealing
  • Acting in the interest of a third party to the detriment of your corporation
  • Mismanagement

This is different from a “direct” action where the minority shareholder would personally file a lawsuit against the offending individual(s).  There are simply far less opportunities to bring a direct action, and therefore the experienced shareholder defense attorneys at Watkins Firm may recommend the derivative option.

Our attorneys have extensive experience in both direct and derivative actions, and provide sound counsel regarding the best strategy based upon your unique circumstances.

Filing a derivative lawsuit for a San Diego corporation can become extremely complex, and it is important to work with experienced business attorneys who can protect your interests while working quickly to preserve options for the future.  We have served the San Diego business community for decades, and have extensive experience in all areas of corporate law as well as shareholder disputes and derivative lawsuits.  We invite you to review the strong recommendations of our clients and contact the Watkins Firm or call for a complimentary consultation at 858-535-1511 so that we can discuss your unique situation and the best steps available to resolve existing issues or compel legal compliance.

Contact a Business Law Or Real Estate Attorney Today

To set up a free, no-obligation consultation with our knowledgeable San Diego business lawyers, call us at 858-535-1511 or contact us online.