What is a derivative lawsuit in San Diego and when is it the right alternative in a 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 business law protects the interests of minority shareholders. All too often majority shareholders and officers of the company attempt to “freeze out” the interests of minority shareholders. This can take the form of inappropriate distributions or bonuses. 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?
The shareholder may bring a “derivative lawsuit.” What is a derivative lawsuit in San Diego and is this an effective tactic? A derivative suite is generally speaking a lawsuit brought by the company against its own leadership. The derivative lawsuit allows minority shareholders to hold the actions of officers, Board members and other shareholders up to the light of the law. It is a very effective tactic for gaining access to the books and other valuable corporate information. 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.
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 contact us for a free consultation at 858-535-1511.