In business, everyone needs capital. Companies seek capital from investors and investors seek to gain a healthy return from those companies in which they invest their capital. When a company sells securities to an investor in exchange for their capital, the company’s directors and officers have fiduciary duties of loyalty, care, and disclosure to their investors. The trust in these fiduciary duties are the bedrock of the capital markets without which it ceases to function.
Warren Law Group is experienced in handling shareholder litigation matters in both state and federal court as well as arbitration. Litigation is brought by shareholders (on behalf of the corporation) against its officers or directors for many reasons. In some cases, shareholders bring suits against directors or officers for their actions that caused economic harm to their fellow shareholders, the corporation itself, other fiduciaries, such as fraud, negligence, and liability claims, frequently accompany such lawsuits. They are also commonly brought on their own.
If an officer or director of a company breaches their fiduciary duties of obedience, loyalty, and/or care, shareholders may seek damages and compensation, and sometimes receive punitive damages from the offending party, through litigation. Many activities can constitute a breach of fiduciary such as theft of business leads, withholding information from shareholders, breaching confidentiality agreements, and many other actions or inactions by a fiduciary.
Perhaps the most common type of shareholder litigation is brought by minority shareholders who are economically harmed by the decisions of their corporation’s officers or directors known as a “derivative action.” For example, a shareholder may disagree with the terms of a deal struck by the directors of a company and feel unfairly compensated or believe that the direction the board is taking the company is detrimental to the shareholder’s financial interests. Most derivative actions arise from a merger, acquisition, or other transaction which materially affects the value of a shareholder’s investment.
All owners, shareholders, and business partners have a right to a full and complete accounting of corporate books and records such as financial statements, meeting minutes, corporate resolutions, and agreements from transactions. If corporate officers neglect or decline to provide such accounting information, shareholders have a right to sue for access to those records and pursue any legal claims they discover in those records. Many investors are denied the ability to understand how their investment money was used which prevents them from knowing how their investment is performing. If a derivative action suit must be brought in the first place, it may indicate underlying malfeasance requiring further legal investigation.
Chris spoke with me daily, advised me and ultimately was able to negotiate a very fair settlement. Not only did he do right by me during the course of the negotiation but when it had been settled he took the time to review the settlement documents with me to ensure I understood everything. I would highly recommend Chris’ services to anyone in the financial services industry in need of legal help.
Christopher Warren’s good ideas made our work together very quick and very efficient. He’s smart, aggressive, and very much on my side. He’s not afraid to fight.
Christopher Warren has helped me get vindication in some very important arbitrations. He handled the legal world for me, so I could focus on my business. His firm understanding of the subject matter is the most important quality a lawyer can have. Chris understood the situation I was in. He identified with me, and that continues to mean a lot. I’m extremely thankful for him, and he remains a source of reassurance on all my legal matters.