Among the numerous subfields of business law, shareholder litigation is one of the most common. Many corporations have shareholders or individuals who own a portion of the company via the purchase of shares. As joint owners of the business, these shareholders have rights that must be protected. If those rights are infringed upon, these shareholders also have the right to file a lawsuit against the corporation. So whether you are a shareholder looking to file a lawsuit or a corporation that is facing such a lawsuit, the commercial litigation attorneys at the Kleyman Law Group have the expertise required to ensure your rights are protected.
The governing bodies of corporations are obliged to provide specific types of information and uphold specified financial responsibilities to shareholders. In the state of New York, the shareholders of a corporation have specific legal rights to:
➢ Examine the corporation's books and records.
If shareholders who have owned stock in the corporation for at least six months or who own 20% or more of the total outstanding stock have a legal right to inspect:
The essential accounting records of the corporation,
The time duration of all meetings of shareholders, directors, or official committees,
The current list of all company's shareholders, including their names and addresses.
Any other records the corporation is required to keep by law.
➢ Attend annual shareholder meetings.
A shareholder can insist that an annual shareholder meeting be held.
Although any shareholder has this right to submit a written request for an annual meeting to be scheduled yet this practice is often overlooked in cases when the majority of the shareholders are also members of that company’s governing body that controls the daily operations.
➢ Receive the shareholder’s rightful share of the profits.
By law, shareholders must receive dividends proportional to their ownership stake. The sole exception is when several classes of stock, such as preferred and/or common, are held.
➢ Insist that the corporation registers shares in the shareholder's name.
The business shares should be issued and registered in the shareholder's name. This guarantees that the shareholder has legal evidence of ownership to defend their legal rights.
➢Be included in company growth and resultant privileges.
Successful corporations often seek to capitalize on new possibilities by growing their operations, and shareholders have the right to partake in that growth.
➢ File a lawsuit against the corporation for violation of shareholder rights.
If any of the aforementioned rights are breached, a shareholder does have the right to file a lawsuit against the corporation.
Get the Help of a Kleyman Law Group Commercial Litigation Lawyer
Are you a shareholder who believes your rights have been violated? Or Is your corporation facing a lawsuit brought against you by a shareholder?
The commercial litigation lawyers at Kleyman Law Group are prepared to fight for your legal rights. Our extensive experience in business law qualifies us to represent either side in a shareholder lawsuit, so you will never have to go without the legal protection you need.