The end of a business partnership is a journey fraught with legal, financial, and emotional complexities. For owners of closely held corporations, LLCs, and partnerships, a “business divorce” requires a strategic, multi-disciplinary approach. I developed “Happily Business Divorced 2025,” a comprehensive seminar presented by the New Jersey Institute for Continuing Legal Education (NJICLE) on Friday,…

Key Takeaways:

• Minority shareholders in closely held corporations may face a challenge to their investment due to their lack of control over company decisions.
• Legal protections do exist to safeguard their interests, including rights to financial information, fair treatment, and avenues for relief in cases of oppression.

Key Takeaways

• A minority shareholder oppression claim requires clear evidence of damages, including a reliable valuation of the business.
• In Jennings v. Simmons, the plaintiff’s failure to present valuation evidence prevented the court from awarding damages.
• The court ruled that without financial records or expert testimony, it could not determine the fair value of the

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• Shareholder Disputes in closely held corporations are common and often arise from voting deadlocks, financial disagreements, and claims of minority shareholder oppression.
• New York law provides several legal remedies, including dissolution proceedings, buyouts, and derivative lawsuits.
• Preventative measures, such as well-drafted shareholder agreements, can mitigate future disputes.

Key Takeaways: When to Seek Judicial Dissolution of an LLC

• What is Judicial Dissolution? A court-ordered termination of an LLC when voluntary dissolution is not an option.
• When Should You Seek It?
  • Deadlock among members preventing essential business decisions.
  • Conflicts that make business operations impossible.
  • Fraud, oppression, or misconduct by controlling members.
  • The LLC can

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• Advances or capital contributions made to a limited liability company without authorization may be a source of conflict.
• Using unauthorized advances or capital contributions as a means to exert control may be a breach of fiduciary duty.
• A well-drawn operating agreement addresses how and when the owners put additional money into a limited liability company.

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• Shareholder disputes in a closely held business threaten the business and personal financial interests of the owner.
• New Jersey law provides the owners of a closely held corporation with rights and remedies that assure access to information and the financial benefits of ownership.
• Closely held corporations can use effective planning and negotiated solutions to avoid

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