Shareholder issues can lead to complex civil litigation

On Behalf of | Mar 27, 2019 | Civil Litigation

Because of the many different people and pieces involved in running businesses, it is common for disputes to come about. Owners, partners, shareholders, employees and numerous other individuals associated with a company could have reason to voice concerns over certain aspects of a company or its actions. However, in some cases, those concerns could lead to complex civil litigation if resolutions to conflicts are not easily found.

California readers may be interested in a shareholder dispute that recently reached a ruling in another state. According to reports, four shareholders of a gas and electric company took issue with the fact that the company had not drafted a clean energy plan that would result in the utilization of 100 percent renewable energy by 2050. They claim that the company used new federal guidelines to get out of creating this plan.

The company itself claimed that the shareholders were attempting to micromanage the company. Recent changes to U.S. Securities and Exchange Commission guidelines broadened the definition of micromanaging, which plays more to the favor of corporations. Indeed, in this case, the SEC ruled in favor of the energy company, and the resolution to draft the plan could be removed from proxy materials for the next shareholder vote.

It is easy for individuals to feel as if they are fighting against their own side when business disputes arise. Still, it is important that any conflicts are thoroughly reviewed and that resolutions are reached. If California business owners are facing shareholder disputes, they may want to ensure that they understand their legal options for complex civil litigation.

FindLaw Network
Gary Jay Kaufman
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