Minnesota’s New LLC Act – Increases Value of Operating Agreement Every small business has to adapt and change to succeed. Changing often brings friction among co-owners that can lead to expensive lawsuits. Before Minnesota passed its revised LLC Act, effective in 2015, the dissenters’ rights provision was a tool where members that opposed a major change such as a merger could assert [...]
Forum Selection Clause Unenforceable in North Dakota for Purposes of Enforcing Non-Compete Agreement North Dakota law has long prohibited non-compete agreements in employment contracts. See N.D.C.C. §9-08-06. Companies that employ North Dakota residents have tried to work around this law by, for example, for out-of-state companies, entering employment contracts applying the laws of their home [...]
What rights do you have as a shareholder when the person or people in control of the company engage in deception, fraud or theft? In the shareholder context, this question relates to the concept of breach of fiduciary duty. A fiduciary duty is a responsibility arising out of special relationships between certain parties. It is the highest duty implied by law and requires the fiduciary to act in[...]
Bringing or defending a lawsuit in federal or state district courts is an outrageously expensive endeavor. Even simple cases in state district courts will likely costs more than $25,000.00 in attorney's fees to have a trial. In real estate transactions and increasingly in many other areas, buyers and sellers commonly sign an agreement to arbitrate disputes not through the courts but instead [...]
AN OVERVIEW You are co-owner of a successful business, but your business partner and good friend has run into hard times. His life is upside down and he is in the middle of a nasty divorce and desperate for money. Because his personal distractions have kept him away from the business, he has taken advances against future earnings without consulting you, and you believe he has misused his position[...]
Many recent media reports have covered criminal prosecutions involving alleged ‘equity stripping scams'. But when you take a closer look at the circumstances of each case, it becomes much more difficult to separate the victim from the villain. The typical case involves a homeowner who is down on his or her luck and behind on his or her mortgage payments. The homeowner's mortgage lender has [...]
One question we encounter often in our practice from businesses and employees is whether the non-compete agreements they have signed can be enforced. The non-compete agreements (also known as covenants not to compete or non-solicitation agreements, among other things) at issue often prohibit former employees, contractors or owners from competing with a business following the termination of their [...]
So often in business litigation we see disputes regarding the use or disclosure of so called “confidential and/or proprietary” information or “trade secrets.” In a typical scenario, a former employee, officer or partner leaves his or her old company “ABC Electronics” and forms a new competing venture, “XYZ Electronics.” Sometimes though, it may be a potential business [...]
We are frequently approached by shareholders or members of small businesses struggling to figure out what duties they have to the company or whether others involved with the company have run afoul of such duties. Typical issues include: Mismanagement that has resulted in serious liability; Management has taken business opportunities that belonged to the company; There has been [...]
Can you sue a company officer in North Dakota for mismanaging the company? One issue that often confronts shareholders is when a controlling officer or manager of the company mismanages company business or misappropriates company assets. In general, such acts represent harm to the business rather than the individual shareholders or members. To bring a legal action in North Dakota, and [...]