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Business Divorce

Best Law Firms Tier 1 Arbitration, Mediation, Personal Injury

Aiken Schenk is a Best Law Firms® Metropolitan Tier 1 (Phoenix) Honoree for Commercial Litigation

 

  Business Divorce

Substantial, unresolved ownership conflicts often lead to a “business divorce.”

In recent years, Aiken Schenk has represented business owners and investors in a variety of high-stakes business divorces, including the following:

  • Asset Mismanagement. In a New Mexico case, Shawn Aiken and Heather Macre achieved a very favorable arbitration award, resolving over $3 million in claims. The dispute arose out of an investment partnership dissolution stemming and mismanagement of business assets by the managing partner.

  • Investor Dispute. In another arbitration, Joe Schenk and Shawn Aiken obtained a multimillion-dollar award for the managing agent/developer in a dispute contrived by its long-time investment partner.

  • Business Mismanagement. Phil Rupprecht successfully defended all of the mismanagement claims against an officer/director and then negotiated a very favorable purchase of the disgruntled shareholder’s stock, ending the dispute.

  • Securities Fraud. The Arizona Court of Appeals remanded for retrial a securities fraud case successfully argued by Joe Schenk and Craig Van Voorhees (since retired) on behalf of plaintiffs who had invested in a business operated by other family members.

  • Business Divorce. Heather Macre successfully arbitrated discount rates, trade secrets and breach of contract claims for a Tucson-based company, resulting in her client buying out the other owner on very favorable terms.

  • Shareholder Dispute. Shawn Aiken favorably resolved an ongoing power struggle between two major shareholders of a multimillion-dollar technology company, simultaneously protecting the company’s market-leading intellectual property while preventing judicial dissolution and successfully defending it against allegations of shareholder oppression.

  • Breach of Fiduciary Duty. Joe Schenk successfully defended an owner of a specialty surgery center against breach of contract and bad faith claims by a fellow owner. After less than 30 minutes of deliberation, the jury reached a unanimous defense verdict for our client and another unanimous verdict on the counterclaim.

  • Breach of Fiduciary Duty. Phil Rupprecht successfully pursued the rights of a minority owner of a local company who discovered that the other owners (all family members) were running the company for their own benefit.

Business Divorce: Related Issues

Business divorces can often involve a number of complex, overlapping issues including:

  • Claims that management breached fiduciary or other duties owed to equity holders

  • Conflicts between managing and non-managing owners

  • Ill-defined management roles

  • Securities fraud

  • Capital calls and other business financial strains that put investor interests under pressure

  • Dissatisfaction with financial returns

  • Disagreements over major business decisions such as acquisitions, sales, diversification and business succession

  • Disagreements over economic forecasts

  • Disputes over income distributions versus retention and reinvestment

  • Incompatible levels of risk tolerance

  • Unwillingness to personally guarantee debts of the company

  • Minority member or shareholder dissatisfaction

  • Actual divorce (i.e., marital dissolution) of an owner

  • Other changes in an owner’s personal situation (death, illness, incapacity, personal financial strains, capital needs of other business interests, etc.)

  • Non-compete restrictions on departing owners

  • Demands made by inherited equity interests

  • Poor planning regarding business governance