Corporate Integrity Challenge

The Problem

In a closely held corporation, the CEO, who holds the majority stake, diverts company funds for personal use, breaches the operating agreement, and misrepresents the company’s financial health to minority shareholders. This leads to financial harm and minority shareholder oppression.

The Solution

The CPM attorney brought a suit on behalf of a minority shareholder on claims of breach of operating agreement, fraud, conversion, minority shareholder oppression, negligent misrepresentation, misappropriation of company funds, and tortious interference with business relations. The attorney was able to secure a positive, pre-trial settlement, and, once the settlement was breached, was able to secure judgment for joint and several liability against the business and the remaining shareholder.