Could a Shareholder Dispute Hurt Sony Pictures?
Hoffman Estates Attorneys Discuss the Sony Fallout
As a business owner, you understand the important relationship between the shareholder and your company. Unfortunately, shareholder disputes can sometimes seem irreconcilable. This is when it is wise to have someone else step in. An experienced business litigation attorney can resolve disputes and alleviate any concerns about your business’s future.
Can Shareholders Sue the Company?
Recently, the Hollywood Reporter published an article about Sony Pictures Entertainment and their shareholders. The article indicates that Sony Corp. shareholders could sue Sony Pictures for losses. The entertainment company has already endured several setbacks, including six class action lawsuits in one week over a personal data breach, pirated films and financial losses on The Interview.
This begs the question: “What can a shareholder do to vindicate their interests?”
Shareholders have the option of making a direct action or an indirect, derivative action. The direct action involves the shareholders suing in their capacity as shareholders to enforce their rights. The derivative action involves the shareholders suing on the behalf of the corporation to impose the corporate rights that indirectly affect them.
There are a few factors involved in deciding whether to sue for direct or indirect damages. These factors include:
- Who pays the expenses for litigation
- Who recovers what is secured in litigation
- What procedures apply to the shareholder(s) who file the lawsuit
- Whether the suit can be dismissed by the corporation or not
It should also be noted that shareholders cannot sue anytime they disagree with a company or corporate decision. In most cases, the court will defer to the board of directors if it is a business matter, unless the shareholders can prove that directors were involved in fraud, negligence or illegal activity. In the event of a major disagreement, shareholders will generally vote to resolve the disagreement.
Disputes can be resolved outside of the courthouse in order to try to keep costs lower and the dispute less public. Popular methods of resolving a dispute out of court include arbitration and mediation.
Shareholder Dispute Attorneys Settle Contentious Claims
A great way to avoid a shareholder dispute is by planning for the possibility of such a dispute before it happens. If you wish to prevent a shareholder dispute, or if you are already involved in one, then call a business litigation attorney today to see what your legal options are. The Des Plaines attorneys at Pluymert, MacDonald, Hargrove & Lee, Ltd. have experience resolving shareholder disputes through wide range of strategies.