A high business “tide” does not necessarily float all boats.  Often, when business is good and profits increasing, a business owner’s desire to share those increasing profits with an underperforming partner can create an irreconcilable divide; particularly in the case of a partner not intimately involved in the day to day operations of the business.  Similarly, more difficult economic times stress cash flow and may motivate a performing partner to explore options to decrease or eliminate that portion of the business income flowing to those performing at a lower level.  Of course, the lesser performing partner generally adopts a contrary perspective.  In either case, the divergence between two or more partners can render the status quo unacceptable and threaten the business as a going concern.

In approaching disputes among shareholders several factors must be considered.  First, what are the respective goals of the parties? Certainly, the long term goal of extracting the most gain in income or the value of the investment is the goal of all the parties, but short terms strategies can have a dramatic and sometimes unintended consequence.  Second, what does the controlling agreement, if any, provide in terms of a basis to remove or force a sale of a partner’s interest? Significantly, there is no statutory right or method for the involuntary removal of a shareholder (arguably, such a remedy may be available in a Partnership or Limited Liability Company setting)   Third, what is the long term impact of the potential short term strategies not only on the business but also on the individuals? Financing arrangements and personal guarantees must be considered.  Finally, the respective rights and obligations of the shareholders post dissolution must guide the process.

Of course, potential courses of action do not come without risk for either side of the equation.  An internal business dispute can result in a loss of control over business operations or expensive and distracting litigation.  The team at AMM offers a depth of knowledge and experience to guide a business owner’s decision making process and to devise and implement strategies to maximize outcomes and manage risk. 

Business owners use the term “partner” to refer to any number of different types of business relationships.  Generally speaking, a business owner will refer to fellow shareholders in a corporation or member in an LLC as a “partner”.  While not technically accurate at law, use of the common descriptive vernacular appropriately identifies the nature of the relationship between business owners and the effort to apply their collective resources, skills and experience to their mutual benefit. 

Naturally, given the complexity of transactions, contracts, governance and compensation structures, business disputes can often arise.  Representation of individuals in relation to partnership and business interest and control disputes requires a unique combination of skills, knowledge and experience.  Principles of corporate governance, tax, statutory law, common law duties among business owners and general business principles converge, and the resulting conflicts are complex, personal, and emotionally charged.  The often separate worlds of litigation and transactional law collide.  

Effective representation of a shareholder/member/partner in relation to the entity and fellow business partners requires strategic legal advice from attorneys who are well versed in the key factors which are at play and the risks associated with each potential outcome.  Our commercial litigation group offers sophisticated, strategic representation and decades of collective experience in complex business transactions and disputes.  As such, our team is uniquely qualified in untangling even the most complex disputes to help you reach the most favorable result for a particular set of facts. Our attorneys will take the time to investigate the circumstances surrounding your dispute in order to protect your interests and help you avoid unnecessary risk or liability.

Should your dispute prove to be insurmountable, dissolution may be the best course of action.  We are well versed in all aspects of this process as well, and can guide you through it to ensure that assets and debts are fairly divided and your interests and rights are well protected throughout this difficult negotiation.

Shareholder/Member/Partner disputes can arise over a number of factors, including:

• Disputes over language in shareholder agreements, operating agreement, partnership agreements, and limited liability agreements

• Succession issues

• Financial disagreements, undisclosed earnings or secret dealings

• Breach of contract or fiduciary duty

• Partnership or shareholder buy-outs

• Underperformance of a partner

• Personal and managerial conflicts

• Deadlocks – where two equal partners cannot agree

• Oppressed minority shareholder disputes

• Fraud • Embezzlement

• Business disparagement

• Leaking of trade secrets

• Disclosing sensitive information

In addition, our experienced attorneys can help you or your business develop strategies to avoid or minimize future disputes.

Representative matters:

• Represented shareholders in litigation reaching resolution providing for extraction of a 50% shareholder from a multi-million dollar commercial sheet metal contractor after such shareholder sued for shareholder oppression and “freeze out”;

• Represented an entity in action for forced disassociation of a 49% percent member in multi-million dollar chemical manufacturing and distribution limited liability company triggered by the disassociating member’s alleged breach of fiduciary;

• Represented disabled shareholder in claims of oppression and breach of fiduciary duty brought by fellow shareholders based on unequal distributions and self-dealing and, subsequently, in claims brought by creditors of the entity alleging fraudulent conveyances while insolvent;

• Litigated and eventually negotiated exit of a founding partner in a physician’s practice triggered by shareholder’s purported acts and omissions exposing the practice to liabilities;

• Represented minority shareholder in claims of oppression based on the majority shareholders’ exclusion of the minority from management, access to financial information and termination of employment resulting in sale of the minority shareholder’s interest at a premium;

• Represented minority shareholder in claims for breach of fiduciary duty based on majority shareholder’s transfer of assets from jointly held entity to a separate entity owned solely by the majority shareholder in violation of the Uniform Fraudulent Transfers Act;

• Represented 49% shareholder in claim against 51% shareholder alleging fraud and misuse of corporate funds and company assets;

• Represented corporation in dissenter’s rights case;

• Appointed Receivers over the affairs of a Pennsylvania corporation by Judge Jeffrey Trauger of the Bucks County Court of Common Pleas in divorce proceeding where the multi-million dollar corporation at issue was the main marital asset, employing both parties in the divorce, and management of the entity was 
  contested;

• Appointed Receivers over the affairs of a defunct non-profit to oversee liquidation and distribution of assets including historically recognized real estate holdings;

• Represented minority shareholder in consolidating ownership of jointly held entity by acquiring secured creditor’s position and leveraging that position to induce majority shareholder guarantors to transfer ownership interests.

Antheil Maslow & MacMinn congratulates our 2019 Thomson Reuters Super Lawyer and Rising Star Attorneys. 

From our Family Law practice group, Jessica Pritchard, Elizabeth Fineman and Lisa Gaier were included.  Ms. Pritchard, Partner and department chair, was named a Super Lawyer for the fifth consecutive year, and was again included in the Top 50 Women in Pennsylvania. Rising Star Elizabeth Fineman, Partner, is being honored for the 7th time; Lisa Gaier was named a Pennsylvania Rising Star.   

Stephanie Shortall, of the firm’s Corporate/Business law department was named a Rising Star for the third consecutive year.

For more information about Super Lawyers' methodologies, visit www.SuperLawyers.com.

Business valuation can become contested in many different situations. Shareholder Agreements, Operating Agreements and Partnership Agreements often contain mechanisms for involuntary transfer upon the occurrence of any number of circumstances including but not limited to death of a shareholder, termination of employment or retirement.  In such matters, it is often in the best interest of the prospective purchaser to interpret an agreement or process set forth therein in a manner which most benefits the remaining owners and the company to the detriment of the separating owner; in other words reduce the value of the separating owner’s interest as much as possible in an effort to save money for the majority.

The language of a business agreement, if there is one, is often less than clear. If there is writing, even the clearest expression can be subject to challenge and interpretation.  Disputes in business valuation can become a battle of experts, but advocacy and leverage also play a role.  Understanding the business, the parties, the marketability of various assets, valuation methodologies and the interplay between business valuation and governance is essential to achieving the best result possible for a party.

AMM has the depth of knowledge and experience to secure appropriate evidence bearing on valuation, negotiate the resolution of a valuation dispute and, where necessary, litigate the underlying elements related to value.  

“Partnerships” are a particular species of business entity which implicate specific provisions of common law, regulation and tax which often times differ from general principles applicable to internal business disputes.  Assessment of potential liabilities in a partnership requires knowledge of the differing business partnership forms and the requirements imposed upon the owners thereof.  General partnerships, limited partnerships and limited liability partnerships implicate different statutory schemes.  Moreover, understanding and applying partnership tax law, including the calculation of capital accounts and interests, is an esoteric and complex endeavor.      

Effective representation of a business owner in relation to a partnership requires an understanding of the various partnership forms by attorneys experienced in the identification of the key factors which are at play and the risks associated with alternative approaches.  Our commercial litigation group offers sophisticated, strategic representation informed by decades of collective experience in a broad spectrum of complex business transactions and disputes including disputes related specifically to partnerships and partnership interests.  As such, our team is uniquely qualified to untangle even the most complex disputes in order to help you reach the best possible resolution under a particular set of facts.  

Should your partnership dispute prove to be insurmountable, partnership dissolution may be the best course of action.  We are well versed in all aspects of this process as well, and can guide you through it to ensure that assets and debts are fairly divided and your interests and rights are well protected throughout this difficult negotiation.

Partnership disputes can arise over a number of factors, including:

• Disputes over language in, partnership agreements, and limited liability agreements
• Succession issues
• Financial disagreements, undisclosed earnings or secret dealings
• Breach of contract or fiduciary duty
• Partnership buy-outs
• Underperformance of a partner
• Personal and managerial conflicts
• Partnership deadlocks – where two equal partners cannot agree
• Fraud • Embezzlement
• Business disparagement
• Leaking of trade secrets
• Unauthorized disclosure of  sensitive information
• Partnership accounting practices

On May 28th, Elizabeth Fineman, Partner and Family Law attorney at Antheil Maslow & MacMinn in Doylestown, will speak on “Drug & Alcohol Issues As They Apply to Custody & Support” at the Bucks County Bar Association’s Family Law Section continuing legal education seminar. Ms. Fineman will be presenting along with Hon. James J. McMaster (Bucks County Court of Common Pleas), Reb Brooks, Ed.M. (Affiliates in Psychology), and Kevin L. Hand, Esq. (Kardos, Rickles & Hand, PC). Elizabeth Fineman practices exclusively in Family Law with extensive experience in complex high net worth individuals with complex assets and tax valuation issues. The Bucks County Bar Association is one of the oldest and most active bar associations in the United States. Located in Doylestown, Pennsylvania, the Bucks County Bar Association is dedicated to providing support and fellowship for the advancement of the legal profession.

AMM Partner and Corporate Department Chair Joanne Murray was recently interviewed by Laura Queen, Founder and CEO of 29Bison Human Capital consulting firm for their podcast “How the Deal Was Done”.  In this episode, Joanne discusses the path that lead her to her business law practice, as well as her approach to the deal making process and the complexities involved.   The interview features the haunting tale of  how the ghosts of owners past and present can make an appearance at the closing table, and one such ghost who almost scared away a deal!

Joanne Murray is committed to helping small business owners achieve their goals. From inception to business maturity, Joanne serves as an experienced and insightful counselor to business owners as they face the financial, legal and operational challenges that are an inevitable part of the life cycle of a business.

Joanne helps to guide entrepreneurs and closely-held businesses through the new entity formation process and to structure, negotiate and implement business transactions such as asset and stock acquisitions, mergers, financing transactions, real estate purchases and leases, and business separations. She also assists her business and nonprofit clients with negotiating a wide range of contracts, such as software licenses, consulting agreements, employment agreements and non-disclosure agreements. She works with business owners to develop, document and implement their business succession plans, including preparing buy-sell, partnership and LLC agreements. She frequently functions as outside general counsel for companies and nonprofit entities by handling corporate record-keeping and providing advice on corporate governance and other matters as needed.

Partners Thomas Donnelly and Elizabeth Fineman of Antheil Maslow & MacMinn will speak at the third annual Business Law Institute of the Bucks County Bar Association where they will discuss business issues in divorce and family law. The seminar will take place on May 14, 2019 at the Bucks County Bar Association in Doylestown. The discussion will include business control issues, the impact of agreements among business owners on Equitable Distribution and Support, as well as remedies and valuation concerns and strategies.

Thomas Donnelly is a business and commercial litigation attorney with a focus on complex business transactions and disputes.  Elizabeth Fineman practices exclusively in Family Law with extensive experience in complex high net worth individuals with complex assets and tax valuation issues.
The Bucks County Bar Association is one of the oldest and most active bar associations in the United States. Located in Doylestown, Pennsylvania, the Bucks County Bar Association is dedicated to providing support and fellowship for the advancement of the legal profession.

Antheil Maslow & MacMinn, LLP is proud to sponsor National Alliance on Mental Illness (NAMI) Bucks County, PA's Stride for Mental Health Awareness walk.  The walk is Saturday May 18th beginning at 1 pm at Warminster Community Park, 350 E. Bristol Road, Warminster.  Funds raised support NAMI Bucks County's education and support program expansions throughout the area.  NAMI Bucks County is dedicated to raising awareness and providing support and education to end the stigma that surrounds mental health issues,  and promote recovery for individuals living with mental illness. For more information, to donate, sponsor and register, visit www.namibucksstride.org.

https://bit.ly/2V20Y3o

Antheil Maslow & MacMinn Co-founding Partner Susan Maslow received the Central Bucks Chamber of Commerce Business & Arts Award at the Chamber's 73rd Annual Celebration Luncheon on Friday, April 12th.  This is the Chamber's 23rd Business and Arts Award, which is bestowed on a business person or organization that has extended itself in support of the arts in the community.  Ms. Maslow is being recognized for her extraordinary commitment and creative dedication to the arts in Bucks County through her efforts on the many Bucks Fever Award premier events and other cultural Chamber endeavors. 

Susan Maslow is an experienced general business and transactional attorney, with a long history of service on a variety of local nonprofit boards including Big Brothers Big Sisters Bucks County, Bucks County Women's Advocacy Coalition, and Pearl S. Buck International.  She has been active on the Central Bucks Chamber of Commerce Board of Directors since 2008, and is the current Vice President of Cinema for the Bucks Fever Arts Program.