Shareholder Disputes & Governance

Business disputes among partners, shareholders, managers, or others (particularly in closely held companies), can be life-altering for key stakeholders, and can preserve or destroy a business.

An equity interest in a private business is often an owner’s primary financial asset, and the resolution of an ownership dispute may significantly affect the owner’s financial future. Sometimes ownership and control are themselves on the table—with parties at risk of losing the benefit of their long term personal and professional contributions to the business that they helped build.

A competitive advantage

Many law firms treat these disputes as strictly litigation matters. At Tonkon Torp, we take a more holistic approach. Depending on the facts at issue, our business lawyers may lead a team committed to resolving the problem, with litigation used as one of many tools available to achieve a positive outcome. The ultimate resolution of a shareholder dispute often involves a business transaction. When they can add value to the project team, we will bring in a tax lawyer, a corporate expert, a commercial contract lawyer, a mergers and acquisitions professional, or other lawyers in our business department to develop the best structure to resolve a dispute. The structure of our firm lends itself to seamless team collaboration because our practice is integrated across departments and practice groups. We have long understood that an interdisciplinary approach better meets our clients’ goals, putting our attorneys in a better position to resolve disputes among business owners efficiently and successfully. Recent examples of our successful approach include matters in which:

  • We assisted the minority owners of a professional services business in taking control of the company from the majority owner in arbitration by bringing Oregon statutory claims while negotiating contract and valuation issues.
  • We simultaneously favorably resolved IRS and foreclosure issues for family shareholders in the middle of a multi-year business sale dispute. We then obtained a multi-million dollar settlement for our clients – impossible to achieve without primary contributions by our litigation, tax, M&A transaction, and real estate lawyers.
  • We worked with the former President of a private-equity backed business services company to negotiate equity valuation procedures, and manage and present an equity valuation conclusion, resulting in an increase in his equity valuation redemption payout from $0, as proposed by the controlling owner, to over $8 million. This outcome was achieved through substantial reliance on our corporate finance expertise.
  • We supported the founder and minority owner of a local, closely held technology company in a contested valuation and buyout proceeding resulting in an increase in her equity redemption payment of more than $1.5 million, a result substantially dependent on the corporate and corporate finance expertise of the business attorneys on our client team.
  • We assisted the majority partners in a local professional services firm in negotiating their withdrawal from their partnership and establishing their own leading practice with their long-time clients.
  • We protected the majority owners of a manufacturing company from a minority shareholder who refused to redeem minority shares under a shareholder agreement, resulting in an award to our clients of specific performance, a new share valuation, and significant attorney fees.
  • We helped a majority member of an LLC wrest back control of a large recycling outfit after a minority member took illegitimate steps to lock the majority member out of the business. We helped by finalizing an unfinished business transaction and cleaning up corporate record-keeping prior to arbitration.
  • We assisted a company in redeeming its former CEO’s shares after a dispute over valuation by leveraging Oregon’s dissenters’ rights statutes and petitioning the court for a judicial appraisal, resulting in a reasonable parting of ways.
  • We leveraged a cash-out merger, coupled with breach of fiduciary duties claims, to motivate a former chief executive officer and minority shareholder of a closely held technology company to surrender his ownership interest in exchange for a release of claims and small redemption payment.
  • We provided counsel to the board of directors of a closely held business that enabled it to preserve its business operations and continue to grow in the midst of a dispute among the shareholders of the business.
  • In a case involving Delaware, Florida, and Oregon law, we assisted a minority owner of a highly-successful startup in securing a substantial, favorable settlement after the majority owners attempted to freeze him out of the benefits of a merger.

Maximized value

Collaboration isn’t just about achieving favorable financial settlements – it can also decrease the length and cost of the dispute. Adding appropriate business, corporate and financial knowledge to a dispute brings a different perspective, which can lead to creative solutions not considered in pure litigation. Our approach often saves our clients time and money, and may also reduce conflict and preserve relationships. We are cognizant of how costly contesting a business breakup or other ownership dispute can be. We work with our clients to provide options that allow them to pursue their best course of action, without being controlled by immediate cost. These options may include a modified or contingent fee structure aligned to the detail of a client’s dispute and available resources, with full payment made upon an equity purchase or other liquidity event.

Alternatives to litigation

Our team approach to business breakups can also result in less litigation. Business breakups can be emotionally charged, which often adds motivation for the parties to have their day in court. While we support courtroom solutions when needed, we begin our work with an astute interpretation of the situation, employing the collective knowledge of our blended litigation/business legal team to assess and recommend all available alternatives. We do not treat lengthy, expensive, and uncertain litigation as the de facto course of action.

Client-focused solutions

For a client involved in a business breakup, our blended teams keep one overarching goal in mind—what are the most efficient means to achieve the client’s goals? More than anything else, this approach keeps our work streamlined and keeps the focus on the client and their legal and business options during a critical period in their business lives.

Partner
Adam
Adkin
503.802.2187
adam.adkin@tonkon.com
Partner
Rachel
Atchison
503.802.5732
rachel.atchison@tonkon.com
Associate
Carlie
Bacon
503.802.2190
carlie.bacon@tonkon.com
Associate
Paul
Balmer
503.802.5745
paul.balmer@tonkon.com
Partner
Eric
Beach
503.802.2182
eric.beach@tonkon.com
Associate
Lauren
Bernton
503.802.2144
lauren.bernton@tonkon.com
Partner
Owen
Blank
503.802.2011
owen.blank@tonkon.com
3499, 3523
Partner
Ryan
Bledsoe
503.802.2120
ryan.bledsoe@tonkon.com
Partner
Jeff
Bradford
503.802.5724
jeff.bradford@tonkon.com
3505
Partner
Kristin
Bremer Moore
503.802.2154
kristin.bremer@tonkon.com
3561
Partner
Claire
Brown
503.802.5731
claire.brown@tonkon.com
Partner
Bob
Carey
503.802.2032
bob.carey@tonkon.com
3423, 3537, 3572
Partner
Paul
Conable
503.802.2188
paul.conable@tonkon.com
Associate
Sadie
Concepción
503.802.5773
sadie.concepcion@tonkon.com
3493
Partner
Timothy
Conway
503.802.2027
tim.conway@tonkon.com
3491, 3559
Partner
Sherrill
Corbett
503.802.2049
sherrill.corbett@tonkon.com
Associate
Timothy
Costello
503.802.2193
timothy.costello@tonkon.com
Partner
Clay
Creps
503.802.2059
clay.creps@tonkon.com
3501, 3569, 3495, 3574
Partner
Jeffrey
Cronn
503.802.2048
jeff.cronn@tonkon.com
Partner
Rocky
Dallum
503.802.2175
rocky.dallum@tonkon.com
Associate
Sam
DeBaltzo
503.802.5772
sam.debaltzo@tonkon.com
Partner
Justin
Denton
503.802.2117
justin.denton@tonkon.com
3531
Partner
Christopher
Erickson
503.802.2177
chris.erickson@tonkon.com
Partner
Michael
Fletcher
503.802.2169
michael.fletcher@tonkon.com
Partner
David
Forman
503.802.2023
david.forman@tonkon.com
3462
Of Counsel
Danica
Foster
503.802.2160
danica.foster@tonkon.com
3543
Associate
Will
Gent
503.802.5767
will.gent@tonkon.com
Associate
Olivia
Godt
503.802.2158
olivia.godt@tonkon.com
Associate
Stephanie
Grant
503.802.5736
stephanie.grant@tonkon.com
Partner
Ronald
Greenman
503.802.2006
ron.greenman@tonkon.com
3567
Partner
Gwendolyn
Griffith
503.802.2102
gwen.griffith@tonkon.com
3572, 3529
Partner
Drew
Hagedorn
503.802.5757
drew.hagedorn@tonkon.com
Associate
Mick
Harris
503.802.5765
mick.harris@tonkon.com
3535
Partner
Caroline
Harris Crowne
503.802.2056
caroline.harris.crowne@tonkon.com
Partner
James
Hein
503.802.2129
james.hein@tonkon.com
3447
Partner
Ted
Herzog
503.802.2033
ted.herzog@tonkon.com
Partner
Karen
Hobson
503.802.2136
karen.hobson@tonkon.com
Associate
Jarell
Hunt
503.802.5776
jarell.hunt@tonkon.com
Associate
Josie
Jeremiah
503.802.2146
josie.jeremiah@tonkon.com
Associate
Jordan
Jeter
503.802.2076
jordan.jeter@tonkon.com
Partner
Jeffrey
Keeney
503.802.2025
jeff.keeney@tonkon.com
3493
Partner
Albert
Kennedy
503.802.2013
al.kennedy@tonkon.com
Partner
Blerina
Kotori
503.802.2055
blerina.kotori@tonkon.com
Associate
Antonija
Krizanac
503.802.2038
antonija.krizanac@tonkon.com
Partner
Melina
LaMorticella
503.802.2122
melina.lamorticella@tonkon.com
Partner
Mark
LeRoux
503.802.2022
mark.leroux@tonkon.com
Of Counsel
Maureen
McGee
503.802.5726
maureen.mcgee@tonkon.com
Associate
Harlan
Mechling
503.802.5733
harlan.mechling@tonkon.com
3503
Partner
Parna
Mehrbani
503.802.2170
parna.mehrbani@tonkon.com
3497
Partner
Brenda
Meltebeke
503.802.2088
brenda.meltebeke@tonkon.com
3569
Partner
Michael
Millender
503.802.2164
michael.millender@tonkon.com
Partner
Max
Miller Jr.
503.802.2030
max.miller@tonkon.com
Partner
Christopher
Morehead
503.802.2035
christopher.morehead@tonkon.com
3525
Partner
Jessica
Morgan
503.802.2165
jessica.morgan@tonkon.com
Partner
Haley
Morrison
503.802.2121
haley.morrison@tonkon.com
Associate
Gracey
Nagle
503.802.5753
gracey.nagle@tonkon.com
3519
Senior Counsel
Janet
Neuman
503.802.5722
janet.neuman@tonkon.com
Associate
Danny
Newman
503.802.2089
danny.newman@tonkon.com
3511
Senior Counsel
Darcy
Norville
503.802.2036
darcy.norville@tonkon.com
Attorney
Steven
Olson
503.802.2159
steven.olson@tonkon.com
Partner
Turid
Owren
503.802.2045
turid.owren@tonkon.com
3525
Partner
Christopher
Pallanch
503.802.2104
christopher.pallanch@tonkon.com
Partner
Thomas
Palmer
503.802.2018
tom.palmer@tonkon.com
3509
Partner
Alan
Perkins
503.802.2127
alan.perkins@tonkon.com
3563, 3513
Partner
David
Petersen
503.802.2054
david.petersen@tonkon.com
Associate
Megan
Reuther
503.802.2174
megan.reuther@tonkon.com
3521
Partner
John
Rosenfeld
503.802.2010
john.rosenfeld@tonkon.com
Associate
Kate
Roth
503.802.2189
kate.roth@tonkon.com
Associate
Ferdinand
Ruplin
503.802.2029
ferdie.ruplin@tonkon.com
Managing Partner
Kurt
Ruttum
503.802.2043
kurt.ruttum@tonkon.com
Partner
Melany
Savitt
503.802.2179
melany.savitt@tonkon.com
Partner
Drea
Schmidt
503.802.5703
drea.schmidt@tonkon.com
Partner
Ava
Schoen
503.802.2143
ava.schoen@tonkon.com
3515
Partner
Jeanette
Schuster
503.802.2114
jeanette.schuster@tonkon.com
Of Counsel
Leon
Simson
503.802.2067
leon.simson@tonkon.com
3423, 3553
Partner
Dan
Skerritt
503.802.2024
dan.skerritt@tonkon.com
Partner
Josh
Smith
503.802.2191
josh.smith@tonkon.com
3574, 3545, 3547, 3555
Partner
Anna
Sortun
503.802.2107
anna.sortun@tonkon.com
Partner
Kimberlee
Stafford
503.802.2062
kimberlee.stafford@tonkon.com
Of Counsel
Darian
Stanford
503.802.2028
darian.stanford@tonkon.com
Partner
Jon
Stride
503.802.2034
jon.stride@tonkon.com
Associate
Samantha
Taylor
503.802.2042
samantha.taylor@tonkon.com
3462
Partner
Alex
Tinker
503.802.5734
alex.tinker@tonkon.com
Partner
Joseph
Voboril
503.802.2009
joe.voboril@tonkon.com
Associate
Alexandria
Wagner-Jakubiak
503.802.5748
alexandria.wagner@tonkon.com
Partner
Frank
Weiss
503.802.2051
frank.weiss@tonkon.com
3503, 3539, 3541, 3545, 3547, 3551
Partner
Steven
Wilker
503.802.2040
steven.wilker@tonkon.com
Partner
Michael
Willes
503.802.5737
michael.willes@tonkon.com
3491, 3559
Partner
Jeffrey
Woodcox
503.802.2039
jeffrey.woodcox@tonkon.com
Associate
Timothy
Wright
503.802.2052
timothy.wright@tonkon.com
Partner
Zachary
Wright
503.802.2041
zach.wright@tonkon.com

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