Often, a business will have multiple owners who may not always get along. Some owners may not want to expand the business quickly. Some owners may even want to take on debt to grow a business. One owner may want to spend money on advertising. Another owner may want to cautiously grow the business without debt. Similarly, some owners may want to do all the work themselves or some want to hire employees to do the work. These differences in how a business is run can often lead to conflict. The first step is to communicate among partners to see if they can come to an agreement on how to move forward. If the parties cannot work together, then eventually there is a corporate breakup or a lawsuit to dissolve the corporation and to account for the profits and losses.
What has to be done to close up a company?
The company or business must either close down and pay off all debts, or decide who is going to run the business (either one of the partners), split up the business or sell the business. The first step is figuring out what a client wants. One must also understand the financials of a business to see what makes sense for that business.
Is going to trial the best choice?
That depends on the case. Some cases need to go to a trial, but often the parties will need to try to negotiate the winding down of the business. Sometimes the debts of the business will have to be negotiated. Sometimes, the parties can benefit from mediation to resolve the situation. It can be very difficult to resolve a case via a trial when there are day to day operations to be resolved. Mediation or cooperative discussions are a good way to resolve cases.
Have you resolved business breakups?
Yes, I have helped many clients who were part owners of a business and to either get the other party or parties to buy out my client or the opposite. I have also worked to negotiate shutdowns of businesses. The challenge is that the resolution does not always happen quickly or easily. Often these cases can take months or years to resolve issues and to wrap up the business. While I have many cases that I have resolved, I can’t discuss many of them in detail due to confidentiality clauses that are in settlement agreements for my clients. This is common for parties to want to keep their business matters confidential.
