This article is part three of a series on the fiduciary duties that Minnesota business owners owe to each other and their business:
- Minnesota Business Owners Owe Fiduciary Duties
- Breach of Fiduciary Duties in Minnesota
- Dealing with a Breach of Fiduciary Duties
Dealing with a Breach of Fiduciary Duties
One of the most challenging and sensitive times, when dealing with a business owner who has breached fiduciary duties, is when you have learned about the business owner’s conduct. You often don’t know all the details, but you know enough to realize there is a problem. Do you confront the business owner? Do you talk to other business owners first? You talk to employees to ascertain what they know?
The most effective approach depends on many factors including the percentage of ownership you have in the business, the percentage of ownership of the malfeasant business owner, the type of misconduct, whether the financial consequences of the misconduct are significant, the temperaments of the parties involved, and how much you are willing to spend to protect your interest in the business.
As a business attorney who has been brought in by business owners at many stages, I can tell you that your interests are far better served by bringing in an attorney early. If the problem is small, the attorney can advise you regarding how to efficiently and inexpensively result of the problem. If the problem is large, and another business owner has caused substantial harm to you or the business, and attorney can help you identify and preserve evidence needed to win in court.
The e-mail account and computer used by a business owner can be a treasure trove of evidence to prove your case. As you know, computer data changes on a daily basis, so the quicker that you would involve an experienced business litigation attorney, the quicker you can ascertain your legal options and the related cost of those legal options.
Dealing with a breach of fiduciary duties general involves an assessment of the evidence, approaching the person who breached their fiduciary duties, and attempting a resolution without legal action. In serious cases, or when resolution cannot be attained through negotiations, decisive legal action may be necessary to protect and restore the value of the business.
Learn more about fiduciary duties of Minnesota business owners or breach of fiduciary duties in Minnesota.