Business Divorce Disputes

Thursday, June 28, 2018

Tip 3: Discuss the hard topics before you get started

This is part 3 in our series of tips for new business ventures and investments. In Tip 1, we discussed the disadvantages of using standard form documents. Tip 2 covered why you need an attorney to represent you individually instead of a single lawyer for the group of investors.

Tip 3 is more practical than legal. If you page through the form documents of your company, you will see pages devoted to topics of little relevance to the practical challenges that can face a new business. You might find two pages devoted to the requirements for properly noticing and conducting an annual meeting of shareholders and perhaps two sentences on what happens if the business needs more capital or faces a dispute among the owners.


Read more . . .


Friday, March 30, 2018

Tip 2: Hiring an Attorney for You – Not the Group


This is part 2 in our series of tips for new investments. In part one; we discussed the disadvantages of using standard form documents to govern the new investment or business. Now in tip #2, we are going to talk about the role of attorneys in the process.

The disadvantage of hiring one attorney to represent a group of investors.

Attorneys are supposed to represent the client that hired them and give that client their devotion and loyal advice.


Read more . . .


Tuesday, December 12, 2017

Can't get information from the LLC or LP you invested in? Texas Legislature gives you the right to attorney's fees.


If you invest in ownership in a Texas corporation, limited liability company ("LLC") or Texas limited partnership ("LP"), and get shut out or suspect some act of mismanagement, the right under the Texas Business Organizations Code to ask for documents is an essential protection.

But until the 2017 Texas legislative session, if the business refused an owner’s demand for documents, only a shareholder in a corporation could seek recovery of attorney's fees and other expenses for having to go to Court to force the entity to turn over documents, while LLC and LP investors had no right to attorney’s fees.

In 2017, the Texas legislature leveled the playing field by amending the Texas Business Organizations Code to allow both LLC members and limited partners to recover attorney's fees when the business refused to give them documents. Given the increasing use of LLC and LPs for newly formed private companies, this is a much-needed protection.


Read more . . .


Monday, September 11, 2017

Family Law Post (Part II) - What's Love Got To Do With It: The Business, Financial and Other Benefits Of A Marital Pre-Nup

Couples often spend months planning their wedding day details, from the color of the flowers to the icing on the cake.  What they often overlook, however, are the legal rules that will govern their property once they are married.  While the topic lacks romance, couples should seriously consider the benefits of entering into a pre-nuptial agreement, which will impact them, and potentially their children, far beyond their wedding day.

This is the second in a two-part series focusing on pre-marital agreements, or pre-nups. Part 1 considered how a pre-nup can help a couple address a number of crucial financial and personal issues.


Read more . . .


Monday, August 21, 2017

Family Law Post (Part 1) - Love Is Forever, But A Pre-Nup May Be The Better Bet: The Financial And Other Benefits Of A Marital Pre-Nup

Not so long ago, marital pre-nups were viewed as devices solely for use by the rich and famous, who never seemed to stay married for long.  In today’s world, however, couples from all walks of life face a myriad of important financial and personal issues that a pre-nup can help them to address.  Pre-nups can benefit both spouses, including by:

  • Preventing costly, drawn out divorce litigation;
  • Protecting a spouse’s interests in a business;
  • Preserving valuable family assets, real property and heirlooms;
  • Assuring the inheritance rights of spouses and children;
  • Shielding one spouse or children from creditors; and
  • Giving peace of mind to the couple by reducing uncertainty about the impact of major life events in the future.

This is a two-part Post focusing on marital pre-nups.  Part 1 evaluates how a pre-nup can address important critical business and family issues for the couple.


Read more . . .


Tuesday, May 23, 2017

Shareholder Derivative Claims: The Sharp Arrow in the Quiver Still Available to Minority Shareholders In Texas Private Companies

Based on our personal experience handling Business Divorce matters for both majority owners and substantial minority investors in private companies, we have learned firsthand that there are two sides to every story and every Business Divorce matter is unique.


Read more . . .


Tuesday, March 28, 2017

Buy-Sell Agreements: Don’t Leave Home (Or Invest) in a Private Company Without One

The season finale of the hit reality TV show The Bachelor attracted more than 8 million viewers. My wife and teenage daughters help make up this devoted fan base, and watch every episode. Yet, when I question them about whether the subject of a pre-nup agreement has ever come up on the show, I get eye rolls, and comments like, “Dad, don’t be such a downer.”  Assuming that the Bachelor and his new fiancé do make it to the altar, however, the show also does not mention that


Read more . . .


Monday, February 27, 2017

What Is A Texas Partnership: The Answer To Come Soon In The Case Of ETP v. Enterprise Products Partners LP

The legal tension is building.  Private Texas companies and their owners are awaiting a court decision that may force them to say “Howdy, Partner” to companies with whom they have no written partnership agreement. The case on which business eyes are focused is ETP v. Enterprise Products Partners, which is before the Dallas Court of Appeals after a jury awarded $535 million in early 2014.  The case has been described as a corporate form of common law marriage to a company that the jury determined was jilted in favor of another. This is the hottest partnership case the Lone Star State has seen in years.

The Disputed Partnership at the Heart of the Case

Energy Transfer Partners LP (“ETP”) alleges that it formed a statutory (unwritten) partnership with Enterprise Products Partners LP (“Enterprise”) to build a crude oil pipeline that would carry oil from Cushing, Oklahoma to the Gulf of Mexico. Enterprise contended that no partnership arose because the boards of the companies never signed a definitive agreement. ETP countered that the actions of the companies confirmed their intent to work as partners and that their conduct met the five-factor test for determining partnership in the Texas Business Organizations Code.



Read more . . .


Friday, February 10, 2017

Virtual Reality Goes To Court: Lessons Learned From The $500 Million Jury Verdict Against Facebook’s Oculus Division

The ink is barely dry on the half billion dollar verdict that a Dallas federal court jury returned last week for ZeniMax Media against Oculus, a virtual reality company that Facebook acquired in May 2014. Even before the federal court issues a final judgment and Oculus files an inevitable appeal, however, the case provides valuable lessons for business owners and investors.


Read more . . .


Monday, December 12, 2016

A Look Back at 2016 – Legal Issues Affecting Texas Private Company Owners and Investors (Part 1)

A sure sign the year is winding up is the release of A sure sign the year is winding up is the release of TIME magazine’s “Person of the Year” list.  If TIME created a similar list of legal developments impacting owners and investors in private Texas companies this past year, at least two issues would be on it: the adoption of the Defend Trade Secrets Act and the stalemate that continues to exist for minority shareholders who have claims for oppression against majority owners.  The legal restrictions on the oppression claim have spurred an increase in shareholder derivative lawsuits containing allegations that private company officers and directors breached their fiduciary duties to the business.


Read more . . .


Monday, November 21, 2016

The Devil You Know: Pick Business Partners Wisely and Plan For Problems Ahead

Picking the devil you know in selecting a business partner may seem like a good strategy.  But the list of celebrities who have suffered financially in their dealings with business partners is striking with losses totaling millions of dollars in some cases.  Uma Thurman lost $1 million. Sting lost $9.8 million. Billy Joel lost $90 million.  And celebrities are not the only ones who have suffered negative results because they, like so many people, picked poor business partners.  Fortunately, there are steps that anyone entering into a long-term relationship with a business partner can take to avoid the financial consequences of a disastrous partnership.


Read more . . .


Archived Posts

2018
2017
2016
December
November
October
September
August
July
June
May
April
March
February
January
2015
December
November
October
September
August
July
June
May
April
March
February
January
2014
2013

← Newer12 3 4 5 Older →


With offices in Houston and Dallas, Diamond McCarthy LLP assists a variety of clients with their Texas Business Divorce matters throughout Texas, including Austin, San Antonio, Midland, Fort Worth, Galveston, Amarillo, Abilene, and Waco.



© 2019 Diamond McCarthy LLP | Disclaimer
2711 N. Haskell Avenue, Suite 3100, Dallas, TX 75204
| Phone: 214-389-5300
909 Fannin Street, 37th Floor, Houston, TX 77010
| Phone: 713-333-5100

Meet the Team | What you Need to Know | Practice Areas | About

Legal Web Development by
Zola Creative


Business Dispute News

The information provided on this site is not legal advice, and is not intended to be legal advice. You should consult an attorney for advice regarding your individual situation. The decision to hire an attorney is an important decision, and should not be based solely on advertising. We welcome your calls, letters and electronic mail, but contacting us does not create an attorney-client relationship. All attorney-client relationships that are formed with our law firm will be documented in a signed, written agreement. Please do not send any confidential information to us until an attorney-client relationship has been established.

Our prior results in other cases do not guarantee a similar outcome in a future case. The results we have obtained for our clients depend on a variety of factors that are unique to each representation and each set of facts.