“Because Wallace and Joan have not authorized dividend distributions, Martin has received no financial benefit from his minority interest in E&E. Meanwhile, Wallace has approved his own annual compensation in the millions of dollars.” Smith v. Smith, 2020 U.S. Dist. LEXIS 81240, *3 (E.D. Mich. May 8, 2020). The Smith case, pending in the U.S.…
Continue reading ›A non-public corporation is a corporation that has no shares listed on a national securities exchange or regularly traded in a market maintained by one or members of a national or affiliated securities association. In a shareholder action in a non-public corporation, circuit courts may order one of several remedies listed in Section 12.56 of…
Continue reading ›Section 12.30 of the Illinois Business Corporation Act of 1983 (“Act”) (805 ILCS 5/12.30) explains the effects of corporate dissolution. Section 12.75 of the Act (805 ILCS 5/12.75) details the notice requirements a dissolved corporation must comply with in order to remove its liabilities. These sections of the Act give shareholders expectation guidelines following their…
Continue reading ›In a shareholder action against a co-shareholder (co-owners or incorporated business partners, colloquially), a court may order one of the remedies provided for in 805 ILCS 5/12.56(b) if the shareholder shows that “the directors or those in control of the corporation have acted, are acting, or will act in a manner that is illegal, oppressive,…
Continue reading ›Illinois law offers a number of remedies for closely held or private corporation shareholders trapped in toxic or dysfunctional relationships with their corporations or fellow shareholders (co-owners). Given the structure of most corporations, 50/50 shareholders and minority shareholders are the most apt to find themselves in these situations. Section 12.56 of the Illinois Business Corporations…
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