Oklahoma case law is filled with instances of both public and private corporations, limited liability companies, individuals and other entities being sued for alleged breach of fiduciary duties. Such claims often occur in the context of Shareholder Derivative lawsuits, which involve minority shareholders or members asserting claims for breach of corporate fiduciary duty by corporate officers, directors and management. Another common forum for fiduciary litigation involves Family Wills and Trusts. Oklahoma has unique laws governing lawsuits challenging the creation, interpretation and administration of Family Wills and Trusts.
A Shareholder Derivative action is brought by shareholders of a corporation (or members of limited liability company) to remedy a wrong committed against the corporation. In this type of lawsuit, the shareholders are not suing for themselves as individuals, but in a representative capacity for the corporation. Shareholders may sue on behalf of the corporation when the corporation has failed or refused to take action against its management or third parties. Recovery in such an action is for the benefit of all shareholders. One justification for such lawsuits is that they provide a means for shareholders to enforce claims of the corporation against managing officers and directors who are in control of the corporation and are not likely to authorize the corporation to bring suit against themselves. Such lawsuits frequently assert claims against corporate officers and/or directors for breach of corporate fiduciary duty, including the “duty of loyalty” and the “duty of good faith.” Examples of allegations in shareholder lawsuits include that corporate management and/or specific officers and/or directors have: improperly sold corporate assets for personal gain; improperly taken a corporate business opportunity for themselves; or improperly caused a corporation to sell assets to third parties for less than fair value.
Litigation involving Family Wills and Trusts is frequently stressful for family members who may be at odds with one another over the decedent’s estate plan. The wording of the Trust or Will may not be clear or may have an unintended or unexpected legal effects. Disputes sometimes arise if an heir is disinherited or is disappointed in receiving a smaller share than expected. A deceased relative may have been taken advantage of by a person, including an unrelated person, on whom the decedent was dependent, resulting in a legal attack against the validity of the Trust or Will. These attacks are typically on grounds that the decedent was improperly influenced or of unsound mind. Arguments also arise whether the trustee/executor is properly carrying out the purpose of the Trust or Will. There may be accusations that the trustee/executor has engaged in self-dealing for his own benefit or other improper management of estate assets. Whatever the situation, it is important to get experienced legal advice and know your rights.
Whether you are an individual, shareholder, LLC member, officer/director, family member, beneficiary, trustee, or executor, ELB lawyers Robert Edinger, Ken Blakley and Christa Sullivan have represented clients over several decades in lawsuits and disputes involving these issues and can explain your rights and, if necessary, advocate those rights through settlement, trial or appeal. If you are the aggrieved party and desire an alternative to an hourly fee arrangement, ELB lawyers have significant experience in crafting contingency fee agreements to meet our clients’ needs.