Your claim or the business's claim
An early question in many partner disputes is whether the harm fell on you personally or on the business. When a partner diverts an opportunity or misuses funds, the injury is often to the partnership or company itself, and in many settings that claim must be brought on its behalf, sometimes through a derivative procedure with its own requirements. Other claims, such as a denied distribution or a breached buyout promise, may belong to the individual partner. The distinction affects who can sue, what must be shown before filing, and who receives any recovery. LLC operating agreements and limited partnership agreements often address these points, and their wording matters.
Keeping the business running
Litigation between owners can paralyze decisions, unsettle employees, and worry lenders and customers. Courts can grant interim relief in appropriate cases, such as orders preserving assets or access to records, and in serious situations a receiver or other neutral may be appointed. Both sides should continue performing ordinary duties and avoid self-help, such as changing locks, moving funds, or cutting off a partner's access, without advice. Gather the partnership or operating agreement, financial statements, bank records, tax returns, and correspondence about the disputed decisions. If you are being kept out of the books, keep a record of your written requests and the answers you receive.
Responding to a partner's suit
A partner who has just been served should treat the response deadline as close at hand, and should check early whether the agreement sends the dispute to arbitration or a particular court. We review the complaint against the agreement to identify defenses, possible counterclaims, and whether insurance or indemnification from the entity may cover defense costs. We discuss whether a negotiated buyout or separation is realistic, since many partnership lawsuits end with one side leaving the business. Throughout, we focus on protecting your interest in the business while the dispute moves forward.
