AboutA. Hall, Minnesota Attorney Expertise As a licensed Minnesota attorney, I can answer questions involving Minnesota law in the following areas: business ownership issues, forming a business, contracts, employment, securities, copyrights, trademarks, patents, licensing, trade secrets, unfair trade practices, shareholder disputes, tax law, M&A, corporate law, general business law, and resolving disputes through negotiation, arbitration, or litigation. I can provide general information for these topics in geographic locations outside Minnesota.
Experience Aaron Hall is a licensed attorney, admitted to practice law in Minnesota state courts and the U.S. Federal District Court in Minnesota.
Aaron Hall's experience includes service at the law firms of Fredrikson & Byron, Morrison Fenske & Sund, Foley & Mansfield, and Henningson & Snoxell. Aaron Hall also served as a judicial extern under the Honorable Paul A. Magnuson, United States District Court Judge, and as an adjunct professor at Concordia University teaching Introduction to Business Law, Business Law for Marketing Professionals, and Internet Law for Marketing Professionals courses.
Aaron served in a variety of appointed positions for city, county, and state government entities, including the Burnsville City Board of Appeals, the 35W Solutions Alliance, the Minnesota Department of Revenue Property Tax Assessment and Classification Reform Study Group, and the Heart of the City Steering Committee. In 2007, the Minnesota Justice Foundation recognized Aaron for providing over 200 hours of pro bono legal services during the year.
Organizations American Bar Association
Minnesota Bar Association
Hennepin County Bar Association
Minnesota Small Business
Publications Associated Press, Star Tribune, Pioneer Press, Duluth News Tribune, William Mitchell Law Review
Education/Credentials Aaron was awarded his Juris Doctor degree cum laude from William Mitchell College of Law, where he served on the William Mitchell Law Review. He was recognized on the Deans List for outstanding academics and received the CALI Awards of Excellence in Corporations and Alternative Dispute Resolutions courses. Aaron served as President of the Business Law Society and coordinated the establishment of the Corporate Appellate Law Moot Court. He was awarded his Bachelor of Arts degree in Marketing Management and Innovation summa cum laude from Concordia University in St. Paul, Minnesota.
Awards and Honors Ten Outstanding Minnesotans, Minnesota Jaycees
Question I, 20%, started a company with 2 partners in April 2000. Despite the fact that we were a fairly profitable company almost from the start, my one partner, 40%, decided to fire my other partner, 40%, after some health problems.
Though it states in our shareholders agreement none of us could fired unless we committed some sort of felony or defrauded the company or one of it's suppliers, my partner was so adimate about getting rid of our other partner he practically forced him to sell his shares, after repeated threats of termination, at an agreed upon price that myself and my remaining partner were to pay over a period of 30 months.
The partner who sold his shares was never terminated during the negotiations, nor were his benefits, health insurance, cut, because I wouldn't let my partner do what he wanted, despite the fact of what the shareholder's agreement said.
Things went along fairly well for the next two years until my partner, 60%, decided he wanted me, 40%, gone. In November of 2006, he wrote me up for things he could not prove and even accused me of doing drugs at work, which I immediately denied at our corporate attorneys office during a meeting. I immediately volunteered to take a drug test, but they said that was not necessary.
Despite that I took drug tests at a nearby screening office and had the results sent to my partner. After about 3 weeks of tests my partner told me I didn't need to continue with testing it had been a misunderstanding, that was December of 2006.
January of 2007 I was told to take some of my accumulated vacation, so I could recuperate from a broken fibula I suffered at work in November 2006.
After two weeks off my partner called a meeting at our accountants office and was informed of his plan to buy me out. They also tried to repay a loan to the company I made, for payroll and other corporate expenses, for $40,000, with a check for approximately $24,000, I said no thanks, I wanted the loan paid back in full.
He continued to pay my salary for a while until one day in March of 2007, he sent a private investigator to my home with a letter of termination.
Upon my termination, my salary was discontinued as well as my health insurance.
It has been about a year and a half and nothing has been resolved. I have changed Lawyers in the hope of getting something accomplished, but still nothing.
My new attorney says my partner is crying he doesn't have money for a buyout now, despite the fact that there was plenty of monies early on, but I was going to be forced to take their offer, NO NEGOTIATING, kind of take it or leave it.
If we can't reach an agreement, and he may go out of business, because of his poor handling of day to day operations, what recourses do I have now, and what can I do if he does go out of business later. Go after him personally?
As far as piercing the corporate veil that was done long ago by paying his and his families personal expenses on an ongoing basis with corporate monies of which 40% are still mine.
Answer Answering your question poses a couple challenges:
First, you mentioned that you have already hired an attorney for this matter. Your attorney understands the law in your jurisdiction and has a better understanding of the facts than I would. Also, I do not know what jurisdiction you are in. Obviously, your attorney is in a better position to provide you guidance than me.
Second, there are a number of complicated legal issues raised by your situation. Additional facts would be required to identify your options.
Despite these challenges, I will provide general information about your ultimate question. Your writing concluded with this question, "What recourses do I have now, and what can I do if he does go out of business later. Go after him personally?"
Yes, generally a person can recover against a partner personally for the partner's wrongful acts. In general, a person is always liable for their own conduct. No corporation, LLC, or other limited liability business type shields a person from being liable for their own wrongful conduct. (While a principal may indemnify an agent, the agent is generally still liable if the principal is insolvent. Exceptions apply when wrongful conduct is within the scope of the employment/agency.)
As for the second part of your question, I cannot explain your legal options due to the complexity of your situation, not knowing your state's law, and the fact that you already have an attorney. I recommend you follow the advice of a competent business attorney in your state.
