Practice

Corporate disputes

Defence in conflicts between partners, assets removed from control, challenges to decisions of governing bodies: we act for the party whose rights have been violated.

Service

What the service includes

A corporate dispute rarely begins in court. It is usually the end point of a long conflict between partners: unapproved transactions, blocked decisions, attempts to strip assets or dilute a stake. By the time the matter reaches court, the parties’ positions are normally firmly entrenched.

We handle disputes at any stage, from pre-trial negotiations and interim measures to court proceedings and enforcement of the judgment. First of all, we get to grips with the real structure of the conflict, not only the formal claims.

A practical question often has to be solved in parallel with the corporate dispute: how to keep the company’s operations running while the proceedings are under way. We run both tracks at once. We prepare the position for court and make sure the opponent cannot block the bank account, shipments or access to day-to-day management through parallel claims. If the conflict is rooted in asset stripping, we separately work on freezing orders and interim measures over the property itself, not only over the stake in the company.

What the service includes:

Disputes between partners Challenging decisions of governing bodies Removal of a participant from an LLC Interim measures over assets Protection against dilution of a stake
Clients

Who it is for

The situations clients most often bring to us on this topic.

A partner blocks decisions by abusing a veto right One of the founders strips assets ahead of a split of the business A minority participant is denied information and access to the company’s documents The heirs of a participant come into conflict with the remaining partners
Service

How we work

A fixed fee and a clear plan of action, agreed before work begins. The timeframes below are indicative and depend on the complexity of the case.

I

Recording the situation

We collect and analyse the company’s documents (articles of association, minutes, contracts) to understand the real picture of the conflict. Timeframe: 2-5 days.

II

Interim measures

Where necessary, we act quickly to obtain a freeze on assets or an order prohibiting certain actions while the asset has not yet been removed. Timeframe: 1-3 days (in urgent cases).

III

Negotiation or court

We try to settle the conflict through negotiation if that is in the client’s interests, or move to court proceedings. Timeframe: from 2 weeks.

IV

Enforcement of the judgment

We see the case through to an actual result: restored control, recovered compensation or an enforced judgment. Timeframe: 1-6 months.

Documents

What you will need at the start

We confirm the exact list for your situation at the consultation. This is a guide so that you arrive at the first meeting prepared.

The company’s articles of association and founders’ agreement Minutes of general meetings of participants Share purchase agreement (if any) Correspondence with the partner on the disputed issue Financial statements for the disputed period
Practice

Key figures

Experience in this practice area specifically, not in practice as a whole.

65% of disputes are resolved before trial Negotiations and interim measures at the preparation stage resolve some conflicts without court proceedings.
48 hours to file for interim measures Speed is especially critical where there is a risk of assets being removed or the company’s accounts being blocked.
4 court instances in complex disputes Some cases reach cassation and the Supreme Court, and we prepare the position with that in mind from the outset.
30+ corporate conflicts handled From disputes between two founders to conflicts in companies with a dispersed ownership structure.
$2 million largest amount of contested asset stripping The transaction was declared invalid and the asset was returned under the control of the injured partner.
90% of cases decided in the client’s favour This figure covers disputes in which the firm is engaged at the preparation stage, not after the event.
Practice

Common mistakes

Letting the conflict drag on without documenting breaches. Participants build up mutual claims verbally for years without recording breaches in writing, and when the matter reaches court they can prove neither the timing nor the breach itself, because of carelessly drawn-up minutes and correspondence.

Relying on informal arrangements with a partner. Founders rely for years on oral agreements about roles and profit, and when the relationship deteriorates it turns out that the articles of association and the shareholders’ agreement do not reflect those arrangements at all, leaving nothing formal to protect their interests.

Ignoring the risk of subsidiary liability. A director keeps taking decisions at the height of a corporate conflict without assessing that, if the company becomes bankrupt, those decisions may be recharacterised as grounds for their personal subsidiary liability.

Result

What you get

A documented body of evidence. All of the partner’s breaches are documented and ready for use in court or in negotiations.

Assets protected by interim measures. Property and shares are frozen against further removal for the duration of the proceedings.

A legal position for court or a deal. A strategy is ready for litigation or for a buyout of the stake on favourable terms.

Control over the company’s operations. The business keeps running while the corporate conflict is resolved.

FAQ

Frequently asked questions

What should I do if a partner blocks the company’s decisions?+

It depends on the articles of association. Sometimes procedural mechanisms are enough, and sometimes court action is needed. We review your specific situation at the consultation.

Can a bad-faith participant be removed from an LLC?+

Yes, through the court, if it is proved that their actions cause substantial harm to the company or make its operations impossible.

How quickly can assets that are being removed be frozen?+

Where there are grounds, the court can consider an application for interim measures within a few days.

How long does a corporate dispute take on average?+

From a few months for a straightforward dispute to 1-2 years if the case goes through several court instances.

Can a board of directors’ decision be blocked until the dispute is heard on the merits?+

Yes. In the course of the dispute you can apply for interim measures, for example a ban on implementing the contested decision or on making changes to the USRLE, until the court has examined the case.

What should I do if a partner blocks the company’s operations but does not leave the business?+

This situation is known as a corporate deadlock. We assess whether there are grounds for the compulsory removal of the participant through the court, or whether it is more advantageous to buy out their share under a previously agreed mechanism.