Resolving director claims and disputes
Business disputes often involve the directors who may also be shareholders. We understand that situations such as these can easily become inflamed which is bad for business. We work to avoid compounding difficult situations, and on finding solutions. Our experience spans acting personally for directors or for the company.
Our successfully recently resolved cases involving claims against directors include:
Consortium of shareholders
Gannons acted for a consortium of shareholders in a large recruitment firm. They were pursuing a claim against a director to recover commission fees paid to the director, which were properly owed and due to the company. We settled the claim once the company had received the fees claimed.
Defending a director who the boss didn’t like
We helped a director of a technology company on his defence to a claim brought against him for a personal motive, rather than with the interests of the company as the basis of the claim. The situation was resolved when the employer acknowledged that the director was not under performing but that his boss had taken against him. We raised claims of unfair dismissal and breach of employment contract.
The case was successfully concluded with a generous settlement agreement for the director and the buy back of his shares by the employer at a premium.
Defending a director accused of diverting profits
We advised a director of a professional services firm on a derivative claim taken against him by shareholders. It was alleged he had damaged the company’s revenue stream by directing clients to a competitor firm in which he had an indirect financial interest. Following a review of the evidence we managed to achieve an out of court deal which meant the director could walk away.
Director of a hedge fund
We have also successfully brought a derivative claim on behalf of an investor in a hedge fund. This followed a director’s breach of duty by acting in a position of conflict in managing the fund.
Non-executive director agreement
Our client was a non-executive director of an investment company. He asked us to draft the terms of his appointment to present to the board which took care of his fiduciary obligations and scoped out his role carefully.
Director’s service agreement
We helped a recruitment business with various clauses to protect the business as well as the directors including directors’ and officer insurance, indemnities, restrictive covenants and confidential information. The client also wanted to include specific bonus provisions so that manipulating profits to maximise the bonus in one year to the detriment of future years was stopped. The client knew that there is a temptation to “fix” the figures and then leave.
Protecting trade secrets and intellectual property rights
We reviewed and upgraded the protection of intellectual property clauses within the directors’ service agreement to protect trade secrets and other intellectual property rights. The director was joining with his own IP developed before the director joined the company and the employer asked us to draft the clauses required to make sure the IP became the company’s property.
Gannons think practicalities and put in place action plans