Shareholder Oppression, Fiduciary Duties
If a plaintiff in a corporation can demonstrate that there is shareholder oppression, then the plaintiff may be entitled to equitable relief. When does shareholder oppression exist?
It typically occurs when an action by the majority suggests burdensome, harsh and wrongful conduct; a lack of honesty and fair dealing in the affairs of the company; and/or a visible departure from the standards of fair dealing and a violation of fair play — which every shareholder expects when investing in a company.
Importantly, allegations of oppressive conduct are analyzed in terms of fiduciary duties owed by directors and controlling shareholders to minority shareholders. Whale Art Co. v. Docter, 743 S.W. 2d 511, 514 (Mo. Ct. App. 1987).