The Minority Oppression Statute may only be asserted by shareholders of a closely held corporation. The term “closely held” is defined by the statute to mean corporations with less than 25 shareholders. If the corporation has more than 25 shareholders, then the shareholder may not bring a minority oppression action. Rather, the shareholder may assert derivative claims on behalf of the corporation. As described in some of my earlier blog posts, a derivative action is a claim asserted by a shareholder on behalf of the corporation.
Scott Unger is a Shareholder in Stark & Stark’s Lawrenceville, New Jersey office concentrating in Shareholder & Partner Dispute Litigation. For questions, or additional information, please contact firstname.lastname@example.org.