Often oppressed minority shareholders cannot afford the cost to retain an attorney to stand up to the oppressor. The majority shareholder will use the company’s financial resources to pay their attorney while the oppressed minority shareholder will be forced to cover their attorney fees personally. Although, Courts have discretion to award counsel fees, rarely do they award them to the oppressed.
Oppressed minority shareholder should not hesitate to ask prospective attorneys about handling their case on a contingent fee basis. Often, I agree to handle minority oppression claims with a contingency fee arrangement. Before doing so, I discuss the pros and cons of a contingency fee versus an hourly fee. Factors that should be considered are: the value of the client’s shares; whether or not the majority will litigate for a prolonged period of time; and the ability to pay legal bills during the course of the litigation. If you are an oppressed minority shareholder, you should discuss alternative fee structures such as contingency fee arrangements with your prospective attorney. I am always happy to discuss and consider a contingency. Perhaps, a contingency fee structure will give you give you the ability to stand up to the oppressor.