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Partnership Dispute Resolution

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Negotiation, Mediation, Arbitration, Litigation

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We’re Experts in Partnership, Closely-Held Corporation, and Limited Liability Company Disputes

When partnerships go bad, there are usually winners and losers, and this should serve as a reminder that business relationships involve risks that can and should be mitigated with thoughtful planning. It also means that before you enter into any sort of business entity, you should write and sign a contract laying out the terms of that relationship. Note that what applies to partnerships is valid as well for other types of closely held businesses – including limited liability companies (LLCs) and corporations – in which individual personalities can have significant influence on business outcomes.

A well-drafted partnership/membership/ownership agreement should spell out how you and your partner(s) will run your business, and it should provide mechanisms to avoid intra-company disputes before they begin. It should outline expected behaviors (e.g., governing use of company assets and outlining fiduciary duties) and provide sensible pathways for resolving disputes.

California Cannabis Claims Breach of Fiduciary Duty

Some Common Issues

Common issues include: What should be the process for making capital contributions, if required? Or distributing profits? Does the company use intellectual property belonging to one of the company owners, and if so, is it using that intellectual property under license? If the owner of the intellectual property leaves the company, does the company have protected usage rights for a certain period? And if a company owner leaves the company, what constraints, if any, are there on his or her ability to compete against the company?

In highly regulated industries, such as cannabis, there may be legal requirements to disclose all participating members and sources of financing to regulators, and the question of who holds particular licenses to conduct business can be a significant issue to the functioning of a partnership. In some countries, an owner leaving the business must be reported to governmental authorities and that can even impact the ability of the company to continue its operations.

Common litigation issues include injunctive relief, breach of fiduciary duty, shareholder oppression, misappropriation, waste, commercial disparagement, fraud, shareholder rights and derivative actions, non-disclosure agreements, conversion, expulsion, the business judgement rule, and breach of contract.

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Strong Contracts Are Key

If you do find yourself in a partnership or other intra-company dispute, a thoughtfully drafted contract will take you a long way toward a relatively inexpensive and favorable resolution via negotiation, mediation, or arbitration, with litigation usually the last resort.

Having successfully resolved hundreds of civil and commercial disputes around the world, we know that strong contracts are key when it comes to protecting our clients’ business interests. We help our clients identify the contract language they need, and we offer comprehensive support in contract negotiation, drafting, translation, and enforcement.

But when our clients do find themselves in partnership/ownership dispute litigation, our business litigators work to present early options to protect our clients’ investments, including seeking temporary receiverships, accountings, and other remedies that can keep the dispute from leading to significant losses. We have successfully litigated many ownership disputes in many different courts.

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Our Clients' Successes

“Harris Sliwoski expertly guided us through the formation of our company. They continue to assist with necessary registrations and compliance with numerous regulations. They were able to promptly answer all our many questions and provide understandable options, explanations and practical advice. We expect to continue to use Harris Sliwoski on a regular basis as our company expands. They were also able to introduce us other professional experts. We would not hesitate to recommend Harris Sliwoski to any companies in need of legal advice.”

user icon Three Continents Foods LLC

This law firm was a huge help as our company went through the process of commercial licensing in the California cannabis industry.  They have helped us with a variety of legal issues in a timely fashion, while clearly communicating with us throughout the process.  Everyone we’ve worked with at Harris Sliwoski is an expert in their field and we have always felt that we were in good hands through our legal representation.

user icon Wil Crummer, CEO PRO Farms

Legal stuff is always scary. And I’ve had to play offense a couple times, begrudgingly. To have Harris Sliwoski have my back? It made things a lot less prickly. They quickly walked me through my options, and were refreshingly consistent in their communications, timing and billing. I’ve been lucky to stay out of the legal side of things my whole career, thankfully. When things went a little wrong, Harris Sliwoski quickly made things right.

user icon Aaron Draplin, Founder Draplin Design Co.

I am impressed with this law firm. They answered all my questions regarding cannabis businesses and the California cannabis framework, and they have helped me with a variety of legal issues in a timely fashion, while always clearly communicating with us throughout the process. They also redirected me to other quality people for my business needs. Everyone I worked with at Harris Sliwoski is an expert in their field, and I was in good hands throughout my legal representation.

user icon Corey T., CEO Thinc Cubed, LLC

I have been working with the lawyers at Harris Sliwoski for more than 20 years both as a business owner and as an executive at a large east-coast health system and that is because they have always efficiently provided high level and clear international law advice. Most recently, Harris Sliwoski provided legal support on many matters related to procuring medical products worldwide. Their support was particularly helpful to during the onset of COVID, when there was a big need for securing PPE quickly, all while navigating complicated international and domestic legal requirements. Harris Sliwoski’s team of international lawyers helped by conducting rapid-fire due diligence on potential suppliers, navigating the legal logistics for getting product from overseas and through U.S. customs, and drafting contracts to protect against various sorts of horribles. They did this by essentially providing what amounted to 24/7 service. I cannot recommend them highly enough.

user icon Dan Pak Hospital Supply Chain Executive

Harris Sliwoski has represented our company in the legal cannabis industry for years. Harris Sliwoski has advised us in a wide variety of legal matters, and they are truly experts in their field. I would highly recommend Harris Sliwoski to anyone with questions about cannabis law, or any legal matters. They have been great for our Company, and will continue to guide us as our industry evolves

user icon Matt Hurt, COO Cannabis Nation

You won’t find a better partner than Harris Sliwoski when trying to navigate the complex world of healthcare regulations.  They not only give sound and reliable legal advice, but they are also very responsive and are able to guide you in a way that helps you reach your business objectives as well.

user icon Joseph Axelrod, General Counsel Irwin Naturals

When we started the process of building a ‘seed to sale’ cannabis company in Oregon, we saw the need for expert legal counsel.  The cannabis sector is fraught with potential peril at every turn, and we wanted the best legal advice we could find.  After talking to several firms and individuals, we feel extremely fortunate to have chosen Harris Sliwoski as our legal counsel.

user icon Tony Theiss, CEO and Co-Founder Redbarn Cannabis 

We use Harris Sliwoski on all our international legal matters, including on our international litigation matters. We have over the last few years been involved in a couple big international legal disputes and Harris Sliwoski’s international dispute resolution team provided us with expert legal assistance on both matters. They were always very careful to explain to us what they were doing and why and what their actions would likely cost us in legal fees. Most importantly, we did extremely well on both cases and I have no doubt Harris Sliwoski was a big factor in that.

user icon Kevin English, CEO We Are Camp

We have used Harris Sliwoski for legal help related to our international manufacturing. The lawyers with whom I worked had extensive familiarity with the international legal issues involved in our various projects and offered us key insights. I particularly appreciated how they always quickly and efficiently do what they say they will do and always within their cost estimates.

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