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New Definitions of Shareholder Abuse on the Horizon

Walter Williams - Tuesday, May 20, 2014

Once a company is owned by more than one person, there are a series of rights and responsibilities that go along with that shared ownership. Under Texas law, shareholders who do not control a company have the right to be treated fairly by the majority shareholder or controlling group of shareholders. 


As one might expect given the growing economy and the broad definition, shareholder oppression litigation has exploded in Texas. 


In Ritchie v. Rupe, 339 S.W.3d 275, 289 (Tex. App.--Dallas 2011, pet. granted), the Dallas Court of Appeals used the well-known definition of minority shareholder oppression:


“The term is expansive and covers a multitude of situations dealing with improper conduct; thus a narrow definition would be inappropriate.Texas courts have generally recognized two non-exclusive definitions for shareholder oppression:


1. majority shareholders' conduct that substantially defeats the minority's expectations that, objectively viewed, were both reasonable under the circumstances and central to the minority shareholder's decision to join the venture; or

2. burdensome, harsh, or wrongful conduct; a lack of probity and fair dealing in the company's affairs to the prejudice of some members; or a visible departure from the standards of fair dealing and a violation of fair play on which each shareholder is entitled to rely.”

This scrutiny is heightened when the company is a small or closely held corporation. In that case, "Courts take an especially broad view of the application of oppressive conduct to a closely [ ]held corporation, where oppression may more easily be found." Id. at 290; citing Davis 754 S.W.2d at 381.


The Texas Supreme Court granted the petition last year and heard argument earlier this year. Two other shareholder oppression cases from the Dallas Court of Appeals will likely be decided at the same time. 


The decisions are expected to come down this summer. The Court will have the opportunity to further define the scope of a minority shareholder oppression claim, decide if shareholder oppression is a fact question or a legal question for the court. 


Given the conservative makeup of the Court and the relatively weak facts supporting oppression in the Ritchie v. Rupe case, we can expect that the Court will reverse the lower courts and perhaps render a decision in favor to the defendant and to narrow the scope of shareholder oppression claims.


However the Court decides, don’t expect the number of shareholder oppression cases filed in Texas to taper off any time soon.  

Reasons MuseGrid is my Favorite Thing Right Now

Patricia Small - Thursday, April 17, 2014

Building a website can be daunting, even for computer whizzes with extensive coding knowledge (which I am certainly not). After struggling with some online web designing tools and throwing my hands up in frustration trying to work in Adobe Dreamweaver, I discovered another Adobe product called Muse. Let me just say, thank you Adobe geniuses. Muse is a web building tool for designers. You can drag and drop content from a built in widget library, and design your website using an interface similar to Adobe Indesign. The best part? It generates the code for you, and if you do have some HTML background you can still tweak the code yourself. I've been plugging away on our new website, learning tons of cool things about the new features, getting super excited about the design, basically loving everything about Muse.


Now for the downside. Muse doesn't have a blogging capability. You can design a page to look like a blog, but it won't have any of the features like tags, archives, comments, etc. For marketers, the most important aspect of a blog is SEO. You want your content to show up on search engines. That is the point of regularly updated content. So while Muse does allow you to embed a blog from a third party site like wordpress or nabble, non of that content is recognized natively on your host server. That means it does nothing for you in terms of getting your website on the top of the search pages. 


After discovering this (and already having embedded a third party blog), I started following some threads on the Adobe Community Forum page. Most people were frustrated by the lack of blogging capacity offered by Muse, and the difficulty of getting Muse to integrate with another great Adobe product called Business Catalyst. BC does allow you to create a blog, and offers a whole smorgasbord of other useful features that you can check out here, but BC requires extensive coding knowledge, which as mentioned above, I don't have.


Enter musegrid. For $19.99 you can get a module package that includes the embedded BC blog, paragraph styles so you can change the look and feel of your blog directly in muse, and the widget to add a latest news feature directly to your homepage. It took a tiny bit of configuring to get things looking exactly the way I wanted, but I used this comprehensive tutorial, and there is also a great step by step guide included in the downloaded files from musegrid. You will have to host  your site with Business Catalyst, for the basic marketing package you get several features for $16.99 a month, but you get the SEO function third party blogging sites don't offer because all of your info is stored on one platform. Can I just say, musegrid, thank you for doing what Adobe is dragging their feet to get done and making this so much easier for design oriented muse users who need the blogging capabilities of Business Catalyst. Hats off to you my friends. 


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