Corporate Conflicts

A conflict between the owners of a Russian company rarely resolves itself. When partners stop agreeing, the company can freeze: no one approves the accounts, payments stall and the director acts without control. Attorney Elena Petrova advises participants of Russian LLCs and shareholders of joint-stock companies, including owners living in California, on exits, expulsions, deadlocks and claims against directors.

The first task is always the same: establish who controls what. We review the charter, the shareholder agreement, the registry record and the minutes of recent meetings, and check which decisions can still be taken without the other side.

What Owners Usually Fight About

Most disputes fall into a few recurring patterns. A minority owner is cut off from information and dividends. A majority owner wants to remove a partner who does nothing or damages the business. The director works for one side only. Or the partners simply want to separate and cannot agree on the price.

Each pattern calls for different tools. Access to documents, challenges to meeting decisions, claims for losses and exit mechanisms are all available under the Civil Code and the laws on LLCs and joint-stock companies. The choice depends on the evidence and on what the client wants at the end.

Leaving the Company

An LLC participant may withdraw only if the charter allows it. The company must then pay the actual value of the share, calculated from the net assets. Disputes almost always concern valuation, since the accounts may understate real assets.

Where valuation is disputed, a court-appointed expert usually decides the figure.

Expelling a Partner

Russian law lets participants ask the court to expel a partner whose actions or inaction make the company's work impossible or much harder. Courts require serious grounds: repeated blocking of key decisions, harmful transactions or competition with the company. A single disagreement is not enough. The expelled partner receives the actual value of the share.

Liability of Directors and Controllers

The Civil Code makes a director liable for losses caused by acting in bad faith or unreasonably. Participants can bring this claim on behalf of the company. Typical cases include transfers to affiliated firms, sale of assets below value and unexplained payments.

Persons who actually control the company without holding the post can face the same liability. The defence usually rests on showing an ordinary business risk and proper decision-making.

Challenging Decisions and Transactions

Meeting decisions taken without proper notice or quorum can be declared void. Major transactions and deals with an interest can be challenged if approvals were missing and the counterparty knew of it. Deadlines are short, so these claims need prompt action once the owner learns of the decision.

Building a Strategy

A strong position usually combines several steps: an information request, interim measures to block registry changes, a claim against the director and parallel negotiations. Many conflicts end in a buyout agreed after the first court rulings. We plan the case with that outcome in mind.

Getting Started

Send the charter, the shareholder agreement, the latest registry extract and a short account of the conflict. You will receive a map of options and deadlines.

The main channel of communication with the attorney is email: attorneypetrova1@gmail.com.