Portland Business & Commercial Law Blog

Shareholder disputes occur often in publicly-traded corporations, including in Oregon. There are a myriad of issues that can cause shareholder concern and a number of different ways in which shareholders may register their concerns. One way to do this is to raise shareholder concerns at the annual meeting. When such disputes become known, the company's attorneys are mobilized to monitor the situation and follow through if it may turn into an actionable business law dispute.

Such turmoil occurs even at the largest corporations. On June 7, Alphabet, the parent company of Google, held its annual shareholder meeting amidst a mini-resurrection of Google employees who came forth to challenge management regarding diversity in management positions, according to CNET. It may be that the disputes over a Google report on the gender gap that emerged in 2017 ignited a permanent area of interest regarding diversity at the company.

Mergers and acquisitions in Oregon and elsewhere can be financially complicated. Sometimes, the purchase price for acquiring another company is paid partly or totally in shares of stock of the purchasing company. Such transactions may contain risk but generally a team of business law attorneys and financial experts calculate the elements and benefits of the transaction very carefully in advance.

One recent merger transaction in another state involved partial payment in shares of stock for the purchase price. Emclaire Financial Corp. entered into an agreement to acquire Community First Bancorp Inc. for stock and cash that totals $17 million. Emclaire is a banking institution that has 17 branch offices in its region. Community First is a smaller financial firm in the same geographical region with four branches.

The validity and enforcement of arbitration clauses in contracts has been a volatile issue in business litigation courts in Oregon and the rest of the country. Such clauses come up in a number of contexts. Some are inserted in credit card contracts to compel consumers to arbitrate disputes rather than sue the company. They exist widely in contracts between businesses, calling for arbitration instead of litigation.

In general, the trend has been for the courts to uphold the validity and enforceability of such clauses. The U.S. Supreme Court ruled on May 21 that companies may compel their workers to engage in arbitration regarding wage and other employment disputes. The decision came from a hotly divided 5-4 vote of the Justices. The decision has a decidedly anti-union type of perspective in that it says that employers can prevent employees from acting together to bring their claims collectively or in class actions.

Legal disputes in Oregon and elsewhere do not always involve exclusively private business interests. There are often public agencies and municipal authorities that are involved in business litigation controversies. Public entities execute many contracts with private companies for services and products, opening the door for conflicts and disputes that sometimes make their way into the state and federal court system for resolution.

One recent example in Oregon of a dispute between a private entity and a public agency involves a lawsuit filed in state court against the Eugene Water & Electric Board. A manufacturer of smart meters, Sensus USA, sued EWEB and obtained a temporary restraining order stopping the agency from releasing the details of its contract with Sensus to its customers. The dispute arises regarding a lengthy contract in which EWEB agrees to pay Sensus $20.2 million for a smart meter system, which is also called an advanced metering infrastructure.