Originally from:
Advising Minnesota Corporations and Other Business Organizations - 2nd Edition - Hardcover
Advising Minnesota Corporations and Other Business Organizations - 2nd Edition - Electronic
Preview Page
CHAPTER 48
SOME SPECIAL PROBLEMS OF CLOSELY
HELD CORPORATIONS
Section
§ 48.01 Overview of the Closely Held Corporation Legal Setting
§ 48.02 Deadlock and Dissension, Relatives, and Family Discord
§ 48.03 Shareholder Direct Liability
§ 48.04 Valuations of Shares
§ 48.05 Difficulty of Disposing of Share Interests
§ 48.06 Failure to Keep Records
§ 48.07 The Internal Revenue Service, Minnesota Department of Revenue,
and Central Person Concepts
§ 48.01 Overview of the Closely Held Corporation Legal Setting
Closely held corporations are defined in the Minnesota Business
Corporation Act as corporations that do not have more than thirty-five
members.1 Other states define close corporations as those whose shares
are not traded on a national stock exchange, or a corporation whose
shares are held in a few hands or families.2 Under these definitions, the
majority of all business corporations are close corporations,3 and over 90
percent of corporations in Minnesota are closely held corporations.4
While the typical close corporation differs from the publicly held
corporation by being much smaller, some close corporations are quite
large.5
Minnesota courts have strictly followed this sized-based definition
when the Minnesota Business Corporation Act expressly addresses an
issue.6 However, Minnesota courts have continued to apply a broader
common law definition of a close corporation for causes of action that are
not expressly governed by the Minnesota Business Corporations Act.7
The close corporation has different characteristics and attributes than
publicly held corporations. The typical close corporation has the
following characteristics:
Roger J. Magnuson is a Partner at Dorsey and Whitney, LLP, where he serves as Head of the National Strategic Litigation Group and has practiced since 1973. He has been recognized as one of the top trial lawyers in the United States by major national and international publications, including Chambers International Guide to American Lawyers, which profiles the top 500 trial lawyers in the United States, Best Lawyers in America, Who's Who in American Law, and Who's Who in America. Mr. Magnuson was also recognized by a Journal of Law and Politics' survey for Judge's Choice "Wins Most Cases."
Some high profile cases that he has litigated include representation of the Florida Senate in the Bush v. Gore election controversy in 2000; and representation of the Plaintiffs in the widely publicized and studied Mall of America case. For several years he has represented, among other persons and entities, the Minnesota Twins and Major League Baseball principals and players in litigation; and has litigated national and local cases in federal and state court venues. He has appealed before the Supreme Court in a number of cases; as well as the Minnesota Supreme Court. He has authored several articles and 7 books.
Richard A. Saliterman is a Principal in Saliternan & Siefferman P.C., a full-service firm in Minneapolis established in 1976. Mr. Saliterman is a leading expert on corporate business matters, and is the author of several publications on business start-ups, franchises, and trademarks. Mr. Saliterman is the former National Judge Advocate for the U.S. Navy League, based in Washington D.C.
Contributing Editor:
Amanda Chang
Contributing Authors:
Alecia Anderson
Seth Back
John Baker
Shannon Berg
Constatin Burachek
Benjamin Carpenter
Ryan Check
Carl Christensen
Peter Fear
Michael Frasier
Aaron Hall
Catherine Hanson
Paul Harman
Amy Ithlan
Michael Kern
Chris Kuhlman
