QUESTION

I have been fired by my other partners?

Asked on Sep 24th, 2014 on Business Law - Pennsylvania
More details to this question:
I am a 49% stockholder in a Pennsylvania S-Corp and a managing partner, and hold the VP and Secretary Positions on the Board, We have no actual partnership agreement, but in a signed Stock Purchase agreement it clearly states that we will form a "Partnership" and and we have filed K1's with the IRS for the past 3 years showing a the proper split of the profits, in addition this contract specifies that the CEO will receive a salary and the Secretary (me) will also receive a salary with no specific contract period or added bylaws that would provide for any termination,, recently the two other partners and stockholders that hold 51% of the stock presented me with a termination letter, changed the locks, and refused to let me enter the business, the termination is totally fabricated to which I have a very valid witness..is this a legal action? They also stated that they are removing me as a corporate officer, which because I am also a stock holder I know they cannot do, your thoughts?
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1 ANSWER

Business Law Attorney serving Pittsburgh, PA at Fiffik Law Group, P.C.
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This is a very complicated situation and much of the answer depends on the exact language of the various agreements that you've mentioned  You have a variety of "relationships" with the company, each of which is governed by different laws.  One is as a shareholder.  This is governed by the Business Corporation Law.  It does not sound like your partners necessarily violated this law.  But perhaps their actions were taken without proper notice or following official protocols for shareholder or board of direction action.  As such, their actions may be void for failure to follow these procedural rules.  Another relationship to the company is as an employee.  Unless you have an agreement that outlines when and under what circumstances your employment relationship can be termined, you are subject to the employment at will law in Pennsylvania.  The fact that you are a shareholder does not exempt you from the employment at will doctrine under the law.  Finally you have a contractual relationship via the shareholder agreement.  That agreement may address what happens with your status as a shareholder when your employment is terminated.   These types of disputes are often very complex.  In addition, quick action is often necessary to afford you the maximum options for remedies for your partners' actions.  I would highly recommend that you seek counsel as soon as possible.   
Answered on Sep 25th, 2014 at 1:56 PM

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