Legal Question in Business Law in New York
Can and Owner/officer of a Corporation start a an LLC providing same services as Corporation without other officers knowledge or permission
3 Answers from Attorneys
You have certain legal obligations as an officer of a corporation to act in the best interests of that corporation. By intentionally competing with the corporation by forming a separate LLC may violate those obligations. Moreover, there may be provisions in the corporation's shareholders agreement or by-laws which may affect your ability to do this. I would strongly advise you obtain legal counsel to review your situation very carefully. Feel free to contact my office to discuss further.
Mr. Pepper is correct. Generally, officers of a corp owe a fiduciary duty to the corp and cannot act against its best interests.
The other attorneys are right on point. Officers owe a fiduciary duty to the corporation. if the information used to start and operate the LLC's business is derived from intellectual property of the corp, then additional violations arise. Consult with an attorney in your area for specifics.
Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise
Franchise Attorney
Related Questions & Answers
-
Is it considered infringement if I purchase something and then resell it for profit? Asked 6/10/10, 11:53 am in United States New York Business Law
-
I work for my parents who own a small corporation. A few years ago, we intended to... Asked 6/09/10, 12:16 pm in United States New York Business Law
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
