One interesting fact about New York and New Jersey law is that although each state has its own laws with many variations‚ there are nevertheless overwhelming similarities when it comes to partnership and shareholder disputes. Yesterday I had the benefit of appearing for two separate hearings – one in New York and one in New Jersey – and both involved an Order to Show Cause and a request for some form of injunctive relief related to a partnership and shareholder dispute. After both hearings‚ it was quite apparent for me that in both New York and New Jersey the benefits of filing an Order to Show Cause and seeking an injunction – assuming that you have the right case and follow the right approach – are substantial. Setting aside the particular outcome and whether or not an injunction is granted‚ there are numerous “procedural benefits” that you should be aware of. These benefits include:
- Case Acceleration– The filing of an Order to Show Cause (an Order to Show
Cause is the name for an emergency motion filed with a NY or NJ court) will accelerate your entire lawsuit and‚ more likely than not‚ serve to efficiently bring about a legal outcome or settlement. A typical lawsuit – one traditionally started by the filing of a complaint (not an Order to Show Cause) – will take many weeks and months before you even get assigned to a judge. When an Order to Show Cause is filed‚ you are granted an immediate hearing before a judge and after that hearing all other aspects of your lawsuit‚ more likely than not‚ will be accelerated.
Why will this benefit you? First because when faced with a serious partnership dispute you may need the immediate intervention of the court to prevent things such as a partner lockout or misappropriation of funds. Second‚ because delayed litigation is inefficient and‚ many times‚ wasteful.
- Evidence Acceleration – When an emergency Order to Show Cause if filed
whereby you seek a court imposed injunction to stop or limit certain actions of your partner – you will be submitting factual affidavits to support your case. In turn‚ your partner and his or her attorney will submit their own affidavits in response
Why will this benefit you? Because you will be accelerating the “discover process” and forcing your partner to immediately respond and “lock-in” his or her position. Your partner will be required to immediately submit an opposing affidavit that he or she will sign. This affidavit must be prepared quickly and will be filed with the court. Although you should expect your partner to try to contradict your claims‚ a benefit arises since your partner must immediately act and make statements. Once these statements are made they can’t be taken back and at least you will know what issues you must address in the lawsuit. In a traditional lawsuit – one filed by the filing of a complaint – it may be many months before your partner is required to commit to a position.
By New York and New Jersey Partnership and Shareholder Lawyer
Charles N. Internicola‚ Esq.