Family businesses can present challenging legal issues. Although you might feel like you can trust your family members to do the right thing, this is not always true, especially when large sums of money are involved. This case illustrates the complexities that resulted from agreements related to ownership of a family business, which was only resolved following multiple appeals.
Sam Broussard Jr. (BR) and his three sisters each owned 25% of Sam Broussard Trucking (“SBT”). After their parents died, BR was the president of SBT. His sisters agreed to make him the majority owner of SBT. Each sister received a Stock Redemption Agreement (“SRA”). Under the SRA, each of the three sisters agreed to transfer 171.5 shares of SRT stock back to SRT for $200,000.
One of his sisters, Guillory, filed a lawsuit against BR, claiming he had not kept his promises related to the SRA. At trial, the jury found BR had not given Guillory sufficient profits, as promised. The jury also found BR had violated the Louisiana Unfair Trade Practices Act, La. R.S. 51:1401. The jury awarded Guillory $69,084 for this violation. The jury also found Guillory’s error concerning the SRA invalidated it.