Mekhaya v. Eastland Food Corp.

BVLaw
Full Text of Court Cases
December 22, 2022
5149 Groceries and Related Products, NEC
424490 Other Grocery and Related Products Merchant Wholesalers
shareholder dissent/oppression
shareholder oppression, breach of fiduciary duty, closely held corporation, minority shareholder, majority shareholder, fiduciary duty, shareholders, salary, distributions, unjust enrichment

Mekhaya v. Eastland Food Corp.
256 Md. App. 497; 287 A.3d 395; 2022 Md. App. LEXIS 938; 2022 WL 17843057
US
State Court
Maryland
Appellate Court
Berger, Albright, Harrell, Glenn T., Jr.

Summary

The plaintiff pleaded a statutory claim for shareholder oppression. In October 2018, Mekhaya was fired from his position at Eastland, where his salary of $400,000 per year included an implied dividend. The implied dividend was also included in the salaries of the other shareholders, all relatives of Mekhaya. The defendants filed a motion to dismiss, which the district court granted. The plaintiff appealed. He noted that, after his removal, they paid themselves excessively high salaries and refused to pay him dividends, thus frustrating his expectations as a shareholder. The Appellate Court of Maryland disagreed with the decision of the trial court.
Mekhaya v. Eastland Food Corp.
PDF, Size: 366 KB

See Also

Maryland Court of Appeals Reverses Dismissal of an Oppression Claim—Finds There Could Be Disguised Dividend Issue

The plantiff pleaded a statutory claim for shareholder oppression. In October 2018, Mekhaya was fired from his position at Eastland, where his salary of $400,000 per year included an implied dividend. The implied dividend was also included in the salaries of the other shareholders, all relatives of Mekhaya. The defendants filed a motion to dismiss, which the district court granted. The plaintiff appealed. He noted that, after his removal, they paid themselves excessively high salaries and refused to pay him dividends, thus frustrating his expectations as a shareholder. The Appellate Court of Maryland disagreed with the decision of the trial court.