Breach of Fiduciary Duty Remedies

When litigation remains your only option, you need to decide how your ideal resolution would look when you file a civil lawsuit for a breach of fiduciary duties. Read on to learn more.

Types of Remedies For Breach Of Fiduciary Duty

•  Actual Damages
  •    Economic Damages
  •    Out-of-Pocket Losses
  •    Lost Profits
  •    Mental-Anguish Damages
  •    Exemplary Damages
  •    Equitable relief
  •    Contractual-Consideration forfeiture
  •    Profit disgorgement

Damage Considerations

Actual damages also known by the term compensatory damages are awarded to compensate for an injury. Actual damages are divided into two categories, non-economic damages, and economic damages.

Economic damages cover lost profits and out of pocket expenses resulting from injuries.

Non-economic damages are things like mental anguish, but you have to show it is a result of the breach of fiduciary duty.

If you have evidence and can prove the breach of fiduciary duty was intentional you may be able to claim further damages, but these are capped by statues.

Equitable Relief

You may be able to obtain equitable relief, including but not limited to contractual-consideration forfeiture and/or profit disgorgement. Where actions constituting a breach in fiduciary duties amounts to a fraudulent inducement, a court can order all or part of the contractual consideration paid by the principal to the fiduciary to be forfeited.

Profit disgorgement is a typical equitable remedy that is normally found within corporations, partnerships, and limited liability companies. In this scenario, a fiduciary will improperly benefit either by competing directly with the principal/beneficiary or usurping an opportunity that properly belongs to the principal/beneficiary.  As such, a court may order all profits realized by the breaching fiduciary to be awarded to the principal/beneficiary.

We have found the buy-out tends to be a more frequent remedy ordered by the court. As courts have found that in light of the oppressive conduct, the continued ownership of the stock becomes untenable, as it leaves the minority in the position that the shareholder interest is practically worthless.

Source https://www.wattsguerra.com/commercial-litigation/what-are-my-remedies-if-i-sue-for-a-breach-of-fiduciary-duty/

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