Shareholder oppression—also known as minority shareholder oppression, squeeze out, or freeze out—is a general term for a claim or cause of action that may be made by a minority shareholder—a shareholder who owns less than a controlling percentage of the company—and is based on the alleged unfair or oppressive treatment of the minority shareholder.

Minority shareholder oppression claims often arise in closely-held corporations—corporations that are not publicly traded; in which a relatively small number of people own most or all of the shares; and in which the shareholders are often family members or people who know each other.

Those in control of a closely held corporation may use various squeeze-out or freeze-out tactics to deprive minority shareholders of benefits; to misappropriate those benefits for themselves; or to induce minority shareholders to relinquish their ownership for less than it is otherwise worth.

The types of conduct most commonly associated with such tactics include:

• denial of access to corporate books and records;

• withholding payment of, or declining to declare, dividends;

• termination of a minority shareholder's employment;

• misapplication of corporate funds and diversion of corporate opportunities for personal purposes; and

• manipulation of stock values.

In Ohio, shareholder oppression refers to actions taken by those in control of a closely-held corporation that unfairly prejudice the interests of minority shareholders. Ohio does not have a specific statute addressing shareholder oppression, but minority shareholders may still seek relief under Ohio's general corporate laws. Remedies for oppressive conduct may include actions for breach of fiduciary duty, as the directors and officers of a corporation owe a duty of loyalty and care to all shareholders. Additionally, Ohio Revised Code Section 1701.91 provides minority shareholders with the right to petition the court for relief if the acts of the directors or those in control of the corporation are illegal, fraudulent, or willfully unfair and oppressive to the shareholder. The court may order a variety of remedies, such as the purchase of the minority shareholder's shares at their fair value, the appointment of a receiver, or the dissolution of the corporation, among other things. It is important for minority shareholders who believe they are being oppressed to consult with an attorney to understand their rights and the potential remedies available to them under Ohio law.