Can a Shareholder Sue a Business Partner Directly in Maryland?

 Posted on September 29, 2026 in Business and Commercial Litigation

A business partnership dispute may not be personal, but it can certainly feel that way when another owner makes a decision that costs you money, shuts you out of the company, or uses business assets for their own benefit. In situations like these, business litigation is a necessity. 

Sometimes, a lawsuit can be brought directly from one shareholder to another shareholder, director, or officer. Other times, the company itself suffers the legal injury, which means the shareholder may need to bring a derivative lawsuit on the company’s behalf.

If you are managing a dispute with a business partner in 2026, a Gaithersburg, MD business litigation attorney at Fox & Moghul can help you understand your legal options and aggressively litigate on your behalf. 

What Is the Difference Between a Direct and Derivative Lawsuit?

A direct lawsuit is brought by a shareholder for harm done personally to that shareholder. A derivative lawsuit is brought by a shareholder on behalf of the company to recover for harm done to the company.

Maryland courts distinguish between the two by looking at the nature of the wrong and the relief being requested. If a duty was owed directly to the shareholder and that shareholder suffered a distinct injury, the claim is more likely to be direct. If the company suffered the injury and any recovery should go back to the company, the claim is generally derivative.

For example, say a shareholder takes $100,000 from the company and uses it personally. Every owner may lose money because the company is now worth less, but the $100,000 was taken from the company. A lawsuit seeking to recover that money would generally belong to the company and would be a derivative claim. 

In contrast, if another owner refuses to honor a shareholder agreement requiring them to buy your shares at an agreed price, the loss is yours personally. A lawsuit to enforce that agreement would generally be a direct claim.

Derivative lawsuits come with additional procedural requirements. Maryland Rule 15-1601 requires a derivative complaint to explain why the shareholder is entitled to sue on the company’s behalf. It must also describe efforts made to get the company to act, or explain why no such effort was made.

When Can a Shareholder Bring a Direct Claim Against Another Business Owner?

A shareholder may be able to sue directly when another owner violates a right that belongs specifically to that shareholder. Maryland law recognizes that shareholders can bring direct claims when they suffer an injury distinct from the harm suffered by the corporation. Rights connected directly to stock ownership can also support a direct claim.

Examples include disputes involving:

• Rights created by a shareholder agreement

• Interference with a shareholder’s voting rights

• Money owed directly to one shareholder

• Behavior that uniquely harms one owner’s individual ownership rights

However, simply losing money because the company lost money usually does not turn a corporate claim into a personal one. 

What Should I Do if I Think a Business Partner Has Harmed Me or My Company?

Before filing suit, your first task is to identify the specifics: Exactly what happened? Who was legally harmed? What remedy would actually fix the problem? That requires objective analysis and usually takes some serious investigation with an attorney’s help. 

A business litigation attorney will usually start by examining the agreements and records that define the relationship between the owners. These will show what rights each person had and whether those rights were violated.

You’ll also need to work closely with your lawyer to determine the outcome you actually want. Do you simply want to stop ongoing misconduct, or is the scope broader? Perhaps your focus is exclusively recovering money for the company or forcing another owner to honor an agreement. Your attorney will help you understand your options and which remedies are worth pursuing considering your goals. 

Call a Gaithersburg, MD Business Litigation Attorney Today

Business ownership disputes based on breaches of fiduciary duty and other corporate issues should be handled quickly, with the help of an experienced Rockville, MD business litigation lawyer at Fox & Moghul. We help clients identify the correct type of lawsuit and protect whatever rights were violated.

Attorney Faisal Moghul has been recognized as Virginia’s "Go-To" Business Lawyer and leads conversations in Maryland business and real estate law with a large collection of legal publications. Contact us at 703-652-5506 to discuss a dispute involving another shareholder, corporate officer, or business partner.