Employee Equity Dispute Attorneys in Los Angeles
Representing Your Right to Fair Compensation
With the shift to the information economy, more and more employees are working in the information and technology sectors. Equity grants, either as stock options or outright share grants, are increasingly offered as a form of compensation. However, stock option agreements vary dramatically, and are often written in a way to prevent easy understanding by employees and trap the unwary.
Ways That Companies Wrong Employees Using Equity Grants
Companies place many limits on the vesting and use of equity compensation and, without legal guidance, employees risk losing some or all of their promised equity. Companies also often attempt to trick employees in waiving their rights or losing their options through a variety of legal maneuvers. Legal disputes over stock options and equity agreements are on the rise and employees need competent counsel to help them navigate these complex issues and litigate when a company refuses to honor its promises to pay equity. Here are some examples of misconduct our attorneys have handled:
- Failure to Give Notice of How and When to Exercise Options: Often, under a master stock agreement, an employee will have only 90 days from the date of termination or separation to inform the company that they want to exercise the options and pay the strike price. However, in these instances, company will fail to provide you with information on how to exercise your options or even the due date—hoping that you miss the deadline.
- Concealing Information About the Value of Stock Options: Often, non-public or closely held companies withhold financial data that’s needed to value the worth of the stock options. Without this information, employees cannot make a reasoned decision to pay the money exercise their options and might fail to exercise even though it would be a good decision to do so.
- Playing Games with Vesting Schedules: A vesting schedule determines how long it takes for shares to became your property. Stock typically vest over a period of time, like 3- to 5-years, but can accelerate if there is a change in control, like an IPO or the sale of substantially all of the company’s assets. Often, a company fails to inform employees of acceleration events or claims that they didn’t occur in an attempt to illegally limit the amount of equity owned by the employee.
- Firing You to Eliminate Your Options: Other times, a company will attempt to fabricate “good cause” in terminated an employee to cut off their right to unvested stock.
Companies might also try to get you to give up vested stock as part of a severance agreement without paying you fair value—or even anything—for the equity. Don’t sign anything when you separate with the company without first seeking legal advice or you risk losing your valuable equity compensation.
You Need Experienced Attorneys to Fight Your Employer
Stock option agreements are notoriously complex and hard to understand. If you’ve are currently in a stock option dispute, or if your employer is withholding your equity, call King & Siegel today. King & Siegel has many experienced attorneys who have successfully litigated or resolved employee stock option and equity disputes. We are here to help. Call us now for a free consultation.
Contact us now at (213) 214-3757 so you can rely on our zealous employment lawyers at King & Siegel LLP for detailed answers to your questions.