Betrayed by Your Brother, Your Cousin, or Your Parent: What a Business Litigation Attorney Sees
“You peel back the onion, and it’s not just about someone took this amount of money, allegedly. It’s, ‘mom loved you more than me, or dad loved you more than me.’”
That’s a business litigation attorney describing his cases to me. He represents the people who were harmed. Most of his work is disputes inside family businesses, such as a company a parent built and passed down to the children. I interviewed him about what those cases look like.
Family businesses are a much bigger part of the economy than most people realize. Research updated in 2021 counted 32.4 million family businesses in the United States, and together they employ 83.3 million people, which is 59% of the private workforce. Most writing about family businesses covers succession and taxes, and almost none of it covers what happens when someone you trusted betrayed you in business.
A family business betrayal and a partnership betrayal differ in one important way: where the trust came from.
With a co-founder, you looked at a person, weighed the choice, and decided to trust them. When they betray you, you start doubting your own judgment.
With a sister, a cousin, or a parent, you trusted them long before the business existed. That trust was never questioned, because you never had a reason to ask whether your own brother would steal from you.
And in the cases this attorney sees most, the siblings never chose each other as business partners. They own the company together because their parent left it to all of them.
“I trust my brother, I trust my sister, I trust my uncle,” is how he described his clients’ starting point.
Then comes the discovery, sometimes years later, that a million dollars is missing. He described what follows as shock and grief: “How did my family member steal money out of my pocket and my other sibling’s pocket?”
The theft usually happens inside a common arrangement: one sibling runs the business, and the others own shares but stay out of daily operations. The owners who aren’t there can’t see what’s happening with the money, so the theft can go unnoticed for years.
When the other owners finally ask questions, the sibling who runs the company uses the same arrangement as a defense. “You don’t know what you’re talking about, you don’t run the company, you’re not here every day.”
When these cases go to court in his state, he told me, they last at least two to three years. All of it happens in open court, on the public record.
The attorney sees these cases end one of two ways: some people settle because they’re exhausted, and others keep fighting even after they’ve spent more on legal fees than they could ever get back.
“You went to war with your sibling or business partner or best friend, and you’re not going to go grab drinks and grab dinner after. So it’s like a loss of a relationship.”
He’s describing grief, and grief is the problem the lawsuit doesn’t address. When your brother steals from the company you both own, the lawsuit handles the stolen money, and that’s the most obvious part the people around you will see. They’ll expect your grief to end when the case does. I’ve written about why a business betrayal is a loss to grieve rather than a lesson you failed to learn, particularly when the betrayer was family.
I asked him whether clients bring the emotional side of the case to him. “Not really,” he said, “and I don’t want to know.”
So for the two to three years the case lasts, the betrayed family member is alone with the grief, and with the question, “How could they do this to me?”
If your brother or sister took money from the company you both own, you’re probably asking how you missed it. You missed it because they controlled what you could see. They handled the books and the daily operations, and you owned shares but didn’t work in the business.
Clients come to me years after the case settled, still going over old conversations in their heads and rereading old financial statements.
I run one-day intensives for business owners after a business betrayal. After the intensive, you stop spending your evenings on the question of how you missed it. That makes it possible to sit across from your family at a holiday, or to skip it, without spending the week after thinking about what they did.
The intensive also works while a case is open, because the method I use doesn’t require you to discuss the case at all. I’ve written a separate article about therapy during business litigation, including what this attorney told me about talking to a therapist while a case is open.
You can read about how the intensive works by clicking the button below, or reach out directly to me with your questions.