2011

A recent decision by the Appellate Division, First Department, in Frame v. Maynard authorizes the imposition of so-called Rothko damages against a general partner who breaches fiduciary duty by misrepresenting the value of partnership assets when buying out the limited partners’ interests. Learn more in this week’s New York Business Divorce.
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Continue Reading Rothko Damages Awarded for General Partner’s Undervalued Buyout of Limited Partners’ Interest in Realty Company

Two notable decisions handed down the same day last week by the Appellate Division, First Department, address claims against managers of Delaware LLCs for breach of fiduciary duty. The plaintiffs scored in one and struck out in the other. It’s in this week’s New York Business Divorce.
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Continue Reading One Hit, One Miss: NY Courts Decide Fiduciary Duties of Delaware LLC Managers

Better late than never, at least sometimes, is the common theme of the cases highlighted in this week’s New York Business Divorce. The cases examined include one shareholder’s effort to challenge the disposition of company assets 13 years after its dissolution and, in another case, an attempt to annul a default judgment of dissolution almost three years later.
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Continue Reading It Aint Over ’til It’s Over: Courts Decide Post-Dissolution Controversies

A decision last month by Nassau County Commercial Division Justice Ira Warshawsky, and two recent decisions by the Delaware Chancery and Supreme Courts, clarify issues of standing and scope in proceedings under the business corporation and LLC statutes for inspection of company books and records. Read more in this week’s New York Business Divorce.
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Continue Reading New York and Delaware Courts Clarify Petitioner Standing to Bring Books and Records Proceedings

Business valuation junkies, rejoice! This week’s New York Business Divorce revisits the Giaimo case, a bitter family business dispute being litigated in Manhattan Supreme Court, following a decision last week by Justice Marcy Friedman concerning a fair value determination by Referee Louis Crespo of a stock interest in two real estate holding “C” corporations, in which the discounts for lack of marketability and for built-in gains taxes take center stage.
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Continue Reading Court Rejects Marketability Discount, Applies “Murphy Discount” for Built-In Gains, in Determining Fair Value of Shares in Real Estate Holding Corporations

When the company or majority shareholder elects to purchase a dissolution petitioner’s shares for fair value, how can the selling shareholder be sure the purchaser will be able to pay the eventual award? The statute offers relief in the form of a bonding requirement, as illustrated in a recent case decided by Nassau County Commercial Division Justice Stephen A. Bucaria. Get the story in this week’s New York Business Divorce.
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Continue Reading Bonding a Fair Value Award: When Can the Court Require It?

This week’s New York Business Divorce tells a cautionary tale of a business partnership between a lawyer and his client turned sour, as revealed in a recent decision by Nassau County Acting Supreme Court Justice Thomas Adams in Matter of Gleich (Iceland, Inc.) where the court dismissed a dissolution petition for lack of standing.
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Continue Reading Judicial Estoppel + Dead-Man’s Statute = No Standing to Seek Judicial Dissolution of Close Corporation

Getting sued by your client’s adversary is an occasional occupational hazard for attorneys in any field, but perhaps more so for attorneys who represent closely held companies that fall into the business divorce maelstrom, as evidenced by Nassau County Justice Denise Sher’s recent decision in Aranki v. Goldman & Associates. It’s in this week’s New York Business Divorce.
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Continue Reading Lawyers Caught in the Crossfire of Shareholder Disputes

This week’s New York Business Divorce features an interesting decision by Commercial Division Justice Emily Pines in Nastasi v. Carlino, where she sent both sides home empty handed in a bitter shareholder dispute with misconduct on both sides.
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Continue Reading Court Sends Everyone Home Empty Handed in Bitter Business Breakup

Chris Mercer, one of the country’s leading authorities on business valuation, has written a series of important and helpful articles on the statutory fair value standard used by courts in dissenting shareholder appraisals and oppressed minority shareholder buy-out proceedings. Get a taste in this week’s New York Business Divorce.
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Continue Reading Chris Mercer Tackles Statutory Fair Value