Matter of Bernfeld, decided last week by a Brooklyn appellate panel in a signed opinion authored by Justice John Leventhal, offers a rare and fascinating encounter with an ultimately unsuccessful attempt to obtain judicial dissolution of a professional corporation under Section 1103 of the Business Corporation Law, brought by the widow of the deceased majority shareholder. If you are, or have a client who is, a co-owner of a professional corporation, do yourself a favor and read this week’s New York Business Divorce.
Continue Reading Case Illustrates How Not to Plan for the Death of a Shareholder in a Professional Corporation
New York’s Top Court Resets the Bargaining Table When Controlling Owner of Closely Held Company Buys Out Minority Partner
Last week’s rulings by New York’s high court in the closely-watched Centro and Arfa cases resolves much of the uncertainty that has surrounded the ability of controlling owners of closely held companies to bargain for effective releases against fiduciary-based claims of non-disclosure when buying out minority owners. Get the full story in this week’s New York Business Divorce.
Continue Reading New York’s Top Court Resets the Bargaining Table When Controlling Owner of Closely Held Company Buys Out Minority Partner
Failure to “Seal the Deal” Dooms Suit to Enforce Minority Stock Ownership Claim
A recent decision by Nassau County Commercial Division Justice Ira Warshawsky in Bombard v. Xitenel, Inc. takes a fresh look at the contract-based rules surrounding a disputed claim of stock ownership in a company operating a genetics-testing laboratory. It’s in this week’s New York Business Divorce.
Continue Reading Failure to “Seal the Deal” Dooms Suit to Enforce Minority Stock Ownership Claim
Rothko Damages Awarded for General Partner’s Undervalued Buyout of Limited Partners’ Interest in Realty Company
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.
Continue Reading Rothko Damages Awarded for General Partner’s Undervalued Buyout of Limited Partners’ Interest in Realty Company
One Hit, One Miss: NY Courts Decide Fiduciary Duties of Delaware LLC Managers
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.
Continue Reading One Hit, One Miss: NY Courts Decide Fiduciary Duties of Delaware LLC Managers
It Aint Over ’til It’s Over: Courts Decide Post-Dissolution Controversies
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.
Continue Reading It Aint Over ’til It’s Over: Courts Decide Post-Dissolution Controversies
New York and Delaware Courts Clarify Petitioner Standing to Bring Books and Records Proceedings
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.
Continue Reading New York and Delaware Courts Clarify Petitioner Standing to Bring Books and Records Proceedings
Court Rejects Marketability Discount, Applies “Murphy Discount” for Built-In Gains, in Determining Fair Value of Shares in Real Estate Holding Corporations
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.
Continue Reading Court Rejects Marketability Discount, Applies “Murphy Discount” for Built-In Gains, in Determining Fair Value of Shares in Real Estate Holding Corporations
Bonding a Fair Value Award: When Can the Court Require It?
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.
Continue Reading Bonding a Fair Value Award: When Can the Court Require It?
Judicial Estoppel + Dead-Man’s Statute = No Standing to Seek Judicial Dissolution of Close Corporation
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.
Continue Reading Judicial Estoppel + Dead-Man’s Statute = No Standing to Seek Judicial Dissolution of Close Corporation