The defense of “unclean hands” frequently is employed against petitions for involuntary corporate dissolution. A recent decision by Justice Stephen Bucaria, examined in this week’s New York Business Divorce, highlights the special considerations attendant to the defense in 50/50 deadlock dissolution cases, where the focus is less on fault and more on the existence of dissension.
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Court Determines Fair Value in Dissenting Shareholder Case Triggered by REIT Conversion
A one-of-a-kind, high-stakes dissenting shareholder appraisal proceeding is the subject of a fascinating decision by Justice Ira Warshawsky, in which he tackles disputes over trapped-in capital gains, marketability and minority discounts, widely disparate expert valuations, and entitlement to attorney’s fees and interest. Read about it in this week’s New York Business Divorce.
Continue Reading Court Determines Fair Value in Dissenting Shareholder Case Triggered by REIT Conversion
In Unusual Case, Illinois Appellate Court Reduces Fair Value Award to Dissenting Shareholder
An Illinois appellate court recently ruled in an unusual dissenting shareholder case on the valuation of shares in a single asset, real estate “C” corporation. It’s a highly interesting decision, pitting equitable considerations against valuation orthodoxy. You can either guess which prevailed, or you can read this week’s New York Business Divorce.
Continue Reading In Unusual Case, Illinois Appellate Court Reduces Fair Value Award to Dissenting Shareholder
Vermont Court Declines Jurisdiction Over Dissolution of Delaware LLC
This week’s New York Business Divorce travels to the Green Mountains of Vermont, whence comes a carefully reasoned decision holding that the courts of that state lack subject matter jurisdiction to hear a petition for judicial dissolution of a Delaware LLC. New York courts have reached the same conclusion, but without offering much if any analysis, which makes the Vermont case all the more noteworthy.
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Appellate Court Upholds Denial of Good Will Appraisal in Deadlock Dissolution Case
Fights over the good will value of a business are not uncommon in corporate dissolution and buyout proceedings. In this week’s New York Business Divorce, read about a recent appellate decision holding that courts lack authority to appraise good will post-dissolution in the absence of an agreement of the parties that good will is a distributable asset of the corporation.
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Court Rejects Unconscionability Argument in Family Partnership Valuation Case, Concludes that “Full and True Value” Equals “Net Book Value” as Defined by Agreement
The death in 2007 of Claudia Cohen, a well-known gossip columnist and socialite who married and divorced billionaire Ronald Perelman, led to a high-stakes litigation between her estate and her surviving brother over the valuation of the estate’s 50% share in a family partnership that directly or indirectly owned real estate interests with a market value over $20 million. A recent court decision ruled against the estate’s $11.5 million claim and, instead, enforced a $178,000 “net book value” buyout under the partnership agreement’s formula, also rejecting the estate’s argument that such a drastically below-market buyout was unconscionable. Read this week’s New York Business Divorce to get the full story.
Continue Reading Court Rejects Unconscionability Argument in Family Partnership Valuation Case, Concludes that “Full and True Value” Equals “Net Book Value” as Defined by Agreement
Case Illustrates Importance of Clear Valuation Parameters in Buy-Sell Agreement Among Owners of Closely Held Business
Including buy-sell provisions in a shareholders’ or operating agreement is a good idea, but if the agreement fails to clearly define basic valuation parameters it may lead to the very litigation that the agreement was intended to avoid. Case in point: Justice Ira Warshawsky’s recent decision in Sassower v. 975 Stewart Avenue Associates, LLC, featured in this week’s New York Business Divorce.
Continue Reading Case Illustrates Importance of Clear Valuation Parameters in Buy-Sell Agreement Among Owners of Closely Held Business
Delaware Chancery Court Rulings Interpret Member Rights to Inspect LLC’s Books and Records
Actions by non-managing business owners to gain access to company books and records are often precursors to dissolution or other more momentous litigation. The Delaware Court of Chancery recently issued several decisions in books and records actions involving LLCs which may provide guidance in cases involving New York LLCs as well. Catch up with the developments in this week’s New York Business Divorce.
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Controlling Shareholder’s Unreasonable Refusal to Admit Petitioners’ Stock Ownership Constitutes Ground for Corporate Dissolution, Incurs Award of Attorney’s Fees
A fight over ownership of a Long Island marina leads to an order granting corporate dissolution and awarding counsel fees based on the controlling shareholders’ unreasonable denial of the petitioning shareholders’ 50% ownership. Read about Justice Stephen Bucaria’s decision in Rosenfeld v. Luccaro in this week’s New York Business Divorce.
Continue Reading Controlling Shareholder’s Unreasonable Refusal to Admit Petitioners’ Stock Ownership Constitutes Ground for Corporate Dissolution, Incurs Award of Attorney’s Fees
Judicial Estoppel Doctrine Defeats Ex-Convict’s Standing to Bring Shareholder Derivative Action Based on Failure to Disclose Alleged Stock Interest to Probation Authorities at Time of Sentencing
Ex-convict Chip Watkins likely thought he’d paid his debt to society when he completed his jail sentence. As it turned out, however, Watkins short-changed society by failing to disclose to the authorities his claimed $600,000 investment in a closely held real estate company. In this week’s New York Business Divorce, find out how Watkin’s omission dashed his hopes of recovery in a shareholder derivative action recently dismissed by Justice Emily Pines.
Continue Reading Judicial Estoppel Doctrine Defeats Ex-Convict’s Standing to Bring Shareholder Derivative Action Based on Failure to Disclose Alleged Stock Interest to Probation Authorities at Time of Sentencing