Dissolution Procedure

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Unlike regular lawsuits that can be initiated with a notice pleading, a petition for involuntary corporate dissolution must contain detailed factual allegations supported by any available documentary evidence to establish the requisite grounds, be they oppressive action, fraud, waste and looting, or deadlock. A recent decision by Nassau County Commercial Division Justice Timothy S. Driscoll in Matter of Comparato illustrates the dire consequences of a petition that relies solely on conclusory allegations of misconduct. It’s in this week’s New York Business Divorce.
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Continue Reading Attention All Would-Be Corporate Dissolution Petitioners: Notice Pleading Doesn’t Cut It. You Need to Allege Facts. Lots of Them.

The issue of venue rarely is contested in corporate dissolution cases thanks to special venue provisions in the Business Corporation Law and the LLC Law that require the case to be filed in the judicial district listed in the organizational documents filed with the Secretary of State. This week’s New York Business Divorce reports on a rare exception which reached the Appellate Division, Third Department, in Matter of Supplier Distribution Concepts, Inc.
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Continue Reading Vying Over Venue in Corporate Dissolution Proceedings

This week’s New York Business Divorce features a nuts-and-bolts issue concerning the limited availability of depositions and other discovery in corporate dissolution cases, prompted by a recent ruling on the subject by Nassau County Commercial Division Justice Timothy S. Driscoll in Matter of Kaufman (L.I. Yellow Cab Corp.).
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Continue Reading Do Not Take Pre-Trial Discovery for Granted in Corporate Dissolution Proceedings

How might involuntary corporate dissolution figure into what otherwise would be a garden variety action for goods sold and delivered? Find out in this week’s New York Business Divorce as it examines a recent decision by Justice Daniel Palmieri in The Woods Knife Corp. v. Eastman Machine Co.
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Continue Reading Dissolution Counterclaim Fails to Stall Action for Goods Sold and Delivered

Two feuding 50-50 shareholders enter a buy-sell option agreement in which either one can offer his shares to the other at a fixed price and, if the offer is declined, the corporation is voluntarily dissolved. One of them later offers his shares. The other declines. Sounds like simple plan to avoid a messy court battle, right? Not quite, as you’ll find out in this week’s New York Business Divorce discussing a recent decision by Justice Ira Warshawsky.
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Continue Reading Court Grants Dissolution, Rejects Claim that Failed Buy-Sell Agreement Was “Ploy” by Petitioner to Take Over Corporation’s Retail Store Lease for His New Business

When a claim for judicial dissolution is denied or otherwise drops out of the case, that doesn’t necessarily mean the case is over. This week’s New York Business Divorce discusses two recent decisions by Justices Patricia Satterfield and Shirley Werner Kornreich in which the side opposing dissolution prevailed but left unresolved other claims addressing the parties’ underlying differences.
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Continue Reading Winning the Dissolution Battle, Losing the War

The LLC Law authorizes a court to decree dissolution of a limited liability company “on application by or for a member.” Must the application be made by way of a complaint in an action or a petition in a special proceeding? How about by way of a motion or cross motion without a pleading? Find out how New York County Commercial Division Justice Bernard J. Fried answered these questions in a recent ruling featured in this week’s New York Business Divorce.
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Continue Reading Application for Judicial Dissolution of LLC Must Be Made by Complaint or Petition, Mere Motion Will Not Suffice

If you’re going to accuse your business partner of bad acts and ask for judicial dissolution of the business, be prepared to settle or take the case all the way to trial. That seems to be the message given to the petitioner in a recent case highlighted in this week’s New York Business Divorce, when the court turned down her request to withdraw the case “without prejudice.”
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Continue Reading Court Rejects Bid by Corporate Dissolution Petitioner to Voluntarily Withdraw Case Without Prejudice

The necessity of an evidentiary hearing is a threshold issue in corporate dissolution proceedings. A recent decision by Suffolk County Commercial Division Justice Emily Pines serves up a good illustration of how courts approach the issue. Read more in this week’s New York Business Divorce.
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Continue Reading Disputed Allegations of Shareholder Oppression Require Evidentiary Hearing