In this week’s New York Business Divorce, a wild tale of a settlement achieved, settlement spurned, and a litigant threatened with incarceration for contempt in an intensely bitter, nine-year battle between two brothers over their Manhattan-based real property LLC.
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Liquidation
When Dealing in Partnership Owned Real Property, Caveat Emptor
By Franklin C. McRoberts on
In this week’s New York Business Divorce, read about how dissenting general partners can potentially wreak havoc on partnership real property sales, and how buyers can protect themselves from judicial invalidation of their transactions.…
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Bona Fide Purchaser Avoids Rescission of Minority Shareholder’s Unauthorized Sale of Corporation’s Realty
By Peter Mahler on
Posted in Interim Remedies, Liquidation
In this week’s New York Business Divorce, find out what happened when the majority shareholder petitioned to rescind the minority shareholder’s unauthorized sale of the corporation’s realty to a third party purchaser in violation of the court’s restraining order. …
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Superstorm Sandy Unable to Wash Away Sin of Contempt
By Franklin C. McRoberts on
Posted in Liquidation, Receivership
Corporation dissolved. Receiver appointed. Missing inventory. Contempt application. Blame it on Superstorm Sandy? Frank McRoberts explains in this week’s New York Business Divorce.…
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And the Award For Most Oppressive Conduct By a Majority Shareholder Goes to . . .
Minority shareholder oppression on steroids is one way to describe what happened in Matter of Twin Bay Village, Inc., in which an upstate appellate panel recently affirmed an order dissolving the corporation and setting aside a stock issuance that diluted the minority shareholders. Learn more in this week’s New York Business Divorce.…
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The Elusive Surcharge in Dissolution Proceedings
By Peter Mahler on
New York’s statutes authorizing a judicial dissolution petition by oppressed minority shareholders, and granting respondents a corresponding right to elect to purchase the petitioner’s shares, include a provision for a “surcharge” upon controlling shareholders for wrongful dissipation or transfer of corporate assets. It’s a rarely litigated provision, as evidenced by a court decision last month which may be the first ever reported case in which a surcharge claim was upheld. Learn more in this week’s New York Business Divorce. …
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Court Dissolves LLC Due to Managing Member’s “Self-Dealing and Dishonest Conduct”
By Peter Mahler on
Another family-owned business on the rocks takes the spotlight in this week’s New York Business Divorce featuring a recent decision by Justice Christine Sproat granting an LLC dissolution petition. …
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Transfer of LLC’s Assets to Subsidiary Triggers Unintended Dissolution
By Peter Mahler on
This week’s New York Business Divorce highlights a fascinating case involving a chain of walk-in airport spas known as XpresSpa, in which Justice Melvin Schweitzer recently ruled that the structuring of a capital investment by a private equity firm triggered a dissolution of XpresSpa’s parent company under the terms of its operating agreement. …
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How Should Courts Maximize Shareholder Value When Dissolving Deadlocked Companies?
By Peter Mahler on
The decision highlighted in this week’s New York Business Divorce may not be new, but it is one that deserves serious attention as a possible remedial template in deadlock dissolution cases, where one 50% owner with operational control uses it as a sword to force the other 50% owner to accept an under-valued buyout. …
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Minority Shareholder’s De Facto Liquidation Claim: Direct, Derivative, or Both?
By Peter Mahler on
Classifying a shareholder claim as direct or derivative has important consequences at the pleading stage and beyond. This week’s New York Business Divorce looks at a recent decision by Justice Melvin Schweitzer in which he concluded that the defendant majority shareholder’s alleged breaches of fiduciary duty, constituting a “de facto liquidation” of the company, could support dual direct and derivative claims.…
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