The road to a business divorce can be a long and litigious one, strewn with obstacles big and small, limited only by the cleverness of the business owners and their counsel as each side strives to gain superior bargaining leverage against the other in anticipation of the inevitable buyout or other separation agreement.
The jousting can be especially intense in a business divorce between family members. The cost/benefit calculus that normally moderates tactics in and out of court is often warped by the intense emotions characteristic of a litigation pitting parent against child, sibling against sibling, cousin against cousin, and so on.
There’s a case pending in the Suffolk County Commercial Division, Margiotta v Tantillo, Index No. 62839-2013, that exemplifies the extraordinary demands upon the court’s resources as it’s called upon repeatedly to grant various forms of interim relief to one side or the other in a hotly contested family business divorce. A pair of recent decisions in the case by Justice Emily Pines also highlights the limitations upon the court’s power to grant interim relief when it comes to requests for mandatory injunctive relief, that is, requiring a party to perform some positive act as opposed to restraining them from doing something.
The stakes in Margiotta include a number of auto dealerships and the real properties on which they operate. The business was founded and controlled by the family patriarch, Anthony Tantillo, who died in 2013 at the age of 82. During his lifetime Mr. Tantillo brought into the business and gave minority interests to two children from his first marriage. He also brought into the business a stepson from his third marriage. His will left most of his estate to his two natural children and appointed one of them his executor. Possibly unknown to his two natural children until after his death, he also executed documents or entered into transactions that gifted company shares or otherwise gave majority ownership of several of the operating and realty companies to his stepson. Continue Reading Court Denies Mandatory Injunctive Relief in Battle for Control of Family Business