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As New York’s Suffolk County continues to grow its population and economy, so too grows the volume and complexity of business litigation in the courts of Suffolk County Supreme Court. This week’s New York Business Divorce focuses on the Suffolk County Commercial Division, with a sampling of three recent decisions of interest by Justices Emerson, Pines and Whelan involving shareholder disputes. …
Continue Reading Business Divorce Cases in the Suffolk County Commercial Division

“Is she or isn’t she a shareholder? Only her tax preparer knows for sure.” It may not be quite as catchy as the famous Clairol commercial, but it’s a good entreaty to read this week’s New York Business Divorce highlighting a recent appellate ruling in a dissolution case in which the petitioner unsuccessfully relied on tax returns to prove his shareholder status.
Continue Reading Form K-1s Do Not Always a Shareholder Make

This week’s New York Business Divorce, highlighting a recent appellate ruling in Born to Build, LLC v. 1141 Realty, LLC, tells an unusual tale about an ultimately unsuccessful effort to dissolve a limited liability company by someone who claimed to have acquired through judgment enforcement proceedings a debtor’s undocumented membership interest in the LLC. …
Continue Reading For Sale: Undocumented LLC Membership Interest. Cheap.

This week’s New York Business Divorce features brief summaries of a handful of noteworthy court decisions that escaped my attention last year, including a pair of decisions involving deadlock and oppressed minority shareholder disputes, and another pair of decisions involving receivership applications.
Continue Reading Some Winter Case Notes

In prior litigation with his ex-wife, Gary Rubio swore he sold his shares in the family business to his father. When he brought a subsequent shareholder derivative action against his brother, he swore he didn’t, and proffered a company tax return to prove it. What’s a judge to do? Find out in this week’s New York Business Divorce.
Continue Reading Court Dismisses Shareholder Derivative Action Due to Inconsistent Stock Ownership Claim in Prior Lawsuit

The equitable remedy of constructive trust comes to the rescue of a minority shareholder in a family-owned business in Quadrozzi v. Estate of Quadrozzi, decided last week by the Appellate Division, Second Department. It’s in this week’s New York Business Divorce.
Continue Reading Case Illustrates Power of Constructive Trust to Establish Stock Ownership

In an unusual corporate dissolution case involving 50/50 shareholders decided last month by Justice Emily Pines, the court compelled a buyout of the petitioner’s shares by the other shareholder notwithstanding the latter’s consent to dissolution. Get the full story in this week’s New York Business Divorce.
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Continue Reading Court Compels Buyout Despite Consent to Dissolution

The doctrine of “unclean hands” played a decisive role in a recent decision by Justice Emily Pines in Kimelstein v. Kimelstein, in which the court dismissed a dissolution petition brought by someone who admitted that he never formalized his stock interest to keep it hidden from his ex-wives and the government. It’s in this week’s New York Business Divorce.
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Continue Reading Unclean Hands Defense Defeats Petitioner’s Shareholder Status in Corporate Dissolution Suit

A tattoo parlor business is the unusual setting for a decision last week by the Appellate Division, Second Department, affirming the lower court’s post-trial dismissal of an LLC dissolution case brought by a member claiming denial of her co-equal management rights. It’s “inked” in this week’s New York Business Divorce.
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Continue Reading Woe Unto the Undocumented LLC Member Seeking Judicial Dissolution

A recent decision by Justice Paul Feinman in Ng v. Ng illustrates the dilemma faced by a putative, undocumented shareholder in a close corporation who needs access to the corporate kit, tax and financial records — which generally only recognized shareholders are given — to establish his ownership claim. See how the court resolved the issue, in this week’s New York Business Divorce.
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Continue Reading Court Orders In Camera Review of Corporate Records in Fraternal Dispute Over Stock Ownership