The phrase “naked expulsion clause” is not a biblical reference to Adam and Eve’s eviction from the Garden of Eden. It’s about a provision in an LLC agreement at the center of a recent ruling by the Appellate Division, Second Department, in a 10-year litigation saga involving a fractured family-owned business. This week’s New York Business Divorce has the story.
Continue Reading Court Enforces LLC Agreement’s “Naked” Expulsion Clause

It’s time for another cross-country trip in this week’s New York Business Divorce which summarizes a quintet of recent appellate decisions in business divorce cases by courts outside New York.
Continue Reading Business Divorce Nation: A Cross-Country Tour of Recent Decisions of Interest

Was the company worth $30 million or $6 million? That was the question recently decided by Justice Vito M. DeStefano who presided over a 7-day fair-value appraisal hearing in Magarik v. Kraus USA, Inc. This week’s New York Business Divorce has the story.
Continue Reading $30 Million Appraisal of Plumbing Fixtures “Marketeer” Goes Down the Drain at Fair Value Hearing

George Costanza would be unhappy to hear about an Appellate Division decision last week affirming a trial court ruling, among others of interest in an LLC appraisal proceeding, in which it rejected as “double dipping” a request for post-valuation date income distributions on top of the fair value award. Learn more in this week’s New York Business Divorce.
Continue Reading No Double Dipping! Court Denies Post-Valuation Date Distributions in Equitable Buyout of LLC Member

Should the fair value award in a judicial dissolution proceeding, following the respondent’s election to purchase and an appraisal proceeding, be reduced by post-valuation date shareholder distributions? Find out in this week’s New York Business Divorce.
Continue Reading Post-Valuation Date Distributions: Should They Be Credited Against Fair Value Awards?

Are stock appraisals done for estate tax purposes discoverable in stock valuation proceedings or other types of shareholder disputes involving the shares of a deceased stockholder or of someone who inherits shares from the estate? A recent appellate decision on the topic is the springboard for this week’s post.
Continue Reading Disclosure of Estate Tax Stock Appraisals in Shareholder Disputes