This 7th annual edition of Summer Shorts presents brief commentary on three must-read decisions in business divorce cases involving the use of special litigation committees in derivative actions by LLC members; dissolution of a family-owned real estate holding corporation and LLC; and a Delaware case in which Chancery Court ordered dissolution of a deadlocked LLC co-owned by celebrity chef Gordon Ramsay.
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Does Your LLC Agreement Have a Purposeless Purpose Clause?
By Peter A. Mahler on
Did the Appellate Division, Second Department, throw us a curve ball in its decision last week in Mace v. Tunick, reinstating an LLC dissolution complaint based on its finding that the operating agreement’s purpose clause, authorizing the LLC to engage in “any lawful business,” did not set forth “any particular purpose”? Learn more about this important development 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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Navigating Rocky Shoals and Safe Harbors When Board Members Fix Their Own Compensation
By Franklin C. McRoberts on
Posted in Delaware, Derivative Actions
This week’s New York Business Divorce features a recent decision in which the court addressed novel issues — and found guidance in Delaware case law — in a shareholder derivative action challenging compensation packages given to officer/directors.
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Books and Records Case Illustrates Crucial Importance of Pre-Suit Demand
By Peter A. Mahler on
This week’s New York Business Divorce looks at a noteworthy decision by Manhattan Commercial Division Justice O. Peter Sherwood in which he dismissed claims by a minority member of Delaware LLCs for inspection of books and records. …
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It’s a Partnership! No, It’s an LLC! No, It’s Both!
By Peter A. Mahler on
It’s common practice to convert old realty-holding general partnerships to LLCs for financing and liability purposes. Given that partnerships and LLCs are distinct entity forms governed by distinct statutes, can a pre-conversion partnership agreement nonetheless be enforced among the post-conversion LLC members? Find out in this week’s New York Business Divorce. …
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Interview With Justice Carolyn Demarest (Ret.) on Litigating and Mediating Business Divorce Cases
By Peter A. Mahler on
Posted in Arbitration and Mediation, Podcasts and Video
This week’s New York Business Divorce previews and links to the latest podcast episode of the Business Divorce Roundtable featuring an interview with retired Commercial Division Justice Carolyn Demarest in which we discuss the litigation and mediation of business divorce cases.
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Minority Shareholders’ Derivative Suit Foiled by Voiding of Corporation’s Charter for Nonpayment of Taxes
By Franklin C. McRoberts on
Sometimes the tax collector can prove the bigger impediment to minority shareholder claims than the majority shareholders, as explained in this week’s New York Business Divorce featuring a recent case involving a Delaware corporation whose charter was voided for nonpayment of taxes.
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In Dispute Over Partnership’s Conversion to LLC, Court Finds No Duty to “Spoon-Feed” Sophisticated Investor
By Peter A. Mahler on
Posted in LLCs, Partnerships
The Latin maxim, “equity aids the vigilant, not those who slumber on their rights,” steals the show in this week’s New York Business Divorce featuring a recent New Jersey appellate ruling affirming the dismissal of a challenge to the conversion of a limited partnership to an LLC.
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Appraisers’ Valuations Are Light-Years Apart, But Does That Make Them Hired Guns?
By Peter A. Mahler on
This week’s New York Business Divorce travels to the Land of 10,000 Lakes a/k/a Minnesota where a recent court decision in a high-stakes stock valuation case generated some fairly sharp criticism of the expert appraisers whose values differed by almost 400%. …
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