The discount for lack of marketability is a fixture in New York fair value jurisprudence as a result of almost 30 years of case law starting with Matter of Blake. Some prominent voices in the business valuation field are challenging the doctrine as wrong in theory and bereft of empirical support. Learn more in this week’s New York Business Divorce.
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Continue Reading The Marketability Discount in Fair Value Proceedings: An Emperor Without Clothes?

The statute governing LLC dissolution proceedings, unlike the one for corporations, does not require publication notice at the start of the case. So why do we still see LLC dissolution show cause orders requiring expensive publication? This week’s New York Business Divorce takes a look.
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Continue Reading There’s No Need for Publication Notice of LLC Judicial Dissolution Proceedings

Matter of Bernfeld, decided last week by a Brooklyn appellate panel in a signed opinion authored by Justice John Leventhal, offers a rare and fascinating encounter with an ultimately unsuccessful attempt to obtain judicial dissolution of a professional corporation under Section 1103 of the Business Corporation Law, brought by the widow of the deceased majority shareholder. If you are, or have a client who is, a co-owner of a professional corporation, do yourself a favor and read this week’s New York Business Divorce.
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Continue Reading Case Illustrates How Not to Plan for the Death of a Shareholder in a Professional Corporation

Last week’s rulings by New York’s high court in the closely-watched Centro and Arfa cases resolves much of the uncertainty that has surrounded the ability of controlling owners of closely held companies to bargain for effective releases against fiduciary-based claims of non-disclosure when buying out minority owners. Get the full story in this week’s New York Business Divorce.
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Continue Reading New York’s Top Court Resets the Bargaining Table When Controlling Owner of Closely Held Company Buys Out Minority Partner

A recent decision by Nassau County Commercial Division Justice Ira Warshawsky in Bombard v. Xitenel, Inc. takes a fresh look at the contract-based rules surrounding a disputed claim of stock ownership in a company operating a genetics-testing laboratory. It’s in this week’s New York Business Divorce.
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Continue Reading Failure to “Seal the Deal” Dooms Suit to Enforce Minority Stock Ownership Claim

A recent decision by the Appellate Division, First Department, in Frame v. Maynard authorizes the imposition of so-called Rothko damages against a general partner who breaches fiduciary duty by misrepresenting the value of partnership assets when buying out the limited partners’ interests. Learn more in this week’s New York Business Divorce.
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Continue Reading Rothko Damages Awarded for General Partner’s Undervalued Buyout of Limited Partners’ Interest in Realty Company

Two notable decisions handed down the same day last week by the Appellate Division, First Department, address claims against managers of Delaware LLCs for breach of fiduciary duty. The plaintiffs scored in one and struck out in the other. It’s in this week’s New York Business Divorce.
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Continue Reading One Hit, One Miss: NY Courts Decide Fiduciary Duties of Delaware LLC Managers

Better late than never, at least sometimes, is the common theme of the cases highlighted in this week’s New York Business Divorce. The cases examined include one shareholder’s effort to challenge the disposition of company assets 13 years after its dissolution and, in another case, an attempt to annul a default judgment of dissolution almost three years later.
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Continue Reading It Aint Over ’til It’s Over: Courts Decide Post-Dissolution Controversies

A decision last month by Nassau County Commercial Division Justice Ira Warshawsky, and two recent decisions by the Delaware Chancery and Supreme Courts, clarify issues of standing and scope in proceedings under the business corporation and LLC statutes for inspection of company books and records. Read more in this week’s New York Business Divorce.
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Continue Reading New York and Delaware Courts Clarify Petitioner Standing to Bring Books and Records Proceedings