There is nothing “unique” or “even unusual” about deadlock dissolution cases that place them outside the scope of a broad arbitration clause in a shareholders’ agreement, rules Justice Ira Warshawsky in a recent decision featured in this week’s New York Business Divorce.
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Continue Reading No Exception to Arbitration for Deadlock Dissolution Petition, Court Rules

The hiring by one 50% business owner of legal counsel to take action in the company’s name against the other 50% owner is a frequent source of litigation. This week’s New York Business Divorce revisits the Caplash case, which involved this issue in the LLC context, on the occasion of a new decision by the Appellate Division, Fourth Department, affirming rulings by Justice Kenneth Fisher.
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Continue Reading Appellate Court Affirms Caplash Ruling Rejecting Authority of 50% LLC Member to Hire Company Counsel in Proceedings Against Other 50% Member

Stock valuation junkies, this week’s New York Business Divorce is for you, as we examine a recent Fourth Department decision that weighs in on the controversial issue whether the discount for lack of marketability applies only to the company’s good will or to the entire enterprise value.
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Continue Reading Appellate Ruling in Stock Valuation Case Further Muddies the Marketability Discount Waters

A decision last week by the Second Department highlights a split of authority among New York’s intermediate appellate courts whether New York courts have subject matter jurisdiction over petitions to dissolve foreign business entities. Learn more in this week’s New York Business Divorce.
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Continue Reading Appellate Rulings Clash Over Subject Matter Jurisdiction to Dissolve Foreign Business Entities

This week’s New York Business Divorce features a recent decision by Justice Bernard Fried granting dissolution of an LLC owned 50-50 by two members locked in several highly contentious lawsuits. The decision addresses standing of a membership interest assignee to seek dissolution, and whether deadlock can establish ground for dissolution of a passive investment holding company.
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Continue Reading Court Grants 50% LLC Member’s Petition for Judicial Dissolution of Passive Holding Company

Can corporate dissolution cases be brought in federal court when there’s diversity of citizenship among the shareholders and the corporation? Get the answer in this week’s New York Business Divorce.
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Continue Reading Can Corporate Dissolution Proceedings Be Brought in Federal Court?

A majority shareholder’s breach of fiduciary duty owed a minority shareholder may constitute oppressive action within the meaning of the judicial dissolution statute. But does oppressive conduct constitute breach of fiduciary duty? A recent federal court decision suggests so, but is it right? Read this week’s New York Business Divorce and see for yourself.
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Continue Reading Fiduciary Breach Can Result in Shareholder Oppression, But Is Shareholder Oppression a Breach of Fiduciary Duty?

Common law dissolution is something of a remedy of last resort for the oppressed minority shareholder who does not hold the requisite 20% of the corporation’s voting shares to bring a dissolution proceeding under BCL Section 1104-a. This week’s New York Business Divorce highlights a recent decision by Queens County Commercial Division Justice Orin Kitzes ordering a hearing to determine a common law dissolution petition brought by 15% shareholders of a restaurant business.
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Continue Reading Court Orders Hearing On Minority Shareholder’s Petition for Common Law Dissolution

Mediation has become an important and increasingly popular alternative path to dispute resolution. This week’s New York Business Divorce features an interview with former law professor turned mediator Leona Beane on the subject of the mediation of business divorce cases.
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Continue Reading Mediation and Business Divorce: Interview with Mediator Leona Beane

When a claim for judicial dissolution is denied or otherwise drops out of the case, that doesn’t necessarily mean the case is over. This week’s New York Business Divorce discusses two recent decisions by Justices Patricia Satterfield and Shirley Werner Kornreich in which the side opposing dissolution prevailed but left unresolved other claims addressing the parties’ underlying differences.
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Continue Reading Winning the Dissolution Battle, Losing the War