This week’s New York Business Divorce touches on familiar themes. A bitter father-son dispute. A disagreement over whether to sell or keep the business. An expulsion and compelled buyout. Throw in a fistfight, criminal charges, and an alleged extortion in exchange for reduced criminal charges, and you’ve got one heck of a sordid story. There’s even a legal lesson about the importance of strict compliance with closing deadlines in buy-sell option agreements.
Continue Reading Dollars, Donuts, and Buy-Sell Options
Special Considerations for Law Firm Breakups
Just a few weeks ago, I commented on a recent uptick in disputes centered on the breakup of professional services firms. In those disputes, we expect that the demands of the legal, accounting, and medical professions draw individuals with keen attention to detail, focused on documentation, and prepared for all contingencies. Less expected is the irony that many attorneys, accountants, and medical professionals fail to bring those attributes to the table when organizing their business relationships.
The result of that failure is a tinderbox—poorly defined “partnership” relationships, mixed with high profit margins, difficult to value businesses, and type A owners willing to litigate their disputes. The right spark triggers bitter and hotly contested litigation. That part-legal, part-psychological phenomenon explains why business divorces of professional services corporations—especially law firms—can get complicated fast.
Motivated by that uptick, Becky Baek and I were pleased to recently present a CLE on the complexities that arise in the dissolution or breakup of law firms. Here are the highlights.Continue Reading Special Considerations for Law Firm Breakups
Dissolution Undone
Business divorce and non-judicial dissolution of a business entity rarely cross paths. This week’s New York Business Divorce highlights recent cases involving efforts to rescind improperly filed certificates of dissolution of LLCs.
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Fair Value Decision Caps Decade-Long Dispute Over Family-Owned Real Estate Holding Companies
This week’s New York Business Divorce post features a decision after valuation trial nine-years in the making, determining the fair value of a 50% interest in two family-owned real estate holding companies
Court of Appeals Bolsters the Internal Affairs Doctrine, Takes a Stroll Through Scottish Fiduciary Law
It’s not every day that New York’s highest court considers a question impacting the business divorce cases that we typically litigate. But a recent decision from the Court of Appeals requires careful consideration by any owner of a foreign-incorporated entity considering New York litigation.
Continue Reading Court of Appeals Bolsters the Internal Affairs Doctrine, Takes a Stroll Through Scottish Fiduciary Law
It Takes More Than a Litigation Tsunami Between Hostile Members to Obtain Judicial Dissolution of a Realty-Holding LLC
A recent Commercial Division decision illustrates anew the elevated challenge of suing for judicial dissolution of a viable realty-holding company — even when the estranged co-members are already immersed in multiple litigations. Read about it in this week’s New York Business Divorce.
Continue Reading It Takes More Than a Litigation Tsunami Between Hostile Members to Obtain Judicial Dissolution of a Realty-Holding LLC
Oral Joint Ventures: The Wild West of Business Associations
Oral joint venture agreements tend to be the murkiest, easiest to allege, and difficult to disprove of all closely-held business relations. Learn more in this week’s New York Business Divorce.
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When Law Firms Break Bad: The Valuation Battle Over Contingency Fees and Crypto Tokens
A law firm with high-upside contingency-fee cases that accepted payment in cryptocurrency tokens might be one of the most difficult companies to value. This week’s post explores a recent SDNY decision on such a company.
Continue Reading When Law Firms Break Bad: The Valuation Battle Over Contingency Fees and Crypto Tokens
You Get What You Get, and You Don’t Get Upset: First Department Boots Limited Partner’s Claims Based on Plain Terms of Limited Partnership Agreement
This week’s New York Business Divorce showcases how courts reign in aggrieved limited partners whose demands stray from the plain terms of the limited partnership agreement
Continue Reading You Get What You Get, and You Don’t Get Upset: First Department Boots Limited Partner’s Claims Based on Plain Terms of Limited Partnership Agreement
Limo Company Shareholders Can’t Hitch a Ride in Derivative Litigation
In this week’s New York Business Divorce, read about the intervention rules and some of the challenges they pose for closely-held business owners hoping to intervene in derivative litigation.
Continue Reading Limo Company Shareholders Can’t Hitch a Ride in Derivative Litigation