Defying my recent lamentation on the dearth of cases involving buy-out disputes where the buyer doesn’t disclose to the seller an outside offer for the entity’s assets at a much higher value, this week’s New York Business Divorce examines yet another such case with some interesting twists on the usual fact pattern.
Continue Reading Re-Revisiting The Duty to Disclose Third-Party Offers Amidst Buy-Out Negotiations

This week’s New York Business Divorce examines a recent decision in a lawsuit stemming from a buyout between the two members of a single-asset realty-holding LLC based on a $1.9 million valuation of the LLC’s realty followed one month later by a sale of the realty to a third-party buyer for $2.9 million.
Continue Reading The Duty to Disclose Third-Party Offers Amidst Buy-Out Negotiations, Revisited

Not all misconduct by majority shareholders is worthy of dissolution or a compelled buy-out. The Court’s broad power under BCL 1104-a to craft appropriate remedies also includes the power to award money damages, and dissolution may not be appropriate where the alleged shareholder oppression was a discrete, one-time transaction.
Continue Reading Court Rejects Oppressed Shareholder’s Bid for Dissolution or Buy-Out, Finds Money Damages Sufficient

In this week’s New York Business Divorce, read about the exceedingly versatile cause of action of breach of fiduciary duty and the many remedies courts may award upon a finding of breach. This week’s post focuses on two remedies in particular: disgorgement of profits obtained through self-dealing, and recovery of attorneys’ fees when pled derivatively.
Continue Reading The Common-Law Tort of Breach of Fiduciary Duty: The Total Package

In this week’s New York Business Divorce, we consider a remarkably thoughtful opinion by Commercial Division Justice Jennifer G. Schecter containing some noteworthy hints about the future of LLC dissolution claims in light of the coronavirus pandemic and its catastrophic economic impact on New York closely-held businesses.
Continue Reading Will the Pandemic Be a Boon for Future LLC Dissolution Claimants?

Matthew Donovan takes the helm in this week’s New York Business Divorce, writing about a recent Delaware Chancery Court decision finding that certain, shall we say, unusual behavior by a New York-based company’s co-founder, president and director breached fiduciary duty.
Continue Reading Throwing Grenades and Casting Plagues Upon Your Fellow Directors: A Lesson in Fiduciary (Ir)responsibility

It’s back! For the third week in a row, New York Business Divorce examines a decision by Manhattan Commercial Division Justice Saliann Scarpulla in a multi-faceted feud among members of the Yu family, this time requiring the court to balance the fiduciary duty owed by LLC managers against the right to amend the operating agreement without the consent of the affected minority member.
Continue Reading Does This Decision Put the Brakes on Non-Unanimous Amendments to Operating Agreements?