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?
Is there such a thing as a contractually-infused, common-law fiduciary duty that can override an LLC manager’s “sole and absolute discretion”? Decide for yourself when you read this week’s New York Business Divorce.
Continue Reading When an LLC Manager’s “Sole and Absolute Discretion” is Neither Sole Nor Absolute
This 9th annual edition of Summer Shorts presents brief commentary on four decisions of interest in business divorce cases from courts in New York, California, Delaware, and Illinois.
Continue Reading Summer Shorts: LLC Minority Member Oppression and Other Decisions of Interest
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
Ill-fated hardly begins to describe the legislatively doomed LLC involved in the lawsuit featured in this week’s New York Business Divorce. You won’t want to miss it.
Continue Reading Outlawing of LLC’s Short-Term Rental Business Brings Long-Term Litigation
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?
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.
Continue Reading And the Award For Most Oppressive Conduct By a Majority Shareholder Goes to . . .