A recent First Department decision recognizing a cause of action for shareholder oppression raises big questions in the area of minority shareholders’ rights.
Continue Reading A New Stile: First Department Shakes Up the Shareholder Oppression Claim
First Department
Fee Sharing in LLC Derivative Suits: A Common Law Right and a One Way Street

In the wild west of LLC derivative lawsuits, the First Department’s recent decision in Bd. of Managers of 28 Cliff St. Condominium v Maguire, 2020 NY Slip Op 06844 [1st Dept Nov. 19, 2020] offers—albeit indirectly—an additional foothold for a successful plaintiff to assert his right to recover his fees from an award in favor of the LLC.
Continue Reading Fee Sharing in LLC Derivative Suits: A Common Law Right and a One Way Street
Departing LLC Members: Exercise Your Put Option Before Insolvency Approaches

Can an LLC member with a put option–the right to sell his interest back to the LLC–exercise that option when doing so will render the LLC insolvent? This week’s New York Business Divorce post highlights a recent decision by Justice Masley of the New York County Commercial Division considering this issue. …
Continue Reading Departing LLC Members: Exercise Your Put Option Before Insolvency Approaches
LLC Survives Member’s Death. Dissolution Petition Doesn’t.

Last week, the Appellate Division affirmed an order dismissing an unusual LLC dissolution petition based on the death of one of its members — 11 years earlier. Get the full story in this week’s New York Business Divorce.
Continue Reading LLC Survives Member’s Death. Dissolution Petition Doesn’t.
Operating Agreement Spawns Multiple Disputes Between 50/50 Members of Realty Holding LLC

Entering its fifth year of litigation featuring two rulings by the Appellate Division in 2017 and last week, the case of Rubin v Baumann is another example of LLCs that suffer from inadequate operating agreements. Learn more in this week’s New York Business Divorce. …
Continue Reading Operating Agreement Spawns Multiple Disputes Between 50/50 Members of Realty Holding LLC
Dead Men Tell No Tales of Shareholder Buy-Outs Gone Sour

An eight-year litigation saga in a dispute over a below-market sale of shares in a realty holding company came to end last month when the Appellate Division, First Department, affirmed an order dismissing the complaint in Gourary v Laster. Read more in this week’s New York Business Divorce.
Continue Reading Dead Men Tell No Tales of Shareholder Buy-Outs Gone Sour
Anyone Think Binding Mediation to Break Deadlock Is a Good Idea?

This week’s New York Business Divorce analyzes the use of binding mediation to resolve deadlock between 50/50 business owners, a device whose use was affirmed on appeal in a decision last week by the Appellate Division, First Department.
Continue Reading Anyone Think Binding Mediation to Break Deadlock Is a Good Idea?
Appeals Court Reinstates Derivative Claims Dismissed for Conflict of Interest Where Parties’ Relationship Not “Especially Acrimonious”

Last year, in Pokoik v Norsel Realties, the trial court cited the plaintiff’s “litigious nature” and personal animus in dismissing his derivative claims based on conflict of interest. You’ll be interested to learn in this week’s New York Business Divorce that an appellate panel last week reversed the decision and reinstated the claims based on its finding that the parties’ relationship was not “especially acrimonious.”…
Continue Reading Appeals Court Reinstates Derivative Claims Dismissed for Conflict of Interest Where Parties’ Relationship Not “Especially Acrimonious”
Delaware Contractarian Principles Prevail in Appeal Over Deceased Ace Hotel Founder’s LLC Interest

It’s better to burn out than to fade away. But what happens when death converts an LLC interest from full membership rights to mere assignee status? Read on in this week’s New York Business Divorce.
Continue Reading Delaware Contractarian Principles Prevail in Appeal Over Deceased Ace Hotel Founder’s LLC Interest
A River’s Divide: Time for the Manhattan and Brooklyn Appellate Courts to Agree on Marketability Discount in Fair Value Proceedings

Should courts apply a marketability discount in determining the fair value of interests in realty holding companies? In downstate New York, the answer may vary depending on whether the court lies within the First or Second Departments of the Appellate Division. This week’s New York Business Divorce has the story. …
Continue Reading A River’s Divide: Time for the Manhattan and Brooklyn Appellate Courts to Agree on Marketability Discount in Fair Value Proceedings