You know you’re in big trouble if the post-trial decision in a lawsuit you filed begins like this:
“The court finds the plaintiff, Rowen Seibel, not credible. This is primarily because it appears he fabricated evidence...more
A number of lawsuits have percolated through New York’s courts over the past five years between Adam Max, son of world-renowned visual artist Peter Max, and Adam’s sister, Libra, over control and management of the family...more
5/23/2022
/ Breach of Duty ,
Business Disputes ,
Business Divorce ,
Business Judgment Rule ,
Derivative Suit ,
Exculpatory Clauses ,
Family Businesses ,
Fiduciary Duty ,
Fine Art ,
Hostile Takeover ,
Negligence ,
Personal Liability
It’s hard not to feel sorry for the petitioner in Fernandes v Matrix Model Staffing, Inc., Decision and Order, Index No. 160294/2021 [Sup Ct, NY County Apr. 20, 2022].
In Fernandes, Manhattan Supreme Court Justice Frank...more
Closely-held business owners often hope to avoid the costs and delays of litigation by including arbitration provisions in their partnership, shareholder, and operating agreements. Things can get tricky, though, when...more
In Congel v Malfitano, New York’s highest court wrote that business partners are free to include in partnership contracts practically “any agreement they wish,” including about “the means by which a partnership will dissolve,...more
3/14/2022
/ Appeals ,
Business Divorce ,
Closely Held Businesses ,
Contract Disputes ,
Contract Terms ,
Delaware General Corporation Law ,
Dissolution ,
Judicial Dissolution ,
Limited Liability Company (LLC) ,
Operating Agreements ,
Partnership Agreements ,
Public Policy
Justice Masley’s valuation decision in Quattro Parent LLC v Rakib, 2022 NY Slip Op 30190(U) [Sup Ct, NY County Jan. 14, 2022] is noteworthy for two reasons.
First, it is an extraordinarily rare example of a business...more
Generally speaking, New York courts respect the corporate form, regarding the liabilities of the entity as separate from and inapplicable to the entity’s principals. Under this principle, a plaintiff may litigate a difficult...more
Two years ago, Peter Mahler wrote about a dissolution lawsuit by a female minority shareholder alleging that her male co-shareholders condoned a pattern of sexually offensive and demeaning conduct by a senior co-worker, which...more
11/29/2021
/ #MeToo ,
Breach of Duty ,
Business Divorce ,
Business Judgment Rule ,
Business Litigation ,
Closely Held Businesses ,
Corporate Culture ,
Corporate Waste ,
Derivative Complaint ,
Dissolution ,
Fiduciary Duty ,
Harassment ,
Sexual Harassment ,
Shareholder Oppression ,
Summary Judgment
The harried realities of modern life are such that business entity organizational documents, like LLC operating agreements, sometimes do not get drafted or executed until long after the entity’s initial formation with the...more
Ownership status in a closely-held business is the first and most vital box almost every business divorce petitioner must check....more
10/11/2021
/ Business Divorce ,
Business Litigation ,
Business Ownership ,
Closely Held Businesses ,
Dissolution ,
Estoppel ,
Evidence ,
Family Businesses ,
Limited Liability Company (LLC) ,
Litigation Strategies ,
Partnerships ,
Proof of Ownership ,
Tax Returns ,
Trial Preparation
Most folks associate beer with pleasure. Many craft brewers will tell you they went into business for that reason: to make themselves and others happy (and, oh yeah, make money). ...more
9/13/2021
/ Breach of Contract ,
Breach of Duty ,
Breweries ,
Business Divorce ,
Business Litigation ,
Dilution ,
Freeze-Out Mergers ,
Limited Liability Company (LLC) ,
Membership Interest ,
Motion To Enjoin ,
Operating Agreements ,
Preliminary Injunctions ,
Startups
In an article from a little over a month ago, we summarized New York’s LLC judicial dissolution statute with the comment, “Breaking up can be hard to do.”...more
Recently, we’ve written two articles focusing on the brewing dispute over whether New York law recognizes a viable cause of action for “common-law” or “equitable” dissolution of a limited liability company....more
Unless you’ve been living under a rock, you’ve probably heard that a little over two months ago, New York State Governor Andrew M. Cuomo signed legislation reform advocates and stoners alike have dreamt of for decades,...more
7/6/2021
/ Breach of Contract ,
Business Disputes ,
Business Divorce ,
Contract Terms ,
Decriminalization of Marijuana ,
Emerging Growth Companies ,
Investment Opportunities ,
Letters of Intent ,
Marijuana ,
Marijuana Related Businesses ,
Partnership Agreements ,
Partnerships ,
Private Equity ,
Startups
Like the Energizer bunny, some business divorce lawsuits keep going and going and going. Years of protracted litigation, brutal though they may be upon the parties, are a bonanza for voyeuristic business divorce practitioners...more
Last week, Peter Mahler blogged about a recent decision holding that a minority shareholder’s claim against its majority co-owners for breach of fiduciary duty in connection with a sale of the business to a third party...more
In an earlier post, we wrote about a fascinating law firm limited liability partnership dispute culminating in a thoughtful post-trial decision by Erie County Commercial Division Justice Timothy J. Walker. Capizzi v Brown...more
Ten months ago, we wrote about an unusual case involving an LLC member who documented two irreconcilable membership interest transfers upon death. In Harris v Harris, 2020 NY Slip Op 31570(U) [Sup Ct, NY County Apr. 23,...more
Oral agreements to form and operate business enterprises are a recurring subject of this blog. We’ve written many times, for example, about the comparative ease vis-a-vis other kinds of entities with which one can...more
3/15/2021
/ Breach of Duty ,
Business Divorce ,
Business Formation ,
Business Litigation ,
Fiduciary Duty ,
Fraudulent Conveyance ,
Joint Venture ,
Operating Agreements ,
Oral Contracts ,
Partnership Agreements ,
Unjust Enrichment
Section 1007 of the Business Corporation Law (the “BCL”) has a procedure for dissolved corporations to publish “notice requiring all creditors and claimants . . . to present their claims in writing and in detail at a...more
In last week’s New York Business Divorce, Peter Mahler wrote about an important new decision with far-reaching implications for New York LLC owners....more
Business divorce clients often arrive in the throes of a crisis, complaining of co-owners siphoning, diverting, depleting, or denying access to company assets and resources for their own personal use or for the benefit of a...more
Many business divorce practitioners are familiar with a phenomenon one might call “petitioner’s remorse” – an often abrupt abandonment of one’s desire to dissolve a closely-held business entity when the opposing party...more
A recent decision from Bronx County Supreme Court Justice Llinet M. Rosado, Sebrow v Sebrow, 2020 NY Slip Op 20269 [Sup Ct, Bronx County Oct. 9, 2020], is a stark reminder to corporate shareholders, attorneys who plan their...more
If a written limited partnership agreement contains detailed provisions governing partner withdrawal and dissolution, can a court nonetheless look to the statutory “default rules” in the Revised Limited Partnership Act (the...more