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
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
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
In Jacobs v Cartalemi, now the leading case on the subject of LLC member withdrawal (which our firm had the pleasure of litigating), the Appellate Division – Second Department repeated a well-established principle of law:...more
Oral agreements – and oral modifications of written agreements – are a constant source of litigation in business divorce cases. Alleged oral agreements are subject to attack based upon legal enforceability – as well as their...more
8/24/2020
/ Business Disputes ,
Business Divorce ,
Contract Terms ,
Covered Transactions ,
Limited Liability Company (LLC) ,
Operating Agreements ,
Oral Argument ,
Partnership Agreements ,
Partnerships ,
Shareholders ,
Unenforceable Contract Terms
The mystique of the jury trial is deeply embedded in the social consciousness of our country. Non-lawyers who think of litigation tend to recall courtroom thrillers like To Kill a Mockingbird, Erin Brockovich, or...more
Corporate shareholder and LLC operating agreements routinely contain provisions addressing the transfer of equity interests upon the death of an owner of a closely-held business. Such provisions are vital for succession...more
6/8/2020
/ Business Continuity Plans ,
Business Divorce ,
Business Litigation ,
Business Succession ,
Closely Held Businesses ,
Contract Terms ,
Decedent Protection ,
Equity ,
Estate Planning ,
Limited Liability Company (LLC) ,
Operating Agreements ,
Ownership Interest ,
Probate
The ongoing coronavirus / COVID-19 pandemic has quite literally impacted everyone and everything in New York, including the courts, which were forced to temporarily cease non-essential functions. The result was a short-lived...more
We’ve written from time to time, about the need to allege pre-suit demand or demand futility where a shareholder seeks to sue derivatively on behalf of a corporation for whom the court has appointed a receiver....more
Business Divorce 101: To be entitled to an accounting of a closely-held business, the plaintiff or petitioner must demonstrate the existence of a fiduciary relationship giving rise to a duty to account....more
2/18/2020
/ Appeals ,
Business Divorce ,
Business Litigation ,
Closely Held Businesses ,
Commercial Court ,
Dissolution ,
Limited Liability Company (LLC) ,
Membership Interest ,
Pro Rata Allocation Rule ,
Shareholder Distributions ,
Standing
There are countless New York corporations in which the owners are equal 50/50 shareholders and co-members of a two-member board. Where one sues the other for judicial dissolution, and the ground for dissolution is “deadlock”...more
1/20/2020
/ Business Disputes ,
Business Divorce ,
Business Litigation ,
Corporate Deadlock ,
Corporate Dissolution ,
Counterclaims ,
Cross Motions ,
Dissenters Rights ,
Judicial Dissolution ,
Motion to Dismiss ,
Resignation ,
Right to Control ,
Shareholder Litigation ,
Shareholders ,
Sole Proprietorship
In litigation, the term “spoliation” generally refers to loss or destruction of evidence. Spoliation can involve physical evidence, paper documents, or electronic data. Spoliation can be intentional or unintentional....more
12/23/2019
/ Business Divorce ,
Business Litigation ,
Commercial Court ,
Contempt ,
Counterclaims ,
Discovery ,
Electronically Stored Information ,
Evidence ,
Judicial Dissolution ,
Misappropriation ,
Motion To Strike ,
Motions in Limine ,
Spoliation ,
TRO
Under the so-called “American Rule,” litigants usually must pay their own lawyer fees. But in business divorce and other private company disputes between business co-owners, there are a variety of ways for individual...more
Earlier this year, we wrote about a partnership dispute involving a prominent insurance litigation firm, D’Amato & Lynch, LLP. In that case, a lawyer who enjoyed the title and certain trappings of “partner” tried, but failed,...more