Welcome to the 12th annual edition of Summer Shorts. This year’s edition features brief commentary on a handful of recent decisions by New York trial judges and appellate courts in a variety of business divorce cases...more
In 1950, Sam Hoffman and his two sons, Hyman and Melvin, founded Brooklyn-based Cornell Beverages, Inc. to manufacture and distribute seltzer. Those were the days when “seltzer men” made weekly home deliveries of cases of...more
The pictured architectural rendering of the sunlit Kings County Supreme Courthouse at 360 Adams Street, completed in 1957, doesn’t quite capture the reality of its dour, hulking presence in downtown Brooklyn. Its design...more
7/5/2022
/ Breach of Duty ,
Business Disputes ,
Business Divorce ,
Business Litigation ,
Corporate Waste ,
Derivative Suit ,
Fiduciary Duty ,
Limited Liability Company (LLC) ,
Misappropriation ,
Ownership Interest ,
Shareholders ,
Standing
If you ask me to name the most common skirmishes over the adequacy of pleadings at the outset of business divorce litigation, at or near the top of the list are motions to dismiss a dissident owner’s direct claims that should...more
Appearances can be deceiving. -
That, essentially, was the argument made in two recently decided cases involving claims for judicial dissolution. ...more
11/15/2021
/ Breach of Duty ,
Business Disputes ,
Business Divorce ,
Business Litigation ,
Contract Terms ,
Employment Contract ,
Fraudulent Conveyance ,
Judicial Dissolution ,
Limited Liability Company (LLC) ,
Membership Interest ,
Operating Agreements ,
Purchase Price ,
Stock Transfer ,
Unjust Enrichment
If ever there was a ticking time bomb of a family-owned, closely held business more likely to result in business divorce litigation than the one in Matter of Brady v Brady, 2021 NY Slip Op 02705 [4th Dept Apr. 30, 2021], I...more
10/25/2021
/ Books & Records ,
Business Disputes ,
Business Divorce ,
Business Ownership ,
Closely Held Businesses ,
Declaratory Relief ,
Derivative Complaint ,
Derivative Suit ,
Family Businesses ,
Judicial Dissolution ,
Share Transfer ,
Shareholder Oppression ,
Stock Ownership
It’s not surprising that Vice Chancellor Zurn’s recent, first-impression decision in In re Coinmint, LLC, aligning itself with rulings in many other states including New York, found that Delaware courts lack subject matter...more
9/7/2021
/ Acquiescence ,
Bitcoin Mining ,
Business Disputes ,
Business Divorce ,
Corporate Conversions ,
Equitable Defenses ,
Estoppel ,
Foreign Entities ,
Judicial Dissolution ,
Limited Liability Company (LLC) ,
Membership Interest ,
Operating Agreements ,
Puerto Rico ,
Subject Matter Jurisdiction
Managing members of manager-managed New York LLCs owe default fiduciary duties of loyalty and care to non-managing members. Those duties can be modified by the operating agreement....more
Fine dining and business divorce crossed paths in a recently decided case featuring a lengthy battle between co-equal ownership factions of the corporation that operates Delmonico’s, the renowned Manhattan restaurant...more
New York’s Business Corporation Law (BCL) provides three pathways for non-controlling shareholders to achieve involuntary (judicial) dissolution. ...more
LLC enabling legislation swept the country in the late 1980s through the mid 1990s. By the turn of the century we saw a trickle of litigation working its way through the courts involving disputes among LLC co-owners. A decade...more
Article 12 of New York’s Limited Liability Company Law authorizes the formation of professional service limited liability companies (PLLC). Eligible professions include lawyers, medical doctors, accountants, architects, and...more
I’ve yet to see him make a court appearance, and hope I never do, but the Grim Reaper sure has a knack for disrupting business divorce litigation involving LLCs and limited partnerships....more
2/10/2020
/ Assignments ,
Automatic Stay ,
Breach of Duty ,
Business Disputes ,
Business Divorce ,
Business Litigation ,
Commercial Court ,
Controlling Person ,
Decedent Protection ,
Derivative Suit ,
Dissolution ,
Family Businesses ,
Fiduciary Duty ,
Fraud ,
Limited Liability Company (LLC) ,
Limited Partnerships ,
Ownership Interest ,
Partnership Interests ,
Partnerships ,
Real Estate Market ,
Statutory Interpretation ,
Transfer of Control ,
Unfair Dealing
In the last two years, fueled by a series of high profile cases involving media executives, entertainers, and other public figures, #MeToo has gained worldwide recognition as a symbol of the burgeoning movement against sexual...more
Shareholders A and B are the sole shareholders of a real estate holding corporation. Their shareholders’ agreement includes provisions that...more
The East River and roughly five miles as the pigeon flies separate the equally beautiful courthouses of the Appellate Division, Second Department in Brooklyn and the Appellate Division, First Department in Manhattan. Because...more
I’ve said it before, I’ll say it again: for professionals who dwell in the world of LLCs, whether as transactional, tax, or litigation counsel, attending the annual, two-day LLC Institute, sponsored by the LLCs, Partnerships...more
Board members’ decisions to award compensation packages for themselves can present some thorny issues. In a close corporation, shareholders typically serve as officers and directors, and have a reasonable expectation of...more
The Chancery Court of Delaware is considered by many to be the most influential U.S. court when it comes to business law, mostly due to that state's dominant role as the preferred state of incorporation of publicly held...more