Court’s Fair Value Determination Leans Heavily on Expert’s Fair Market Valuation Premised on Liquidation

BVLaw
Court Case Digests
November 18, 2020
6719 Offices of Holding Companies, NEC
551112 Offices of Other Holding Companies
judicial dissolution
expert testimony, fair value, discounted cash flow (DCF), discounts & premiums, fair market value (FMV), limited liability company, real estate, forced buyout, holding company, dissolution, direct capitalization of cash flow analysis

Finkel v. Palm Park, Inc.
2020 NCBC 84
US
State Court
North Carolina
North Carolina Superior Court
Jerry L. Wilcoxon (BV, defendants); Frank D. Leatherman Jr. (joint real estate appraiser)
McGuire

Summary

In LLC member dispute, court faces “conundrum” where fair value buyout seeks to avoid LLC’s dissolution and court leans on expert’s FMV valuation using net asset value approach premised on “orderly liquidation”; court notes FMV is based on hypothetical actors and transaction, not specific parties.

See Also

Finkel v. Palm Park, Inc.

In LLC member dispute, court faces “conundrum” where fair value buyout seeks to avoid LLC’s dissolution and court leans on expert’s FMV valuation using net asset value approach premised on “orderly liquidation”; court notes FMV is based on hypothetical actors and transaction, not specific parties.

This article also appears in:
Business Valuation UpdateVol. 27 No. 2