Here’s a sampling of new cases where issues of business valuation, damages calculations, or other analyses by financial experts and business appraisers was crucial to the outcome. The digests and court opinions of all such cases are all available at BVLaw.
In re Southern Peru Copper Corp., 2011 WL 4907799 (Del. Ch.)(Oct. 15, 2011)
Delaware Chancery finds merger process and price tainted by “relative” DCF valuations that obscured “real world” market values, and orders $1.3 billion in damages, based on its own calculation of DCF of acquired company.
Experts: Daniel Beaulne (plaintiffs); Eduardo Schwartz (defendants)
Court: Chancery Court
Type of case: breach of fiduciary duty
SIC code: 1099 Miscellaneous Metal Ores, NEC
Dixon v. Crawford, McGilliard, Peterson & Yelish, 2011 WL 4348058 (Wash. App. Div. 1)(Sept. 19, 2011)
Appellate court affirms goodwill value of a dissociated law partner’s interest in a well-established public defense firm under the capitalization of excess earnings method.
Experts: Joe Lawrence (plaintiff); James Weber, Steve Kessler, and Ronald Nelson
Court: Court of Appeals
Type of case: judicial dissolution
SIC code: 8111 Legal Services
In re Marriage of Bauer, 2011 WL 4337093 (Cal. App. 4 Dist.)(Sept. 16, 2011)(unpub.)
Appellate court upholds Business Reference Guide rules of thumb for valuing a physical therapy practice at 1.0 times gross income.
Experts: S.M. Zamucen (joint expert); David Hanzich (wife)
Court: Court of Appeals
Type of case: marital dissolution
SIC code: 8049 Offices and Clinics of Health Practitioners, NEC (physical, occupational, recreational and speech therapists, and audiologists
Felman Production, Inc. v. Industrial Risk Insurers, 2011 WL 4543960 (S.D. W. Va.)(Sept. 29, 2011)
Court dismisses claim for business interruption losses because neither the plaintiff nor its experts could prove an actual lost sale or lost sale opportunity caused by the damaged equipment.
Experts: Brad Murlick
State/Jurisdiction: federal/West Virginia
Court: U.S. District Court
Type of case: breach of contract
SIC code: 3312 Steel Works, Blast Furnaces (Including Coke Ovens), and Rolling Mills (coke ovens)
Estate of Gallagher v. Commissioner, 2011 WL 4809106 (U.S. Tax Court)(Oct. 11, 2011)
Tax Court corrects a previous error in the present value factor used to value an 80% interest in a privately held limited partnership, resulting in a $3.2 million increase in overall value.
Experts: Richard May (taxpayer) and John Thomson (IRS)
Court: Tax Court
Type of case: federal tax
SIC code: 2711 Newspapers: Publishing, or Publishing and Printing (except Internet newspaper publishing)