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Bankruptcy Court Uses Purchase Price Allocation to Determine Value

In the case of In Re S-Tek 1, LLC, the Bankruptcy Court utilized the purchase price allocation (PPA) as a reference to determine some of the values of specific assets as of the date of the purchase transaction, which led to some interesting results.

Court Rulings Have Big Impact on Fair Value

To sue or not to sue, that is the question! Learn more about a pair of court cases that have made a big impact on fair value as it relates to shareholder dissent suits.

Rule 702 and the Daubert Standard

Recently, another case has raised questions about what is and what is not admissible. In Auto Konnect, LLC v. BMW of N. Am., LLC; 2022 U.S. Dist. LEXIS 42345 *, the court allowed the testimony of a damages expert for the plaintiff who, according to the defendant, was not a CPA.

NFTs—Valuable Art, Worthless Gimmicks, or Something Else

NFTs are all the rage! Almost every day, I run into another article on the subject. In the context of what is going on today relative to NFTs, the token part is a digital unit of data stored on a blockchain that represents a digital asset or a physical asset.

Blue-Sky Method in Valuing a Car Dealer—Redux

In a recent issue of the BVLaw Alert, we published a short piece about a shareholder dissent/oppression appellate decision in Tennessee regarding the valuation of a “high-end” car dealership. Our headline noted, “Court Tweaks Blue-Sky Method in Valuing a Car Dealer.” We received a question from a reader asking whether the rule of thumb blue-sky method was explained in the case.

Delaware Chancery Case on Shareholder Dissent Likely to Raise Eyebrows

A recent opinion from the Delaware Court of Chancery is likely to raise eyebrows within the business valuation profession. Read on to find out why.

Do BV Standards Have Any 'Value' in Court?

Do business valuation standards have any value in court? Our legal editor shares insights gleaned from several cases on just this topic.

New Lease Accounting Rules Impact on Valuation

Lately, there have been discussions online about the impact of ASC 840 and 842 (rules on accounting for leases) on valuations of businesses. Let's take a look at how these changes pan out.

AICPA Issues a Bridging Document to the International Valuation Standards

The AICPA has issued a bridging document to move a VS100 valuation engagement to an IVS-compliant valuation engagement. Learn more about what this might mean for the BVLS field.

Subsequent Transaction Used to Find Damages Without Trial in New York Case

In this surmised summary judgment as to damages, a New York trial court awarded damages to the plaintiff in a breach of contract suit. The determination of damages was made without a trial but “on paper.” Additionally, the court used a subsequent sale of the stock to determine the damages and opine that the company was “worthless.”

Legal Firestorm Hits Delaware SPACs

Well a firestorm hit the legal world of special purpose acquisition corporations (SPACs) when the Delaware Court of Chancery (Lori W. Will, VC) denied motions to dismiss various allegations of some of the public stockholders of Churchill Capital Corp.

Divorce—Are Trapped-In Gains Trapped or Not?

Two new cases exemplify the need to know the law in the jurisdiction of your case in a marital dissolution (divorce).

BVLaw Questions – You Asked, We Answered!

The BVR legal team often receives inquiries about our method and “rules” behind our case law research and digesting process, so we're sharing this important background information with you.

New IRS Trap for GRATs When There Is a Merger Pending

The Chief Counsel office (IRS) recently released a memorandum, which comes to two primary conclusions. First, under the fair market value standard, the hypothetical willing buyer and willing seller of a company would consider a pending merger when valuing stock for gift tax purposes. Second, the retained interest is not a qualified annuity interest under § 2702 of the Internal Revenue Code (Code) because the donor used an outdated appraisal that did not take into account all the facts and circumstances of a pending merger.

Daubert Standard and FRE 702 Rejections on the Rise?

It appears that the courts are rejecting Daubert standard and FRE 702 challenges more frequently. Take a deep dive into potential reasons for this with our legal editor, Jim Alerding.

Demand for Forensic Litigation Professionals Creates Shortages

Lately, there has been chatter about the demand for experienced business valuation forensic litigation specialists exceeding the supply of such people.

Estate Planning Pitfalls

Estate planning can be a risky business. Some of those risks were on full display in a recent tax case, Nelson v. Comm'r.

Recent ESOP Ruling Changes the Game

Recently, a district court in Hawaii has ruled in favor of the trustees and sponsors in a case that is getting a lot of attention, Walsh v. Bowers, 2021 U.S. Dist. LEXIS 177184. The Department of Labor sued the defendants, which included two individual owners. read on to dive a little deeper into the details of this fascinating case!

Is Calculated Value Admissible in Court?

Recently a court in Arizona rejected the use of a calculation report, but an appellate court ruled it was wrong to do so and sent the case back to the lower court. The reasoning for this decision strikes at a broader question: is calculated value admissible in court?

DLOMs and DLOCs in Buyouts

The courts in the past few years have been sprinkled with cases dealing with whether a discount for lack of control (DLOC) or marketability (DLOM) should be applied in the case of a shareholder buyout.

ESOPs Are a Mine Fields for Valuation Analysts

The Department of Labor (DOL) has a long history of challenging transactions involving company owners selling some or all of their interests to an ESOP. The most common challenge is to the value the trustees approved for executing the sale of company stock held by owners to the ESOP.

Meet Jim Alerding BVR's New Legal Editor

Hi, I am Jim Alerding, CPA/ABV. Many of you know me from my presentations and articles over the years. I have over 40 years of experience in business valuation and litigation services. I started in 1980 in the BV and testimony arenas. Since my first case was a valuation for a divorce case in which I then testified, I started in BV and Litigation Support at the same time.

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