Recap of the VSCPA Business Valuation, Fraud, and Litigation Services Conference
Timely topics include how BVFLS experts are accounting for the impact of COVID-19, reviewing a valuation report, an estate/trust update, and a new idea to boost your practice. This two-day event was sponsored by the Virginia Society of CPAs (VSCPA).
How can you get BV CPD during COVID-19?
The short answer is ‘virtual.’
Despite COVID-19 and Brexit, the UK minted six new unicorns in 2020
CBInsights has updated its 2020 summary, showing that 76 private startups achieved unicorn status (a unicorn is a private company that has a valuation of more than $1 billion) last year, including six from the UK.
Plaintiff Fails to Convince the Court That Physical Loss or Physical Damage Has Occurred; Virus Clause Applies and Defendant’s Motion to Dismiss Is Granted
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court grants motions of the defendant to dismiss claims of the plaintiff. The plaintiff files claims for coverage under its insurance policy for losses resulting from COVID-19 shutdowns and seeks to establish a class. The court decides that coverage is not provided under the policy because there is no physical loss; the civil authority provision is likewise not effective, and there is a virus exception that is applicable to the case at hand.
What do KPMG and BDO have to say about current valuation and forecasting approaches?
COVID-19 dominates a lot of the discussion in the latest edition of KPMG’s 3Q2020 International Valuation Newsletter (IVN), though, as editors Johannes Post and Rolf Langenegger note, it ‘is not the only issue.’ BVWire—UK readers looking for a good summary of the effects the pandemic has had on UK and global markets should turn here, even though the effects on private companies, the LSE, and other markets are now familiar to everyone.
AFM Mattress Co. v. Motorists Commercial Mutual Insurance Company
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court grants a motion to dismiss claims of plaintiff. While plaintiff claims losses due to COVID-19, it does not sufficiently move the court to consider the virus exclusion of the policy inapplicable. A motion for a sur-response to espouse an alternative theory was also denied but without prejudice.
Appellate Court (Wisconsin) Affirms Trial Court Allocation of Tax Liability and Business Value in Divorce
The husband appealed the circuit court’s decision regarding his divorce decree and an order denying his motion to reconsider issues regarding the parties’ property division. He argued the circuit court erred in allocating less than half of the parties’ tax liability to the wife. He also argued the circuit court erred in denying his motion to reopen evidence regarding the impact of COVID-19 on his salon business. The appellate court rejected his arguments and affirmed the circuit court.
More resources for business valuers completing valuation engagements now
To help support the inquiries we’ve been receiving from our customers about how to address the coronavirus in the valuations they are working on, BVR has created a new COVID-19 business valuation resource website where we offer links to current news, past articles and webinars, third-party articles, and more to help BVWire—UK readers.
Family Tacos, LLC v. Auto Owners Ins. Co.
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court grants motions of the defendant to dismiss claims of the plaintiff. The plaintiff files claims for coverage under its insurance policy for losses resulting from COVID-19 shutdowns and seeks to establish a class. The court decides that coverage is not provided under the policy because there is no physical loss; the civil authority provision is likewise not effective, and there is a virus exception that is applicable to the case at hand.
Global BV News: VRG releases free webinar on global valuation impacts of COVID-19
A spotlight on pandemic-related market developments in China and Hong Kong, India, Spain, and the U.S. is available as a free webcast from Valuation Research Group.
In re Marriage of Gill
The husband appealed the circuit court’s decision regarding his divorce decree and an order denying his motion to reconsider issues regarding the parties’ property division. He argued the circuit court erred in allocating less than half of the parties’ tax liability to the wife. He also argued the circuit court erred in denying his motion to reopen evidence regarding the impact of COVID-19 on his salon business. The appellate court rejected his arguments and affirmed the circuit court.
Court Says Plaintiff Fails to State Plausible Claim to Relief for COVID-19-Related Losses but Allows Amendment of Complaint
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court says the plaintiff, a California restaurant, failed to state plausible claims to relief but gives plaintiff an opportunity to amend its complaint, even if “it does not seem likely” the plaintiff will be able to overcome the complaint’s deficiencies.
Protégé Rest. Partners LLC v. Sentinel Ins. Co.
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court says the plaintiff, a California restaurant, failed to state plausible claims to relief but gives plaintiff an opportunity to amend its complaint, even if “it does not seem likely” the plaintiff will be able to overcome the complaint’s deficiencies.
Follow-up comments: How to deal with COVID-19 for Dec. 31, 2019, valuations
Harold Martin (Keiter) has the following additional comments regarding the appraisal discussed in last week’s BVWire article dealing with a valuation date of Dec. 31, 2019, and whether the impact of the coronavirus should be considered a subsequent event.
Graspa Consulting v. United Nat’l Ins. Co.
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court dismisses plaintiff’s (a restaurant chain owner/operator) claims against insurance company; plaintiffs did not incur (nor did it assert) physical damages to premises as required by the terms of the insurance policy.
Specialty pharmacies resilient amid COVID-19
The pandemic had less of an impact on specialty pharmacies than other types of entities, say speakers on a recent BVR webinar.
Court Finds Insurance Policies Are Not Ambiguous as to ‘Physical Loss’ Requirement and Dismisses Plaintiffs’ COVID-19-Related Damages Claims
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court grants the defendant insurance company’s motion to dismiss plaintiffs’ complaint seeking coverage for lost business income under their insurance policies. Plaintiffs operated a hotel and adjacent banquet and catering facility. In ruling against the plaintiffs, the court found the virus did not perceptibly harm the properties and the policies included a virus exclusion that prevented coverage of business losses.
Court Rejects Plaintiffs’ Argument That Policy Covered Loss of Full Use of Premises Due to COVID-19-Related Shutdowns and Grants Defendant’s Motion to Dismiss
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court granted defendant insurer’s motion to dismiss the plaintiffs’ claims. The court found the plaintiffs, which operated restaurant and bar facilities in Ohio but had to suspend operations because of the pandemic, did not meet the precondition of “direct physical loss of or damage to” the covered property requirement. Further, the microorganism exclusion precluded coverage of losses.
Court Declines Motion to Dismiss Claim of Coverage for Loss of Income, but Dismisses the Claim of Coverage Under the Civil Authority Provision
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court declined to grant a motion to dismiss the claim of plaintiff as to coverage for loss of business income but does dismiss the claim of coverage under the civil authority provision of the policy. The court found the wording of the policy sufficiently vague, especially as to the meaning and definition of the word “loss.” In the case of the civil authority provision of the policy, the court decided that plaintiff has not alleged that “[a]ccess to the area immediately surrounding the damaged property is prohibited by civil authority.”
Brunswick Panini’s v. Zurich Am. Ins. Co.
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court granted defendant insurer’s motion to dismiss the plaintiffs’ claims. The court found the plaintiffs, which operated restaurant and bar facilities in Ohio but had to suspend operations because of the pandemic, did not meet the precondition of “direct physical loss of or damage to” the covered property requirement. Further, the microorganism exclusion precluded coverage of losses.
How BVR Is Helping to Keep You Connected During Coronavirus
As the world continues to feel the crippling effects of coronavirus, we can’t help but observe the ingenuity and compassion that citizens are showing for their communities. Musicians are hosting live concerts on social media, online subscriptions are discounted left and right, and events all over the world are transforming to webcast versions for all to utilize. We are entering an era of adaptation in a way the world has never seen—and BVR is here for it. Here are some ways BVR is supporting the valuation community during this unpredictable, uncertain time.
Equity Planning Corp. v. Westfield Ins. Co.
In this business interruption case resulting from mandatory restrictions to control COVID-19, the court grants a motion to dismiss claims of the plaintiff. The plaintiff’s arguments that it suffered physical loss or damage to its properties did not sway the court. Nor did its arguments that the civil authority provisions and virus exclusion in the policy were not applicable to deny its claims.
MIKMAR, Inc. v. Westfield Ins. Co.
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court grants the defendant insurance company’s motion to dismiss plaintiffs’ complaint seeking coverage for lost business income under their insurance policies. Plaintiffs operated a hotel and adjacent banquet and catering facility. In ruling against the plaintiffs, the court found the virus did not perceptibly harm the properties and the policies included a virus exclusion that prevented coverage of business losses.
Derek Scott Williams PLLC v. Cincinnati Ins. Co.
In this business interruption case resulting from mandatory shutdowns to control COVID-19, the court declined to grant a motion to dismiss the claim of plaintiff as to coverage for loss of business income but does dismiss the claim of coverage under the civil authority provision of the policy. The court found the wording of the policy sufficiently vague, especially as to the meaning and definition of the word “loss.” In the case of the civil authority provision of the policy, the court decided that plaintiff has not alleged that “[a]ccess to the area immediately surrounding the damaged property is prohibited by civil authority.”
Healthcare Valuation in the Corona Virus Era: That Was Then, This Is Now
COVID-19 has impacted perhaps no industry in such a complex way as healthcare. Join Mark Dietrich in this discussion of items to consider before you forecast the likely impact on the healthcare industry of the current crisis. First, it is necessary to understand where the industry was before COVID-19 and then to understand what the crisis revealed about the allocation of resources. Second, you need to consider where future spending will be directed and how ...