Insignia Systems, Inc. v. News America Marketing In-Store, Inc.
Federal district court denies Daubert challenge to plaintiff’s lost profits expert, finding his reliance on optimistic management projections and comparable companies were better suited for cross-examination rather than exclusion.
United States ex rel. Landis v. Tailwind Sports Corp.
In Daubert case, court finds government’s combined expert testimony concerning financial impact of negative publicity on sponsor (USPS) of Lance Armstrong and his cycling team provides “sufficiently non-speculative framework for determining damages.”
Projection Issues Raised in ESOP Litigation
Revenue growth rate, profit margins, and long-term growth rate can all meaningfully impact projections. Add in inconsistency with historical results, industry/economy impacts, and lack of adjustment for critical things such as compensation or capital expenditures, and it is easy to see how litigation can arise. Chip Brown, Chelsea Mikula, and Kyle Wishing help identify common issues raised in ESOP litigation cases (either by the Department of Labor or private plaintiffs) with respect to financial projections ...
Chesemore v. Alliance Holdings, Inc. (I)
: Federal district court makes extensive finding regarding breaches of fiduciary duties for ESOP trustees that caused company to enter heavily leveraged buyout despite falling forecasts and flawed valuations marred by manager conflicts of interest.
SSL Services, LLC v. Citrix Systems, Inc.
District court denies defendants’ post-trial challenge to $10 million jury award finding the fact that the patent assignee at the time of the hypothetical negotiation was worth less than its single patent-in-suit does not control the assessment of patent ...
How to Conduct an S Corp Valuation for the IRS Given IRS Internal Memorandums
Join Michael Gregory for a discussion on two recently obtained internal IRS memorandums so that you can work more effectively with the IRS on estate and gift tax valuations. These memorandums shed light on how the IRS approaches valuing S corporation valuations and what you need to consider when preparing an S corporation valuation for federal tax purposes. The memorandums recommend consideration of both Revenue Ruling 59-60 and the IRS Job Aid on Non-Controlling Interests.
Show Me the Money! The Exploration, Examination and Dissection of Reasonable Compensation
Poorly defined and highly subjective, reasonable compensation analysis is often both subject to, and the result of, highly contentious valuation disputes. In their presentation at the BVR/Morningstar 3rd Annual Summit on Business Valuation in Divorce, expert appraiser Kevin Yeanoplos and compensation specialist Edward Rataj examined how reasonable compensation analysis is performed, how it is disputed, and how it has come to be shaped by relevant case law. In this special encore presentation of their session ...
Estate of Turner v. Commissioner (I)
Tax Court includes full value of family limited partnership assets in the gross estate after finding that their nature (passive investments in cash and marketable securities) provided no legitimate, nontax reason for their consolidation or management.
Athlon Sports Communications, Inc. v. Duggan (II)
Court overrules precedent requiring exclusive use of Delaware block method to determine fair value in dissenting shareholder cases; trial courts may use other, more “modern” methods, including forward-looking DCF analysis, state high court says and remands for reevaluation of earlier ruling.
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.
Business Valuation Review Spring 2019
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Volume 38 Issue 1 Spring 2019 2 Letter from the Editor Victor E. Jarosiewicz, PhD, ASA, CFA, CAIA 5 Almost Forty Years of Business Valuation Review Victor E. Jarosiewicz, PhD, ASA, CFA, CAIA 11 Historical Articles (listed inside) 90 From the Chair Kenneth J. Pia, Jr., CPA, ABV, ASA, MCBA Q u a r t e r l y J o u r n a l o f t h e B u s i n e s s V a l u a t i o n C o m m i t t e e o f t h e A m e r i c a n S o c i e t y o f A p p r a i s e r s Published by the American Society of Appraisers Copyright © 2019 American Society of Appraisers Business Valuation Review™ – Spring 2019 The Business Valuation Committee Chair Kenneth J. Pia Jr., ASA – Marcum LLP Vice Chair Erin Hollis, ASA – Marshall ...
Select Court Opinions from BVLaw
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See select court opinions from the BVLaw database including Adams v. Commissioner, Estate of Andrews v. Commissioner, Bardahl Manufacturing Corp. v. Commissioner, and many more.
Valuing Distressed and Impaired Companies in the Time of Coronavirus
The Coronavirus Pandemic has created perhaps the most unusual economic downturn at least in our lifetimes and likely in the past 100 years. For Americans, the Pandemic stopped in its tracks one of the most explosive economic growth and expansion in many years, if ever. Overnight almost, businesses that were economically sound and growing were turned into distressed and impaired businesses. Jim Alerding will analyze the valuation perspective needed to value a distressed or impaired ...
Marketability Discounts for Controlling Interests: The Market Data Is Out There
Do you believe in DLOMs for controlling interests? Have you heard the competing theories? Do they make you nervous? Discover the evidence with expert Ron DiMattia. Examine the market data that support the theory that controlling interests lack liquidity. Be part of the discussion of the potential impact on the profession, and then decide whether you will change your DLOM direction.
Tyco Healthcare Group LP v. Ethicon Endo-Surgery, Inc.
District court finds damages expert’s model for reconstructing market and allocating share to plaintiffs based on a “but for” world, is too speculative to establish causation under the Panduit test and disallows lost profits; however, the court awards rea ...
Navigating Healthcare’s New Path: Valuing Care Coordination and Alternate Care Delivery Models
Care coordination and alternate care delivery models are more present than ever in healthcare. Care coordination involves deliberately organizing patient care activities and sharing information among all of the participants concerned with a patient's care to achieve safer and more effective care. Valuing these companies involves understanding the healthcare model, and the rules and pending regulations that may impact value. Join Jason Ruchaber for the rules, methods and examples you need to have to coordinate ...
Judges Roundtable: View From the Bench
In this very special presentation, BVR's 2011 Online Tax Summit welcomes Judges Laro, Jacobs, and Cohen of the United States Tax Court for their unique perspective on the court and what it expects from expert financial witnesses. Webcast live from the Georgetown Law Center and moderated by expert appraiser Jay Fishman, this presentation is perhaps the only setting where you can hear directly form these jurists on what they expect from attorneys and expert witnesses ...
BVR's Teleconference Series on Healthcare Valuation (Part 2 of 3)
BVR’s Teleconference Series on Healthcare Valuation (Part 2 of 3) Teleconference Handbook June 23, 2009 Panelist: Carol Carden, CPA/ABV ASA, CFE, Mark O. Dietrich, CPA, ABV, Douglas Smith, and Timothy Smith, CPA/ABV Please note: This Handbook does ...
Advanced Workshop on Cost of Capital
The emergence of recent studies, resources, and scholarship has created something of an evolution of how appraisers understand and implement cost of capital techniques. Despite the age and ubiquity of this valuation tool, new questions are being asked about how best to derive and apply its constituent parts to arrive at a reasonable and defensible conclusion of value. Driving the way are new questions regarding the make-up and application of data resources; the relative validity ...
A General Option Valuation Approach to Discount for Lack of Marketability
A general option-based approach to estimating the discount for lack of marketability is offered. It is general enough to capture maturity, volatility, hedging availability, and investor skill, as well as other important factors. The model is shown to contain several option-based models as special cases. The model also contains two weighting variables that provide valuation professionals much needed flexibility in addressing the unique challenges of each nonmarketable valuation assignment. Selected prior empirical results are reinterpreted ...
Warranting Further Discussion: Why the Use of Financing Warrants in ESOP Transactions Benefits American Workers
The leveraged Employee Stock Ownership Plan (ESOP) structure was created by US Congress to enable American workers to gain an equity interest in their companies without using their own funds. A critical component in the financing of leveraged ESOP transactions is a “warrant,” which enables corporate sponsors of ESOPs to access the financing necessary to facilitate purchases of company stock by ESOPs. Warrants also afford substantial benefits to ESOPs by providing downside risk for ESOP ...
In re PLX Tech. Stockholders Litig.
Chancery says plaintiffs proved directors breached fiduciary duties and duty to disclose but failed to prove damages; court rejects plaintiff expert's DCF analysis, noting problematic projections and beta; “real-world market evidence” shows company was not worth more than deal price.
Report of Business Valuation of Acme Forge, Inc. as of 04/27/2006
Report of Business Valuation of Acme Forge ...
In re Dole Food Co. (Dole III)
In joint fairness/statutory appraisal action, Chancery finds defendants’ fraud defeated financial advisor’s ability to produce reliable DCF, notwithstanding advisor’s “heroic” efforts to create “the most credible and reliable projections in the case.”
In re Appraisal of Columbia Pipeline Grp., Inc.
In statutory appraisal action featuring publicly traded company, court relies on deal price for fair value; although flawed, sale process, when compared to process in three key high court decisions endorsing deal price, does not undermine validity of deal price; no adjustment for synergies.