Koch v. Koch
This shareholder dispute case involved two businesses three brothers in Minnesota owned. One of the brothers, Jim Koch, had a falling out with the other two, Randy and Dave Koch. A temporary agreement was made among them in 2006, but subsequently the relationship and actions of the parties deteriorated. In particular, an IRS audit of the two businesses triggered a disagreement as to whether required payments under the agreement had to be tax deductible. Certain actions by the defendants breached the 2006 agreement as determined by a jury resulting in a damages award of $12 million. The court then held a bench trial to determine the value of the two businesses for determining the buyout amount for Jim’s interest in both businesses. Experts for each side testified as to value. The opinion provided a good analysis of the various issues in the methodologies each of the experts used.
Minority Shareholder Receives Award of $12 Million for Breach of Contract, $58 Million Buyout Award for Minority Interest
This shareholder dispute case involved two businesses three brothers in Minnesota owned. One of the brothers, Jim Koch, had a falling out with the other two, Randy and Dave Koch. A temporary agreement was made among them in 2006, but subsequently the relationship and actions of the parties deteriorated. In particular, an IRS audit of the two businesses triggered a disagreement as to whether required payments under the agreement had to be tax deductible. Certain actions by the defendants breached the 2006 agreement as determined by a jury resulting in a damages award of $12 million. The court then held a bench trial to determine the value of the two businesses for determining the buyout amount for Jim’s interest in both businesses. Experts for each side testified as to value. The opinion provided a good analysis of the various issues in the methodologies each of the experts used.
R.D. Clark & Sons, Inc. v. Clark
Trial court’s fair value determination in buyout dispute involving family business withstands appeal, including decision not to tax affect or apply majority and minority discounts; appellate court finds there is no controlling state law on the issues and upholds trial court’s findings on facts.
Courts Reject Tax Affecting and Use of Discounts in Connecticut Buyout Dispute
Trial court’s fair value determination in buyout dispute involving family business withstands appeal, including decision not to tax affect or apply majority and minority discounts; appellate court finds there is no controlling state law on the issues and upholds trial court’s findings on facts.
Tax Effects Are Relevant to Equitable Distribution Analysis
Reviewing court says in valuing owner spouse’s auto transport business and performing equitable distribution analysis, trial court erred when it refused to consider tax effects of potential sale of business before assigning asset to owner; case remanded.
Carney v. Carney
Reviewing court says in valuing owner spouse’s auto transport business and performing equitable distribution analysis, trial court erred when it refused to consider tax effects of potential sale of business before assigning asset to owner; case remanded.
Tax Effects Are Relevant to Equitable Distribution Analysis
Reviewing court says in valuing owner spouse’s auto transport business and performing equitable distribution analysis, trial court erred when it refused to consider tax effects of potential sale of business before assigning asset to owner; case remanded.
Court Distinguishes Between Proving Fact of Damage and Amount
Court upholds lost profits award, noting at trial plaintiff established “the fact of damages” with the requisite certainty; defendant deprived plaintiff of learning about job applicants, some of whom plaintiff would have hired to perform additional work.
Court Distinguishes Between Proving Fact of Damage and Amount
Court upholds lost profits award, noting at trial plaintiff established “the fact of damages” with the requisite certainty; defendant deprived plaintiff of learning about job applicants, some of whom plaintiff would have hired to perform additional work.
Marten Transp., Ltd. v. Plattform Adver., Inc.
Court upholds lost profits award, noting at trial plaintiff established “the fact of damages” with the requisite certainty; defendant deprived plaintiff of learning about job applicants, some of whom plaintiff would have hired to perform additional work.
Affirmation of DLOM Rulings Augurs End to Shareholder Fight
In dissenting shareholder suit, appeals court upholds trial court’s finding that prevailing DCF analysis did not account for illiquidity by way of a separate marketability discount, as well as court’s finding that appropriate DLOM rate was 25%.
Wisniewski v. Walsh (Wisniewski II)
In dissenting shareholder suit, appeals court upholds trial court’s finding that prevailing DCF analysis did not account for illiquidity by way of a separate marketability discount, as well as court’s finding that appropriate DLOM rate was 25%.
Devoid of Goodwill, Corporation Escapes Income Tax Liability
Tax Court says taxpayer’s company owned no corporate goodwill and had no right to taxpayer’s personal goodwill and, therefore, was not liable under IRC Sect. 311(b)(1); the taxpayer, in turn, was not liable for gifting corporate goodwill to his sons.
Bross Trucking, Inc. v. Commissioner
Tax Court says taxpayer’s company owned no corporate goodwill and had no right to taxpayer’s personal goodwill and, therefore, was not liable under IRC Sect. 311(b)(1); the taxpayer, in turn, was not liable for gifting corporate goodwill to his sons.
Minority Shareholder’s Conduct Warrants Marketability Discount
In forced buyout, the appellate court affirms the trial court’s decision to adopt, with reservations, the discounted-cash-flow (DCF) valuation the seller’s expert proposed, but finds the oppressive conduct of the minority shareholder, the seller, justifie ...
Wisniewski v. Walsh
In forced buyout, the appellate court affirms the trial court’s decision to adopt, with reservations, the discounted-cash-flow (DCF) valuation the seller’s expert proposed, but finds the oppressive conduct of the minority shareholder, the seller, justifie ...
‘Laborious’ Buy-Sell Agreement Leads to Lengthy Litigation
Court interprets “laborious” definition of buy-sell value.
Dimaria v. Goor
Court interprets “laborious” definition of buy-sell value.
In re Marriage of Meek-Duncomb
Divorce court declines to credit “uncertified” business appraisal by CPA who reviewed only tax returns and Excel spreadsheets, without considering business’s assets and debts, sources of revenues and customer relationships.
Independent Verification of Data Critical in Two Divorce Cases
Divorce court discredits expert valuation for failure to independently verify information provided by the owner/husband.
Arizona Adopts Time-Rules for Characterizing Unvested Stock Options
The Arizona Court of Appeals, First Division adopted two variations of the time-rule for characterizing unvested stock options granted during a marriage. It adopted the Hug rule for use when the options were granted for past services and the Nelson rule w ...
In re the Marriage of William J. Brebaugh v. Nancy L. (Brebaugh) Deane
The Arizona Court of Appeals, First Division adopted two variations of the time-rule for characterizing unvested stock options granted during a marriage. It adopted the Hug rule for use when the options were granted for past services and the Nelson rule w ...
Kathryn Casey v. Amboy Bancorporation (Casey III)
The New Jersey Superior Court, Appellate Division affirmed a lower court’s calculation of fair value and its treatment of synergies in this dissenters’ rights action. It permitted the determination of fair value to be based on the highest feasible sale pr ...
New Jersey Considers Fair Value and Synergy
The New Jersey Superior Court, Appellate Division, affirmed a lower court’s calculation of fair value and its treatment of synergies in this dissenters’ rights action.
Tax affecting denied when sale not likely
In this marital dissolution case, the issue on appeal was whether it was proper for the trial court to tax-affect husband’s trucking business even though a sale was not foreseeable.