Baumboree v. Baumbouree
Appeals court agrees with trial court that valuation in stock agreement is binding in partition action even though non-owner spouse refused to sign agreement and agreement did not mention divorce as one of the circumstances in which valuation applied.
Mann v. Mann
In appreciation of value case, court agrees with wife’s expert that calculation of marital portion of wife’s interest in family business requires quantification of personal goodwill attributable to wife based on value of noncompete to potential buyer in arm’s-length transaction.
Court Adopts Appreciation Analysis That Places ‘Specific Dollar Value’ on Goodwill
In appreciation of value case, court agrees with wife’s expert that calculation of marital portion of wife’s interest in family business requires quantification of personal goodwill attributable to wife based on value of noncompete to potential buyer in arm’s-length transaction.
Why Divorce Valuation Does Not Accord With Chapter 7 Liquidation Analysis
Bankruptcy Court says differing standard of value in divorce and bankruptcy proceedings precludes use of divorce valuation of husband’s interest in dental practice; but valuation based on shareholder agreement accords with Chapter 7 liquidation analysis.
Congel v Malfitano (I)
New York appellate court says trial court erred when it declined to apply minority discount in determining “value” of minority shareholder’s interest in partnership where shareholder wrongfully dissolved partnership and buyout was not a fair value proceed ...
Why Bankruptcy Court declines to be bound by divorce valuation
Following the divorce, the husband filed for Chapter 13 bankruptcy and asked for confirmation of his plan. The issue was whether the plan could meet the liquidation test applicable under the Bankruptcy Code’s section 1325(a)(4). In essence, the test requires that creditors in a Chapter 13 bankruptcy receive present value payments that are at least equal to the amount the creditors would receive in a Chapter 7 case.
Buyer’s Failure to Assign Value to Practice Goodwill Nullifies Noncompete
Appeals court says noncompete/nonsolicitation clauses accompanying sale of solo practitioner’s medical practice to large healthcare provider are unenforceable where buyer allocated zero dollar value to practice’s goodwill; court strikes down injunction.
Comparable Transaction Exposes Error in Court’s Enterprise Goodwill Ruling
Appeals court strikes divorce ruling adopting income-based valuation of enterprise value of owner’s financial services business, valuation conflicts with data from similar transaction that occurred close to valuation date and involved owner-spouse.
In re Cole
Bankruptcy Court says differing standard of value in divorce and bankruptcy proceedings precludes use of divorce valuation of husband’s interest in dental practice; but valuation based on shareholder agreement accords with Chapter 7 liquidation analysis.
Goodwill-noncompete connection trips up buyer of medical practice
Ultimately, the parties reached a deal that included the sale of the building and the sale of the assets of the practice, as well as an employment contract for the doctor. The asset purchase agreement said the assets being sold included all of the practice's goodwill. At the same time, it allocated 100 percent of the purchase price to tangible assets: furniture, fixtures, equipment and supplies. The agreement also included noncompete and non-solicitation clauses.
Court Rebuffs Attempt to Allocate Excess Value to Intangible Assets
Bankruptcy Court rejects proposition that sales price increase has to be attributed to one debtor’s business, as goodwill, because other debtor’s real property allegedly remains constant in value; court denies request to change allocation of proceeds.
Recent analyses examine extent of intangibles in PPAs
Intangible assets average 30% of the purchase consideration (PC) and goodwill averages 38% of the PC, according to the Houlihan Lokey 2014 Purchase Price Allocation Study. A different analysis of over 6,000 purchase price allocations finds that the ratio of intangible assets to total assets is 72%. This is according to the second edition of Benchmarking Identifiable Intangibles and Their Useful Lives in Business Combinations.
Healthcare v. Orr
Appeals court says noncompete/nonsolicitation clauses accompanying sale of solo practitioner’s medical practice to large healthcare provider are unenforceable where buyer allocated zero dollar value to practice’s goodwill; court strikes down injunction.
South Carolina Supreme Court Makes New Law on Business Goodwill
In a first, state high court “cautiously” decides enterprise goodwill is marital property subject to equitable division and affirms that personal goodwill is not; court rejects claim that only professionals can develop personal goodwill in a business.
In re Marriage of Johnson
Appeals court strikes divorce ruling adopting income-based valuation of enterprise value of owner’s financial services business, valuation conflicts with data from similar transaction that occurred close to valuation date and involved owner-spouse.
Court Declines to Attribute Commercial Goodwill to Solo Practice
Appeals court affirms trial court’s ruling finding that, without noncompete from owner-spouse, under FMV standard, financial advisor’s solo practice fetches only net book value of its tangible assets; most of value lies in owner-spouse’s personal goodwill ...
In re Case No. 800 Bourbon St.
Bankruptcy Court rejects proposition that sales price increase has to be attributed to one debtor’s business, as goodwill, because other debtor’s real property allegedly remains constant in value; court denies request to change allocation of proceeds.
Tennessee Appeals Court Straddles Goodwill Issue in Divorce
Appeals court finds enterprise goodwill is not a marital asset when the business is a sole proprietorship and orders trial court to produce a valuation of husband’s solo dental practice without “consideration of professional or enterprise goodwill.”
Moore v. Moore
In a first, state high court “cautiously” decides enterprise goodwill is marital property subject to equitable division and affirms that personal goodwill is not; court rejects claim that only professionals can develop personal goodwill in a business.
‘Blunderbuss of Objections’ Aims to Kill Loss of Goodwill Calculation
Defendant’s “blunderbuss of objections” to opposing expert’s valuation of loss of goodwill misses mark, 7th Circuit says; expert used a standard business valuation method and his reliance on company financials was justified under rules of evidence.
Court Infers Nature of Goodwill From Nature of Business
Appeals court affirms trial court’s valuation, which implicitly assigned goodwill to business, finding that since the company was not a professional practice it is likely that the company’s, rather than the owner spouse’s, reputation brings in business.
Court Validates Zero Goodwill for Naturopathic Practice
State high court affirms trial court’s determination that husband’s naturopathic practice had zero goodwill value based solely on husband’s testimony that a similar practice in the area failed to attract a buyer despite being on the market for a year.
K.T. v. M.T.
Appeals court affirms trial court’s ruling finding that, without noncompete from owner-spouse, under FMV standard, financial advisor’s solo practice fetches only net book value of its tangible assets; most of value lies in owner-spouse’s personal goodwill ...