Connelly v. United States
The importance of this case was that the 8th Circuit’s decision to affirm the lower court and IRS’ inclusion of life insurance proceeds in the value of the corporation for which decedent’s stock was redeemed. This contradicted the decision of the 11th Circuit in Estate of Blount that 26 C.F.R. § 20.2031-2(f)(2) precluded the inclusion of life-insurance proceeds in the corporate value when the proceeds were used for a redemption obligation.
8th Circuit Affirms District Court—Includes Life Insurance Proceeds in Value of Redeemed Shares
The importance of this case was that the 8th Circuit’s decision to affirm the lower court and IRS’ inclusion of life insurance proceeds in the value of the corporation for which decedent’s stock was redeemed. This contradicted the decision of the 11th Circuit in Estate of Blount that 26 C.F.R. § 20.2031-2(f)(2) precluded the inclusion of life-insurance proceeds in the corporate value when the proceeds were used for a redemption obligation.
What Would a Hypothetical Willing Seller Do? A Complicated Case—A Confounding Decision in Idaho
An inside look by one of the experts in a case that “had it all”: a high-tech startup, a recent historical transaction, the personal goodwill-versus-commercial goodwill debate, a covenant not to compete, a lot of money at stake, and the proverbial “battle of the experts.”
'Confounding incongruities' in recent divorce case
A complex divorce case in Idaho included a number of valuation issues, one of which was the personal vs. enterprise goodwill question.
Lamm v. Preston
This was a divorce case with a complex set of issues regarding the marital estate and the businesses of the parties. This Supreme Court of Idaho case and opinion related to one of the businesses, Black Sage Acquisition LLC, in which the couple owned 25%. The magistrate court determined the value of Black Sage Acquisition as $163,373 based on fair market value. The remaining value was determined to be personal goodwill. The Supreme Court (Idaho) affirmed the decision of the district court, which upheld the magistrate court.
Idaho Supreme Court Affirms Magistrate Judge’s Opinion Regarding Personal Goodwill
This was a divorce case with a complex set of issues regarding the marital estate and the businesses of the parties. This Supreme Court of Idaho case and opinion related to one of the businesses, Black Sage Acquisition LLC, in which the couple owned 25%. The magistrate court determined the value of Black Sage Acquisition as $163,373 based on fair market value. The remaining value was determined to be personal goodwill. The Supreme Court (Idaho) affirmed the decision of the district court, which upheld the magistrate court.
Stark Differences from the Inside Out: Two Key Responders Discuss The Final Stark Regulations for FMV and Commercial Reasonableness
The Stark regulations have been updated. What has changed and how does it impact value? Mark Dietrich and Tim Smith were two major contributors of public comments to the Centers for Medicare & Medicaid (CMS) for the updated Stark regulations with over 100 pages of newly written material that was influential in the development of the final regulatory definitions for FMV and commercial reasonableness. In addition, they included over a dozen chapters from the BVR/AHLA ...
Family Matters: Standard of Value, DLOM/DLOC Discounts and Drama in BV
A buried body, sex surrogates, and family-owned business create a dramatic background for a recent court case impacting valuation. With complex minority discounts, this case kicks off a compelling discussion of key issues in family law. Experts Stacey Udell, Neil Beaton, and Ron Seigneur tackle these thorny issues with clarity and comedy. Get treated to the tricks and tips you’ll want when your next family-owned business engagement rings your doorbell.
Boesch v. Holeman (I)
In dispute over value of dissociated partner’s one-third interest in whiskey business, appeals court says trial court erred in adopting value determination that applied discount for lack of control; applicable partnership law requires value be based on sale of entire business as a going concern.
Partnership Statute Precludes Use of Minority Discount in Buying Out Dissociated Partner
In dispute over value of dissociated partner’s one-third interest in whiskey business, appeals court says trial court erred in adopting value determination that applied discount for lack of control; applicable partnership law requires value be based on sale of entire business as a going concern.
Reconciling FMV with Investment Value: What’s Up with the Proposed Redefinition of FMV by Healthcare Regulators?
In October, the Centers for Medicare and Medicaid Services (CMS) released its newly proposed updates to the Stark regulations that included an overhaul of the definition of fair market value (FMV) for regulatory compliance purposes. Surprisingly, CMS pointed to a whole new framework for FMV and valuation practice in general. To help practitioners prepare for the new paradigm, Tim Smith will do a deep dive into the proposed redefinition of FMV and how CMS now ...
Split high court rules on classification of earnout payment in divorce dispute
The parties’ dispute over how to classify earnout payments related to the sale of a valuable marital asset recently prompted a split ruling from the Minnesota Supreme Court. The issue was whether those payments were part of the sales consideration, as the wife argued, or represented future compensation to the husband, as the district court found.
Contentious ruling from Minnesota high court on dealing with earnout payments in divorce
In an important ruling, a divided Minnesota Supreme Court recently ruled on whether earnout payments related to the sale of the husband’s interest in a lucrative company were a marital asset.
Divided High Court Says Earn-Out Payments From Company Sale Are a Marital Asset
Earn-out payments related to sale of a marital asset were marital asset and subject to equitable distribution, Supreme Court’s majority says, even though value of the payments was uncertain as of the valuation date and the sale of the husband’s company took place after the valuation date.
Gill v. Gill
Earn-out payments related to sale of a marital asset were marital asset and subject to equitable distribution, Supreme Court’s majority says, even though value of the payments was uncertain as of the valuation date and the sale of the husband’s company took place after the valuation date.
‘Lady Liberty’ Stamp Costs USPS Millions in Copyright Infringement
Court finds USPS’s unauthorized use of image of Las Vegas Lady Liberty on stamps infringed creator’s copyright and awards damages resulting from a hypothetical mixed license; USPS’s unique licensing history does not limit damages under applicable fair market value measure of damages.
Davidson v. United States
Court finds USPS’s unauthorized use of image of Las Vegas Lady Liberty on stamps infringed creator’s copyright and awards damages resulting from a hypothetical mixed license; USPS’s unique licensing history does not limit damages under applicable fair market value measure of damages.
Stocker v. Stocker
Trial court did not err in adopting income-based valuation offered by husband’s expert; appeals court calls husband’s attack on his own expert “counterintuitive” where expert explained the value of the company was in its cash flow rather than its assets.
Court Rebuffs Litigant’s Attack on Own Expert’s Income-Based Valuation
Trial court did not err in adopting income-based valuation offered by husband’s expert; appeals court calls husband’s attack on his own expert “counterintuitive” where expert explained the value of the company was in its cash flow rather than its assets.
Value Determination Accords With Parties’ Contract, Chancery Says
Court says valuation firm’s determination of value of defendants’ put units accords with agreement to which plaintiff and defendants committed themselves; since contract does not provide for judicial review, court won’t “second-guess” valuator’s judgment.
PECO Logistics, LLC v. Walnut Inv. Partners, L.P.
Court says valuation firm’s determination of value of defendants’ put units accords with agreement to which plaintiff and defendants committed themselves; since contract does not provide for judicial review, court won’t “second-guess” valuator’s judgment.
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.
Reedy-Huffman v. Huffman
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.
"Highly troubled" by Estate of Adams
I am highly troubled by several recent circumstances. You are familiar with Gross (BV Update has discussed it at length). It is clear to anyone with a modicum of financial background that ...
Poorly researched valuation results in nominal value finding by court
Wife challenged the property division in a dissolution of marriage decree, arguing that the court erred in valuing the husband's interest in a family business at zero.