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Closely Held Corporate Shares Require a Discount
In divorce, it is sometimes necessary to value shares of a closely held corporation. Of course, we all know that ascertaining the value of shares in a publicly traded company, such as Google or Coca-Cola, is a simple undertaking. MSNBC, CNN and the Internet are among the numerous sources available to investors that provide nearly real-time quotes of the latest prices for shares traded over public exchanges like the New York Stock Exchange or NASDAQ. The presence of these national exchanges enables stockholders to immediately liquidate their shares for cash in a matter of minutes through a few clicks of a mouse or a single phone call.
Not so stocks in the thousands of privately held companies throughout New York whose shares are not traded on the NYSE or NASDAQ. These companies often have only a handful of shareholders, many of whom are family members or close friends. Since shares in these companies are not routinely sold each day, there is no market to consult to determine the value of any one shareholder's interest. As a result, a unique form of litigation exists in New York whose purpose is to determine the fair value of an interest in a closely held corporation. Such proceedings are referred to as appraisal proceedings or shareholder valuation proceedings. They are necessary not only in divorce actions, but also in other cases, including dissenting shareholder cases and shareholder dissolution proceedings in which the corporation elects to avoid dissolution by purchasing the petitioning shareholder's interests. In all these cases, the valuation equation is complicated by this fact: There is likely no ready market for the shares at issue. So, should the asset's value be discounted?
Law Firms are Reducing Redundant Real Estate by Bringing Support Services Back to the Office
A trend analysis of the benefits and challenges of bringing back administrative, word processing and billing services to law offices.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Bit Parts
Summary Judgment Denied Defendant in Declaratory Action by Producer of To Kill a Mockingbird Broadway Play Seeking Amateur Theatrical Rights
Risks of “Baseball Arbitration” in Resolving Real Estate Disputes
“Baseball arbitration” refers to the process used in Major League Baseball in which if an eligible player's representative and the club ownership cannot reach a compensation agreement through negotiation, each party enters a final submission and during a formal hearing each side — player and management — presents its case and then the designated panel of arbitrators chooses one of the salary bids with no other result being allowed. This method has become increasingly popular even beyond the sport of baseball.
Disconnect Between In-House and Outside Counsel
'Disconnect Between In-House and Outside Counsel is a continuation of the discussion of client expectations and the disconnect that often occurs. And although the outside attorneys should be pursuing how inside-counsel actually think, inside counsel should make an effort to impart this information without waiting to be asked.