Some business divorce cases are about money. Others are about control. Today’s case, Homapour v 3M Properties LLC, 2026 NY Slip Op 04371 (1st Dept 2026), is about both.As we often see with second and third generation closely-held family
Latest from Farrell Fritz, P.C. - Page 3
Wait a Minute! Just Because I Failed to Meet a Lousy Capital Call, You Took My Membership Interest That You Valued at $1.7 Million and Paid Me Nothing?
Here we go again.My last outing on this blog analyzed a dispute over the consequences of a limited partner’s failure to meet a mandatory capital call. There, the Manhattan-based Appellate Division, First Department, held that under the Delaware limited
Press Your Luck, Pay the Bill: When Refusing to Drop a Doomed Claim Becomes Sanctionable
When does a litigant’s persistence (and perhaps, stubbornness) cross the line into sanctionable conduct? That is the question at the heart of Cortlandt St. Recovery Corp. v. TPG Capital Management, L.P., et al. (Index 651176/2017), a Commercial Division decision by
Multigenerational Intrafamily Business Dispute Defeated for Lack of Standing
Nothing on earth is more effective at dividing family than money. At New York Business Divorce, we’ve encountered almost every manner of money-driven intrafamily business litigation. Husband versus wife. Father versus son. Brother versus brother. Brother versus
Beyond the Pitch Deck: A Legal Guide to Investor-Side Due Diligence
Having counseled investors through dozens of venture transactions in New York and beyond, I can say with confidence that due diligence isn’t a checkbox exercise. It’s the process of stress-testing every material assertion made during the fundraising process and, just
How Far is Too Far? Commercial Division Finds Gross Negligence but Declines to Strike Answer for Digital Spoliation
Spoliation sanctions in the Commercial Division exist on a spectrum—from cost-shifting and adverse inferences to the ultimate sanction of striking a pleading. But where exactly is the line between gross negligence and the kind of “willful or contumacious” conduct that
The Derivative Claim and the Majority Approval Trap
Can an LLC operating agreement strip a minority member of the right to sue derivatively—simply by requiring majority approval before anyone commences litigation “involving the Company”? An arbitrator in New York thought so, and a New York court confirmed it.
What’s the Purpose of Your LLC?
New York LLCs without operating agreements are as common as noodles in Naples. Most function just fine without one. Their members just rely upon the statutory default rules found in the New York Limited Liability Company Law (the “LLC Law”)
Adduced! Ensuring the Record in CPLR Article 78 Proceedings
A special proceeding pursuant to New York Civil Practice Law and Rules (“CPLR”) Article 78, specifically Section 7803(3), is the vehicle for challenging determinations of a body or officer. Section 7803(3) sets forth the all-too-familiar question raised: whether the determination
Lessons on the Art of Drafting Capital Call Provisions
It’s no accident this blog has featured dozens of posts involving disputed capital calls. It’s a common scenario in the world of closely held firms, not always but sometimes pitting the interests of the passive owners in maintaining their equity