Agreements that limit former employees from soliciting customers or disclosing confidential information are critical to protecting the value of a closely held business. Restrictive covenants and non-compete agreements are difficult to enforce and must be carefully drafted to assure that they are enforceable. …
Intangible Capital are the elements that define a company’s real earnings capacity and its value. The Exit Planning Institute recognizes four intangile capitals in a business: human capital, structural capital, customer capital and social capital. Intangible capital is closely tied to the intangible assets of a business, which commonly represents…
It’s a decision involving a law firm partnership that, if widely followed, will likely have a sweeping effect on the interpretation of the statutory requirement for unanimity in adopting critical agreements that govern partnerships and liited liability companies. Attorney Andrew Zidel, an attorney who left prominent intellectual property boutique firm…
Divorcing couples that own a business together must address business ownership issues as part of the matrimonial issues, in particular the distribution of assets. An important issue when a couple divorces is how to address the family owned business in which one…
The effective date of an LLC member’s expulsion may be a critical issue in business divorce litigation and may be tied to critical events or the litigation. Courts will look at the facts and circumstances of the case before determining the effective date, but are often guided by the parties’…
Majority Owners of closely held businesses may face claims that they engaged in minority oppression of shareholders, limited liability company members or partners. Defending the minority oppression claim requires examination of written agreements and consideration of the reasonable expectations of the owners when the business was formed. Claims of minority…
The failure of the parties to submit evidence on an issue during arbitration caused a failure to decide all of the issues of the dispute. A Court may modify an arbitration award rather than vacate and permit partial enforcement while permitting litigation of claims were not included in an arbitration…
A court may immecdiately grant the plaintiff a restraining order or preliminary injunction when there is a valid trade secret claim and the plaintiff may suffer irreparable harm without it. Courts make the determination whether an injunction is necessary based on the evidence presented by the plaintiff at an initial…
An equitable accounting is a cause of action that requires those in control of the finances of a closely held business to account for their use of the money. An accounting a two-stage process. First the controlling party must render an account of how it used the assets of the…
There is no statutory right to receive a distribution of profits from a limited liability company before it dissolves and winds up its affairs. Distributions before then are discretionary. Profit distributions are in the discretion of the majority members or commonly in the discretion of the managers of the limited…