Chiu v. Chiu is a New York statutory fair value case that is at the tail end of a lengthy dispute between two brothers. The case involved a dispute over the relative ownership positions of the two brothers in the LLC as well as over the fair value of the interest. I was the business valuation expert for the “out” brother. A New York appraiser worked on behalf of the “in” brother. Both sides retained independent real estate experts who, surprisingly, concluded with quite similar values.
Peter Mahler, who writes the New York Business Divorce Blog, wrote a first post covering the first aspect of the case, the determination of relative percentage ownership of the LLC. I provided no testimony on that issue.
In a second post on Chiu v. Chiu, Mr. Mahler writes about the court’s treatment of the marketability discount, or DLOM. He describes the series as follows:
This is the second installment of a two-part examination of a recent post-trial decision by Queens County Supreme Court Justice Allan B. Weiss in Chiu v. Chiu, a decade-long fight between two brothers over the ownership of commercial realty in Long Island City purchased in 1999 for use as a warehouse for a business separately owned by one of the brothers. Last week’s post analyzed the court’s ruling, based on some old tax returns and subsequent advances deemed to be capital contributions, that the percentage ownership split of the title-holding LLC is 90/10. This second post looks at the court’s valuation of the 10% member’s interest triggered by his withdrawal from the LLC.
The issue of the marketability discount in New York is one I have written about before and testified regarding in Chiu v. Chiu.
- New York Statutory Fair Value: To “Marketability Discount” or Not
- Statutory Fair Value in New York – re the Marketability Discount
- New York Statutory Fair Value: Matter of Giaimo #1
- New York Statutory Fair Value: Matter of Giaimo #2