Category: Business Law

An Overview of Business Valuation and Division in Divorce

October 13, 2022  |  Jason C. Brown

Business owners face a unique set of challenges as part of a divorce. The valuation and division of business interests can be complex and stressful.   At a fundamental level, understand that a business is an asset of its owner. Minnesota law provides that the assets of the parties to a divorce are divided in an “equitable” manner. That almost always means equally. Minnesota law also recognizes that if a party to the marriage brings an asset into the relationship, the asset likely has a nonmarital component that is not subject to division. If the value of the nonmarital business grows during the marriage, the increased value is considered marital. The key to determining the significance of business ownership often rests in the value of the business itself. Naturally, the more valuable the business, the more attention it receives. Business valuation is as much art as science. Our family law group works with the more reputable business appraisers in the Twin Cities. These experts typically invoke one of three methods to offer an opinion as to the market value of a business: (1) the balance sheet approach; (2) the multiple of profits approach; and (3) valuation based on comparable business sales. Valuation of a business using a balance sheet approach is relatively straightforward. The…

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What Should be Included in an Arbitration Clause Used in Business Contracts?

October 10, 2022  |  Joan M. Quade

Many companies are choosing arbitration to resolve business disputes, as litigation has become more and more expensive, and it sometimes takes years to get to trial. The district courts are still very behind from the COVID pandemic, adding to the delay. Even after trial, the appeals can go on for years, costing additional resources and time. So, what do you put into an arbitration clause that accomplishes what you want? First, you should always consult with your attorneys based upon your particular business needs. They can draft the perfect arbitration clause for you, after discussing your business goals and philosophy about dispute resolution. Some companies need or want to take a more litigation-like approach regarding disputes and want a requirement to arbitrate because of its cost savings and speed, but also to include some rights to limited discovery in the process. Other businesses take a more collaborative, problem-solving approach to reach a mutually beneficial and economical resolution to problems. They want a requirement in the clause to attempt to resolve any disputes before they file for arbitration, through settlement efforts or even mandatory mediation. If the collaborative, problem-solving method does not work, they want to streamline the dispute resolution through a well-defined arbitration process. Both philosophies need specific clauses that spell out the…

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Workplace Investigations

October 4, 2022  |  Joan M. Quade

What is a workplace investigation? A workplace investigation is where a private company or public employer, such as a city or county, hires an investigator, usually an attorney who is experienced in investigations and employment law, to gather documents and interview people to determine if wrongdoing has occurred or company policy has been violated. The investigation is needed to determine what occurred in a particular situation when facts are known or unknown, or allegations have been made about an event and the complete truth of what occurred is unclear. It is the job of the investigator to gather facts through the review of documents, review of video or other evidence, if available, and to interview people who may have knowledge and information helpful in discovering the truth. What are some examples of workplace investigations? Examples of some of the issues that many times require employment investigations include, but are not limited to, employee theft, allegations of sexual harassment or bullying, assault in the workplace, misuse of company property or funds, sharing of confidential company information, inappropriate use of the company internet and accessing inappropriate internet sites, falsely claiming to work full time, acceptance of gifts or other ethics standards set by the employer and other general claims of employee misconduct. For public employers,…

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