Train Wrecks and Appraisals

Train Wrecks and Appraisals

Peter Mahler, in his blog New York Business Divorce, has reviewed a decision in Nebraska that, at least for the plaintiff, is fairly characterized as a train wreck.

The dispute involved the valuation of a withdrawn partner’s interest from a law firm partnership. The law firm presented a single valuation expert, an individual with extensive experience in the valuation of law firms. This expert submitted a full valuation report.

The plaintiff, in contrast, sought to utilize not less than four “experts.” It should be noted, however, that one of those “experts” was the plaintiff himself, the withdrawn partner. another of those experts was a CPA with no certifications in appraisal who had valued a single law firm. The third expert had appraisal certifications, but had done only one law firm valuation. Across these “experts” there were employed a variety of valuation methodologies and inconsistent assumptions. Ultimately, the court gave credence to the firm’s single, accredited and experienced appraiser. The case is Frederick Pebbles & Morgan LLP v. Assane, 300 Neb. 670 (Neb. Aug. 3, 2018). Peter’s review of this decision appears in a blog posting titled Summer Shorts: Partnership Appraisal and Other Recent Decisions of Interest – A Train Wreck of a Valuation Case; HERE IS A LINK to that posting.