You lost that lovin’ feelin’ Whoa, that lovin’ feelin’ You’ve lost that lovin’ feelin’ Now it’s gone … gone … gone…woah. (The Righteous Brothers’ You’ve Lost that Lovin’ Feeling’) (Written by Phil Spector, Barry Mann, and Cynthia Weil) This is the sixth in the “Breaking Up is Hard to Do” nine-part series on exploring dispute resolution for business divorces. In any legal dispute, two parallel processes are underway: the legal process and the emotional one.  This is particularly true in a business divorce where grief is very often the elephant in the room.  With the loss of that lovin’ feeling’, the co-owners may be grieving the end of their shared vision, loss of their relationship, financial losses, lost employment, or business failure. Whatever the reason, their grief is often a barrier to resolution in a business divorce.  Grief clouds judgment.  Grief results in irrational behavior.  Grief can emotionally incapacitate decision-makers.  As a result, where there is grief, there is a need to understand the process of grieving. Grief is neither linear nor uniform.  Instead, each individual’s grieving process is unique to them.  However, in 1969, Swiss psychiatrist Elisabeth Kübler-Ross identified five emotional stages often experienced by those who are grieving.  These are commonly referred to as the five stages of grief: denial, anger, bargaining, depression, and acceptance.  These five stages are evident in most business divorces and particularly in business divorce mediations. Denial. Denial, which is often the first step in the grief process, is a coping mechanism.  It allows us to survive in the moment.  It is a temporary fix that puts off the inevitable.  It is akin to putting a Band-Aid on a gaping wound.  Denial may ebb and flow over time. In a business divorce, denial takes many forms.  Maybe one owner refuses to accept that the co-owners no longer share a vision and need to part ways.  Perhaps denial led to the crisis when one owner ignored the challenges the business faced.  Or one owner refuses to even engage in dialog about the future. Whatever form denial takes, in the denial stage, a co-owner may be hindered in their ability to negotiate a resolution as they cannot accept and adjust to the new situation. Anger. Anger is a powerful emotion.  It can become all-consuming and may impede progress.  In business divorces, anger frequently presents as blame.  Blaming the other for their actions or inactions.  Blaming the other for the loss or shame or failure.  Blaming the other for some form of betrayal. When in the anger stage, a desire to hurt or penalize the one blamed may underlie a party’s settlement proposals. Bargaining. The bargaining stage is internal.  Instead of blaming the other, the bargaining stage is a series of “what if’s” – what if I had agreed to this, what if I had insisted on that, what if I had offered to do things differently, etc.  Guilt often drives this mindset. Sometimes, in the bargaining stage, a party may offer options for resolution that are unrealistic or impractical as they try to compensate for their guilt. Depression. Depression can be paralyzing.  In the depression stage, an owner may feel that all is lost.  They feel hopeless.  In this stage, a party may struggle to even frame a settlement proposal or see any viable options for resolution. Acceptance. Acceptance occurs when emotions stabilize, and the individual has accepted the new situation.  Acceptance may bring a sense of relief.  Acceptance may bring clarity.  Acceptance may be empowering.  In the acceptance stage, parties are able to adapt and adjust to the new situation.  It is when parties become receptive to resolution. Griefs’ Impact on Mediation So how do the five stages of grief factor into the mediation of a business divorce?  Processing grief takes time, a safe space, and a nonjudgmental and empathic listener.  Mediation offers this.  The back and forth and back and forth in mediation provide time and the opportunity for parties to cycle through their grief and reach acceptance.  Acceptance then allows the parties to find their path to resolution. Disclaimer: “You’re So Vain, You Probably Think This Song is About You” (written and sung by Clary Simon).  Please note that this series is drawn from over 30 years of experience as counsel or neutral in business separations, reconciliations, and divorces.  Nothing in this series is based on any specific dispute in which I have been involved.  In addition, nothing contained herein constitutes legal advice nor does it create a professional relationship. ADR Insights on Business Divorces - You've Lost that Lovin' Feelin' (Part 6 of 9) The post ADR Insights on Business Divorces: You Lost that Lovin’ Feelin’ (Part 6 of 9) appeared first on Sylvia Mayer Law.

Hit me with your best shot, Why don’t you hit me with your best shot, Hit me with your best shot, Fire away. (Pat Benatar’s Hit Me With Your Best Shot) (Written by Eddie Schwartz) This is the fifth in the “Breaking Up is Hard to Do” nine-part series exploring dispute resolution for business divorces. When interpersonal relations sour among co-owners, often the “gloves come off” and aggressive tactics are prevalent.  In arbitration, this may take the form of a party engaging in constant motion practice, serving abusive discovery requests, obstructing discovery compliance, or delaying simply for the sake of delay.  In mediation, aggressive tactics often include bullying, stonewalling, weaponizing time, and deputizing someone with inadequate authority. As a party, you can take steps to mitigate these challenges.  First, know the applicable procedural rules.  In some instances, the rules provide guidance or specify relief for these situations.  Second, focus on the problem, not the person, when considering your options and if seeking intervention.  Third, keep your eyes on the prize (the ultimate outcome), and do not get drawn into time-consuming and expensive skirmishes.  Fourth, instead of fighting fire with fire, find the areas of agreement.  Find the common ground and build on that.  Nothing deflates an antagonist faster than agreeing with them. As a neutral (mediator or arbitrator), our job is to establish guardrails.  On the roadways, guardrails are designed to protect motorists from straying into dangerous territory.  In dispute resolution, guardrails are intended to safeguard the process leading to resolution. Arbitrators use a variety of guardrails to keep an arbitration on track.  For example, discovery costs are often the biggest expense in litigation and, in some cases, an area ripe for abuse.  Arbitrators may establish strict discovery schedules narrowly tailored to the needs of that specific dispute.  Similarly, motion practice may be limited, or a briefing and hearing schedule may be established early on to address preliminary matters, discovery, and other pre-hearing disputes.  At the preliminary scheduling conference, arbitrators typically set the final hearing date and provide that the date can only be changed upon good cause shown.  While each of these tools is useful in many arbitrations, they may be particularly helpful to establish guardrails in “gloves are off” litigation. Mediators also utilize guardrails to keep the process on track.  Active listening and empathy are used by mediators to help parties process their emotions without derailing the process.  Listening sessions can be used when a party comes in “hot” at the start of the mediation.  A listening session is when the mediator begins the mediation by simply listening to each of the parties, separately, without any discussion of settlement or the sharing of information.  Reframing is often used to help a party pivot from provocative or incendiary commentary to more productive dialog.  Technology may help address limited authority. Whether mediation or arbitration, parties in a business divorce may start out ready to “fire away,” but a skilled neutral can implement various guardrails to safeguard the process leading to resolution. Disclaimer: “You’re So Vain, You Probably Think This Song is About You” (written and sung by Clary Simon).  Please note that this series is drawn from over 30 years of experience as counsel or neutral in business separations, reconciliations, and divorces.  Nothing in this series is based on any specific dispute in which I have been involved.  In addition, nothing contained herein constitutes legal advice nor does it create a professional relationship. ADR Insights on Business Divorces - Hit Me With Your Best Shot (Part 5 of 9) The post ADR Insights on Business Divorces: Hit Me With Your Best Shot (Part 5 of 9) appeared first on Sylvia Mayer Law.

Ooo I heard it through the grapevine Not much longer would you be mine Ooo I heard it through the grapevine And I’m just about to lose my mind.  (Marvin Gaye’s I Heard It Through the Grapevine) (Written by Norman Whitfield and Barrett Strong) This is the fourth in the “Breaking Up is Hard to Do” nine-part series on exploring dispute resolution for business divorces. Self-dealing.  Inequitable compensation.  Exclusion from decision-making.  Usurpation of business opportunities.  Denial of access to books and records.  Disagreements over future direction.  Business failure.  Fraud and mismanagement. These are some of the common accusations in business divorces, but each of these allegations boils down to one common catalyst for the dispute:  betrayal. Whether real or perceived betrayal, these disputes are often emotionally charged and suffer from a cavernous trust deficit.  So, how do we diffuse emotions, bridge the trust divide, and move toward resolution? In the context of arbitration, arbitrators use structure to mitigate these challenges.  There is a formal construct setting guidelines, parameters, and hearing dates.  The process culminates in a forum (final hearing) for each of the parties to be heard. In the context of mediation, the trust deficit looms large as the goal is for the parties to reach an agreement.  Mediators have lots of tools in their toolbox to address this, including: Time: Allowing parties time to safely share their experience and process their emotions is critical to these mediations.  Parties often need to be heard, validated, and supported before they can move beyond their pain to explore options for resolution. Common Ground: Parties locked in a dispute tend to focus only on their differences.  As a result, they miss the common ground.  Taking time to seek out, identify, and highlight areas of agreement may help rebuild some of the lost connection and trust. Connection: At the start of their venture, the co-owners shared some connection – a family connection, a friendship, a shared vision, something.  In some business divorce mediations, once they have had a chance to process their negative emotions, parties become nostalgic about the connection they once had.  Once remembered, this shared connection may help parties shift toward finding a path to resolution. Reciprocity: Deeply engrained in nearly every culture is the rule of reciprocity:  those who give a benefit are entitled to get a benefit in return.  Time and reciprocity need to be sequenced.  The rule of reciprocity is most effective once each party has begun to process their emotions.  The back and forth, and back and forth, and back and forth of mediation is reciprocity at work. Receptivity: To pivot from entrenched positions to exploring interests and options for resolution, parties need to become receptive. Receptivity is being open to hearing and considering different views, opinions, and options.  Receptivity takes time – time to share, time to be validated, time for empathy, time to process, time to find common ground, and time to engage in reciprocity.  Once all parties are receptive, meaningful progress can be made in finding a path to resolution. Disclaimer: “You’re So Vain, You Probably Think This Song is About You” (written and sung by Clary Simon).  Please note that this series is drawn from over 30 years of experience as counsel or neutral in business separations, reconciliations, and divorces.  Nothing in this series is based on any specific dispute in which I have been involved.  In addition, nothing contained herein constitutes legal advice nor does it create a professional relationship. ADR Insights on Business Divorces - I Heard it Through the Grapevine (Part 4 of 9) The post ADR Insights on Business Divorces: I Heard It Through the Grapevine (Part 4 of 9) appeared first on Sylvia Mayer Law.

I’ve had choices, since the day that I was born There were voices that told me right from wrong If I had listened, I wouldn’t be here today Living and dying with the choices I made. (George Jones’ Choices) (Written by Billy Yates and Mike Curtis) This is the third in the “Breaking up is Hard to Do” nine-part series exploring dispute resolution for business divorces. Choices.  Disagreements are inevitable.  There are many choices available to resolve them.  The first important choice is to include a dispute resolution clause in the governing documents.  Having clearly defined procedures may alleviate some of the tension as the parties work toward a resolution. When choosing a dispute resolution clause, rather than using a boilerplate provision, business partners should think about their specific needs and concerns.  Co-owners should consider different forms of dispute resolution including mediation, arbitration, and courthouse litigation.  They should think about confidentiality, cost containment, time constraints, relationship preservation, formality, and industry factors.  They should examine procedural issues including jurisdiction, venue, forum, governing law, and statutes of limitations. If relationship preservation is a primary driver, then early mediation may be the best place to start.  However, provision should be made for next steps if efforts at consensual resolution are unsuccessful. If confidentiality is of great importance, then mediation and arbitration may be good choices because both may be conducted confidentially. If cost containment or time constraints are essential, then deadlines can be embedded in the dispute resolution clause governing mediation and arbitration.  In addition, for arbitration, the clause can provide for a sole arbitrator and establish limits on discovery. If the dispute resolution clause includes mediation and/or arbitration, then it should also address whether it will be administered by a third party (i.e., AAA, CPR, AHLA, JAMS, etc.) or governed by the procedural rules of a third party even if non-administered. One word of caution.  At inception, there is no way to predict the nature, breadth, or depth of disputes in the future.  Make sure to build into the clause sufficient flexibility so that it will remain relevant regardless of how the future may play out. There are many dispute resolution clause drafting tools available for free, including through the American Arbitration Association and JAMS, which can be used to design a dispute resolution clause tailored to fit the situation. With so many choices, business partners should take the time to understand their options and explore their concerns, then customize a dispute resolution clause that fits their specific needs. Disclaimer: “You’re So Vain, You Probably Think This Song is About You” (written and sung by Clary Simon).  Please note that this series is drawn from over 30 years of experience as counsel or neutral in business separations, reconciliations, and divorces.  Nothing in this series is based on any specific dispute in which I have been involved.  In addition, nothing contained herein constitutes legal advice nor does it create a professional relationship. ADR Insights on Business Divorces - Choices (Part 3 of 9) The post ADR Insights on Business Divorces: Choices (Part 3 of 9) appeared first on Sylvia Mayer Law.

 Be careful when write checks to pay bills due to fraud! See the New York Times article at https://www.nytimes.com/2023/12/09/business/check-fraud.html?smid=nytcore-android-share Jim Shenwick, Esq  917 363 3391  [email protected] Please click the link to schedule a telephone call with me. https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!

What is the means test in bankruptcy? Business Insider (see link below) has a very helpful article on the Means Test in personal Bankruptcy filings. https://www.businessinsider.com/personal-finance/what-is-bankruptcy-means-testIn our experience, having filed approximately 1,000 Bankruptcy Petitions for individuals and businesses, the Median Income and Means Test is especially important for higher income Debtors. Individuals with questions about the Median Income or Means Test should contact Jim Shenwick, EsqJim Shenwick, Esq  917 363 3391  [email protected] click the link to schedule a telephone call with me.https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!

 Fraud Investigations into COVID-Era PPP and EIDL Loans Increasing. JD Supra (link below) has an article stating that fraud investigations into PPP and EIDL loans from the SBA are increasing. https://www.jdsupra.com/legalnews/fraud-investigations-into-covid-era-ppp-3571111/Based on telephone calls to our law offices, we believe that that statement is correct. Clients who are contacted by the Department of Justice regarding PPP or EIDL fraud should contact and retain experienced criminal counsel as soon as possible.We at Shenwick & Associates are only representing clients with Defaulted SBA loans. Jim Shenwick, Esq  917 363 3391  [email protected] Please click the link to schedule a telephone call with me.https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!

You just slip out the back, Jack Make a new plan, Stan You don’t need to be coy, Roy Just get yourself free. (Paul Simon’s 50 Ways to Leave Your Lover) (Written by Paul Simon) This is the second in the “Breaking up is Hard to Do” nine-part series exploring dispute resolution for business divorces. Make a new plan. When starting a new business, business partners are in the honeymoon phase.  Frequently, they have tunnel vision and are focused solely on building their business.  While building the business is mission-critical, equally important is advance planning to minimize future disputes and disruptions. At inception, the co-owner relationship is at its peak and there is no history of bad experiences or pent-up negative emotions.  While it may be hard to imagine a scenario where they disagree or face challenges, co-owners need to prepare on the front end for the disputes that may arise on the back end.  In addition to considering future upside, new business partners should discuss goals, inflection points, worst-case scenarios, and potential pitfalls. Here is a non-exhaustive list of topics new business partners should explore: Ownership structure, Financial and performance goals, Short and long-term objectives, Exit strategy and options, Capital contributions and capital accounts, Compensation, Noncompete agreements, Fiduciary duties, Succession planning (both long-term and in the event of an emergency), Access to books and records, Audit rights, Checks and balances, Potential dissolution or liquidation, Buy-sell provisions (including triggers, mechanics, and valuation methods and procedures), Control features (including voting requirements and breaking deadlocks) General corporate governance, and Dispute resolution. The best method to resolve business disputes is to avoid them altogether through careful consideration and planning at the beginning.  As Benjamin Franklin once said, “By failing to prepare, you are preparing to fail.”  Instead of preparing to fail, at formation, co-owners should make a new plan for the future. Disclaimer: “You’re So Vain, You Probably Think This Song is About You” (written and sung by Clary Simon).  Please note that this series is drawn from over 30 years of experience as counsel or neutral in business separations, reconciliations, and divorces.  Nothing in this series is based on any specific dispute in which I have been involved.  In addition, nothing contained herein constitutes legal advice nor does it create a professional relationship. ADR Insights on Business Divorces - Make a New Plan, Stan (Part 2 of 9) The post ADR Insights on Business Divorces: Make a New Plan, Stan (Part 2 of 9) appeared first on Sylvia Mayer Law.

They say that breaking up is hard to do. Now I know, I know that it is true. (Neil Sedaka’s Breaking Up is Hard to Do) (Written by Neil Sedaka and Howard Greenfield) Welcome to “Breaking up is Hard to Do.”  This is the first in a nine-part series exploring dispute resolution for business divorces. Let’s start at the very beginning.  What is a business divorce? Generally, a business divorce is when a situation arises between business partners leading to one or more seeking to break up.  While some business divorces are amicable, many are not.  When the co-owners cannot agree, then their dispute may end up in mediation, arbitration, or courthouse litigation. In this series, we will explore a myriad of issues related to resolving business divorces, including planning, emotions, valuation, potential reconciliation, and closure. Although breaking up is hard to do, careful advanced planning and thoughtful navigation of the process can help parties find a path to resolution of the disputes that arise in their business break-up. Disclaimer: “You’re So Vain, You Probably Think This Song is About You” (written and sung by Clary Simon).  Please note that this series is drawn from over 30 years of experience as counsel or neutral in business separations, reconciliations, and divorces.  Nothing in this series is based on any specific dispute in which I have been involved.  In addition, nothing contained herein constitutes legal advice nor does it create a professional relationship. ADR Insights on Business Divorces - Breaking Up is Hard to Do (Part 1 of 9) The post ADR Insights on Business Divorces: Breaking Up is Hard to Do (Part 1 of 9) appeared first on Sylvia Mayer Law.

Mediation is a give and take.  It requires listening and sharing.  It requires understanding wants and needs. To illustrate, let’s consider Karen Kaufman Orloff’s “I Wanna Iguana.” In this story, young Alex’s friend Mikey is moving away and cannot take his pet iguana with him.  Alex really, really, really wants to adopt his friend’s iguana.  He just has to convince his mother. As the story unfolds, Alex and his mother exchange a series of letters.  Alex explains in each letter why he should be allowed to have a pet iguana.  His mom responds. Alex’s first letter reads:  “Dear Mom, Did you know that iguanas are really quiet and they are cute too.  I think they are much cuter than hamsters.  Love, Your adorable son, Alex.” Mom responds: “Dear Alex, Tarantulas are quiet too, but I wouldn’t want one as a pet.  By the way, that iguana of Mikey’s is uglier than Godzilla.  Just thought I’d mention it. Love, Mom.” Their letters go back and forth as Alex tries various different arguments.  These arguments range from, he’s so small you will never know he’s there, to which Mom responds that iguanas can grow to over 6 feet long so she will know, to the iguana can be the brother that I’ve always wanted, to which Mom responds that he already has a brother. Alex perseveres.  But, more importantly, both Alex and Mom learn in the process.  Through trial and error, they each begin to understand what is important to the other. In one letter, Mom reminds Alex what happened when he brought home the class fish.  Alex responds with “Dear Mom, If I knew the fish was going to jump into the spaghetti sauce, I never would have taken the cover off the jar!  Love, Your son who has learned his lesson. P.S. Iguanas don’t like spaghetti.” This letter marks a turning point because Mom responds by asking, if he were allowed to have the iguana on a trial basis, how would he care for it? Through more letters, Alex explains how he would feed and water the iguana, clean its cage, and use his allowance to pay for its food.  Mom writes in her final letter, “Dear Alex, Look on your dresser. Love, Mom”  And there, Alex finds the iguana. This story beautifully captures the give and take of a successful mediation.  Alex and Mom each listened to the other.  Each shared with the other.  They each considered the wants and the needs of the other.  And, ultimately, they reached an agreement. Listening.  Sharing.  Considering both your own wants and needs and the other’s wants and needs.  These are important parts of finding your path to resolution. Author’s Note: As a mediator, I am a “forever student” always seeking new ways to help people find a path to resolution in mediation.  As a parent, I have spent a gazillion hours reading books to my children.  Oftentimes, these books teach me new ways to approach conflict resolution.  In this case, Karen Kaufman Orloff’s “I Wanna Iguana” inspired this post. Disclaimer:  Nothing contained herein constitutes legal advice nor does anything contained herein create a professional relationship. Mediator Insights - The Give and Take of Mediation The post Mediator Insights: The Give and Take of Mediation appeared first on Sylvia Mayer Law.