Ruling that two partners in a popular Long Island bar and restaurant had “siphoned off” cash receipts for years, Justice Carolyn Demarest (See Profile) of Brooklyn’s Commercial Division awarded the plaintiff, a third partner, a $1.2 million judgment and ordered the defendants to pay it through a forced buyout within 90 days.
Demarest’s 30-page decision in Cortes v. 3A North Park Ave., Index No. 13396/11, reviewed the testimony of three plaintiff experts and one called by defendants on the issue of valuing a closely held restaurant business. She determined that “defendants looted [the business] of cash over many years” and diverted profits to themselves, thus making their claimed enterprise valuation about one-eighth of the actual fair market value.
