The Ganz Investment Co. v. Tam Partners CA1/1

I. BACKGROUND

SOMA owns a single real property asset known as 201 8th Street in San Francisco. In its request for a judicial dissolution, Ganz alleged that it was “not reasonably practicable to carry on the business of [SOMA] in conformity with the articles of organization or operating agreement” and management was “helplessly and irreconcilably deadlocked.” Shortly after Ganz filed its request for dissolution, Tam filed, and the trial court granted, a motion to stay the dissolution to allow Tam to buy Ganz’s membership interest once its fair market value was determined. Each party selected an appraiser, and the court ordered the retention of a third. After the appraisers submitted their initial reports, the trial court ordered them to meet and confer. A supplemental report was subsequently filed. Before the supplemental report was filed, Ganz moved to lift the stay and “extinguish” Tam’s right to buy Ganz’s interest. Ganz argued that SOMA already had been dissolved by the terms of its operating agreement, and that this prior dissolution “trump[ed]” any buyout procedure and required SOMA to be wound down. The trial court concluded that no such prior dissolution had occurred.…