Ybarra v. Dominguez Family Enterprises, Inc.

Cases determining “fair value” under dissenter’s rights statute inform the meaning of “fair value” for purposes of ORS 60.952(5). The appropriateness of applying marketability or minority discount to determination of fair value “necessarily depends on the circumstances of the particular case.”

Plaintiff challenged the trial court's ruling that marketability and minority discounts should be applied to plaintiff's share price in their elected buy-out by defendant, Dominguez Family Enterprises, Inc. (DFE), subsequent plaintiff's shareholder suit under ORS 60.952(1) that alleged illegal, oppressive or fraudulent acts. Plaintiff argued that the trial court erred in its determination that a plaintiff must demonstrate oppressive conduct in order to exclude the discounts in the fair value hearing. Plaintiff purports that the intention of the legislature was for "fair value" to be consistent with case law and the price of a shareholder's proportion interest is calculated without minority or marketability discounts. "The application of a minority discount is a case-specific determination; oppression is a relevant circircumstance; application of a minority discount is not appro-priate if oppression is found; and, in the absence of such a finding, the discount may be appropriate." Hill v. Gold, 322 Or App 324, 333-34, 519 P3d 543 (2022). The appropriateness of applying marketability or minority discount to determination of fair value “necessarily depends on the circumstances of the particular case.” Columbia Management Co. v. Wyss, 94 Or App 195, 202, 765 P2d 207 (1988), rev den, 307 Or 571 (1989). The Court held that the trial court erred in concluding that marketability and minority discounts must be applied in the absence of a finding of oppression. The Court also ruled that the discounts can be permitted. The Court reasoned that because court must determine, based on all of the relevant facts and circumstances, whether to apply marketability and/or minority discounts, the discounts may be warranted in some circumstances. VACATED AND REMANDED.