Our client, the owner of a café located in Center City, Philadelphia, formed a joint venture with his neighbor to roast, produce, and sell coffee to other local restaurants in the Philadelphia region.
Under their agreement, our client would provide the financing for the fledgling business and his business partner would provide the so-called sweat equity.
About a year into the joint venture, our client became unhappy as his business partner would not provide any accounting for how funds for the joint venture, which our client had provided, were being spent or for any earnings the joint venture had attained. After that happened, our client retained our law firm to represent his interests with respect to this dispute.
Early on during negotiations between our law firm and the business partner’s legal counsel, it became obvious that the business partner would not provide an accounting voluntarily, but only if our client were to file a lawsuit against the business partner. Given the option of litigation which could prove potentially costly, as well as lengthy, our client authorized us to aggressively negotiate and effectuate his withdrawal from the joint venture.
Although these negotiations were emotionally charged (as there was a lot of hostility and accusations of impropriety between the former business partners), we successfully negotiated an agreement between them in which our client was able to withdraw from the joint venture in consideration of which the former business partner would give him a promissory note to compensate him for his financial interest in the joint venture as well as a significant amount of the roasted coffee beans produced by the joint venture which our client could use for his café.
His former business partner has since complied with the terms and conditions of their agreement and our client’s financial investment in this joint venture was saved.