Chancery Court ruled last week that a well-known Delaware home builder can proceed with his stock claim.
Stephen W. Bomberger filed suit in Chancery against Benchmark Builders in a dispute over the amount of money he should receive from his stock holdings in the privately held company.
Bomberger, who was the public face and President at Benchmark for more than a quarter century, was fired from his post in 2015 by other founders, brothers Francis and Richard Julian. A third founder, Eugene Julian, left the company before the dismissal.
The Julian brothers have been active in the site development/heavy highway segment of the construction industry in Delaware through Eastern States Construction.
Eugene Julian left the Eastern States as well as Benchmark and his departure triggered legal action over his stock holdings in a separate Chancery case.
Bomberger has 150 shares of stock in the company that had an original value of $1 a share.
According to the decision from Vice Chancellor Tamika R. Montgomery Reeves, remaining shareholders of the company offered him $757 a share, or $113,000.
Bomberger claimed the share as worth more than $3,900 each or nearly $600,000 for the “book value” of the stock.
Arguments in the case also centered on partners buying out Eugene Julian for more than the $1 a original share value for Benchmark stock.
While dismissing other claims filed in the suit, Montgomery-Reeves let stand the question of paying Bomberger book value for the stock.
Benchmark is one of the state’s largest homebuilders and was one of the pioneers in the 55-plus category. It is one of the builders in the Village of Whitehall, a planned community near Middletown.
Delaware saw an uptick in home construction so far in 2015, thanks in part to the state’s lower property tax rates and a steady recovery in the home-building market. The state is adjacent to New Jersey, which has among the nation’s highest property tax rates.
At the same time, national home builders have stepped up competition after pulling back during the recession of 2009.
Attorneys for both sides did not immediately respond to an Email request for comment.
Click on the link below for a copy of the decision.
8-19-16 11572-vcmr bomberger v. benchmark builders, inc. – letter opinion
