This week’s New York Business Divorce undertakes a post-mortem of sorts on a case involving the judicial dissolution of a pathology medical practice with 50/50 shareholders.
Continue Reading The Pathology of Deadlock Dissolution
In this week’s New York Business Divorce, read about a multi-year litigation odyssey culminating in the statute-of-limitations dismissal of a claim for misappropriation of an alleged corporate opportunity to own land based upon the date of execution of the contract of sale rather than the closing of the real estate purchase.
Continue Reading A Litigation Odyssey
Two-member, 50/50 LLCs are natural fodder for deadlock. This week’s New York Business Divorce questions whether New York’s standard for LLC dissolution takes too narrow an approach to deadlock.
Continue Reading Has the Time Come for New York to Follow Delaware and Officially Pronounce Deadlock as Ground for LLC Dissolution?
One of the more interesting defenses in judicial dissolution cases alleging deadlock is that the petitioner itself contrived or manufactured the deadlock for the purpose of achieving dissolution. It’s a defense long ago recognized in cases involving close corporations, and only more recently in cases involving LLCs, including a decision this month by the Delaware Chancery Court. Learn more in this week’s New York Business Divorce.
Continue Reading Contrived LLC Deadlock Doesn’t Cut the Delaware Dissolution Mustard
Does an LLC’s member’s pulling the trigger on a shotgun buy-sell agreement foreclose a petition for deadlock-based dissolution? Not if the members can’t agree on the terms of the sale, holds Vice Chancellor Slights.
Continue Reading Holes in Shotgun Buy-Sell Agreement Keep Deadlock Dissolution Petition Alive
This week’s New York Business Divorce offers its annual Winter Case Notes with synopses of four noteworthy decisions by courts in New York and Iowa.
Continue Reading Winter Case Notes: Dissolution of Not-For-Profit Corporation and Other Decisions of Interest
The interaction between an LLC’s operating agreement and a subsequent, informal deal between the members raises difficult questions surrounding the enforceability of either agreement. In a recently-filed Manhattan Commercial Division case, the Court granted the plaintiff a preliminary injunction, signaling to the parties that the plaintiff was likely to succeed on his claim to enforce the informal deal notwithstanding arguably contrary provisions in the operating agreement. The case reminds us that the formality requirements of an LLC operating agreement may give way to an informal agreement when both LLC members manifest their intent to be bound by the informal agreement.
Continue Reading A Shotgun Buy-Sell Agreement and an Email Deal Walk into a Beachside Bar . . .
Serving as the tiebreaker on a equally divided board of directors can be a thankless task, which puts it mildly when one faction sues to remove the tiebreaker. This week’s New York Business Divorce highlights a noteworthy case in which a 50% member of a Delaware LLC claimed the right to unilaterally remove the designated tiebreaker.
Continue Reading It Takes Two to Remove a Tiebreaker
Can a shotgun turn into a minefield? The answer is “yes” judging from a recent decision by Manhattan Commercial Division Justice Andrew Borrok finding a defective exercise of provisions in an LLC agreement for a deadlock-triggered shotgun buy-out. Read about it in this week’s New York Business Divorce.
Continue Reading LLC Member Pays the Price For Not Sticking to Deadlock-Breaking Script
In this week’s New York Business Divorce, we consider a remarkably thoughtful opinion by Commercial Division Justice Jennifer G. Schecter containing some noteworthy hints about the future of LLC dissolution claims in light of the coronavirus pandemic and its catastrophic economic impact on New York closely-held businesses.
Continue Reading Will the Pandemic Be a Boon for Future LLC Dissolution Claimants?