If you’re going to require super-majority consent as to certain business decisions in a shareholder or operating agreement, be sure to draft clearly so as to leave no room for potential litigation over the level of required consent. That’s the lesson of Herbert v Schodack Exit Ten, LLC, decided earlier this month by an upstate appellate panel and highlighted in this week’s New York Business Divorce.
Continue Reading Unanimous Vote Requirement in LLC Agreement Turns on Meaning of “Commitment”
June 2013
Can’t Get Rid of Those Nooks and Crannies: Delaware Supreme Court Clarifies Implied Covenant of Good Faith and Fair Dealing
By Peter A. Mahler on
Posted in Delaware
The implied covenant of good faith and fair dealing is a much misunderstood and frequently misused legal doctrine in disputes between co-owners of business entities. A decision by the Delaware Supreme Court earlier this month provides an excellent roadmap to understand the doctrine and the ability–or not–to contract around it. It’s in this week’s New York Business Divorce. …
Continue Reading Can’t Get Rid of Those Nooks and Crannies: Delaware Supreme Court Clarifies Implied Covenant of Good Faith and Fair Dealing
Trouble Looms When Clients Negotiate Their Own Shareholder Buy-Out Settlement Agreements
By Peter A. Mahler on
Posted in Buyout, Settlement
A recent ruling by Justice Timothy Driscoll in De Well Shipping Container Corp. v. Guo highlights the uncertainties and perils when clients, without their lawyers present, negotiate and sign an informal agreement settling a shareholder dispute with a buy-out. Read about it in this week’s New York Business Divorce.
Continue Reading Trouble Looms When Clients Negotiate Their Own Shareholder Buy-Out Settlement Agreements
What Law Applies When Internal Affairs Doctrine Clashes With Choice-of-Law Clause?
It happens once in a while: the co-owners of a business entity formed under the laws of State X have a choice of law clause in their agreement opting to be governed by the laws of State Y. Such was the case in Gelman v. Gelman, recently decided by Justice Daniel Palmieri involving a dispute between sibling co-members of a Delaware LLC whose operating agreement had a New York choice of law provision. Which state’s law did the court apply? Get the answer in this week’s New York Business Divorce.
Continue Reading What Law Applies When Internal Affairs Doctrine Clashes With Choice-of-Law Clause?