In this week’s New York Business Divorce, companion appellate decisions issued last week in the long running Kassab v Kasab litigation emphasize the fundamental legal differences between corporate and LLC dissolution, with allegations of majority “oppression” sufficient to grant dissolution in one case, but so insufficient as to require pre-answer dismissal in the other.
Continue Reading To Dissolve or Not to Dissolve, that is the Question. The Answer is Both.
“Intentional” Breach of Fiduciary Duty Defeats Operating Agreement’s Exculpatory Clause
In this week’s New York Business Divorce, we consider a recent appellate decision addressing the effectiveness of LLC operating agreement “exculpatory” clauses to shield the company’s managers or members from personal liability for misconduct. With the latest decision, the roster of New York appeals court cases to consider this important legal issue grows from a trio to a quartet.
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Battle of the Estoppels
Business divorce lawsuits often come in pairs (or trios), making preclusionary principles like estoppel a recurring phenomenon. In this week’s New York Business Divorce, we consider an appeals court’s recent take on three competing estoppel doctrines arising from the same law firm limited liability partnership breakup.
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Unsigned, Non-Final Operating Agreement Trumps Conflicting Testamentary Bequest of LLC Interest
In this week’s New York Business Divorce, we tackle two important legal issues for LLC owners. First, the circumstances in which an upon-death membership interest transfer provision in an unsigned, non-final operating agreement may be enforced. Second, whether a membership interest transfer provision in an operating agreement trumps a conflicting bequest in a last will and testament.
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The Oral Partnership Operating as a Corporation: Is it a Partnership? A Corporation? Can it be Both?
In this week’s New York Business Divorce, learn if it’s possible to plead the existence of a viable oral partnership whose business operated in the form of a corporation or limited liability company. The short answer: yes it can be done, but it’s not easy to do.
Continue Reading The Oral Partnership Operating as a Corporation: Is it a Partnership? A Corporation? Can it be Both?
“Informal Dissolution” and Individual Liability
In this week’s New York Business Divorce, read about the unhappy consequences under the “informal dissolution” doctrine to befall a corporate director who effectuated the liquidation of a defunct corporation’s assets without providing statutory notice of dissolution to the entity’s creditors.
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The Farro Litigation: The Rest of the Story
This week’s New York Business Divorce is a follow-up to last week’s article, a piece about the enormously important appellate decision in the Farro case, the first to carefully consider the correct meaning and interpretation of New York’s LLC merger statute and its relation to the analogous corporation merger statute. In this week’s article, learn about the rest of the story in the Farro litigation, addressed in two companion appellate decisions issued the same day.
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The Injunction Remedy in Business Divorce Cases
In this week’s New York Business Divorce, read about one of the most mighty and effective litigation tools for business divorce lawyers and their clients: the injunction.
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An Extreme Case of Petitioner’s Remorse
In this week’s New York Business Divorce, read about the hurdles one can face when attempting to change course after suing for, or stipulating to, dissolution. The lesson: when suing for dissolution, be prepared to see it through to the bitter end.
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When Estate Plans and Stock Transfer Restrictions Collide
In this week’s New York Business Divorce, we discuss a recent decision serving as a reminder to corporate shareholders planning to bequeath their shares of stock to ensure no contracts prohibit them from doing so, lest they leave behind a very disappointed beneficiary.
Continue Reading When Estate Plans and Stock Transfer Restrictions Collide