The expulsion of an LLC member for breach of the LLC agreement, when combined with buyout provisions that leave the expelled member with little or no return on investment, is a sure-fire recipe for litigation, as evidenced in a recent decision by Manhattan Commercial Division Justice Melvin Schweitzer in Jain v. Rasteh. Read about it in this week’s New York Business Divorce.
Continue Reading The Perils of For-Cause Expulsion Provisions in LLC Agreements
Expulsion and Removal
Divided Appeals Court Upholds Removal of LLC Member-Manager Contrary to Voting Agreement
By Peter A. Mahler on
Posted in Expulsion and Removal, LLCs
A divided panel of the Appellate Division, First Department last week upheld the removal of an LLC member-manager by majority vote of the members, notwithstanding a provision in the operating agreement requiring all members to vote for the ousted manager in any election. Learn more in this week’s New York Business Divorce.
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Continue Reading Divided Appeals Court Upholds Removal of LLC Member-Manager Contrary to Voting Agreement
LLC Member’s Marital Woes Lead to Loss of Membership Interest
By Peter A. Mahler on
This week’s New York Business Divorce examines an intriguing case involving an LLC whose operating agreement required a member to transfer his interest to the other members because of his filing of a divorce action against his wife. When the divorcing member refused to do so, he bought himself a second divorce litigation, of the business kind.
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Continue Reading LLC Member’s Marital Woes Lead to Loss of Membership Interest
Expelling an LLC Member
By Peter A. Mahler on
Expelling an unwanted member of an LLC sounds like a great alternative to dissolving the LLC, but it may not be possible or easy depending on the provisions of the Operating Agreement.
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