In a recent decision by Justice Andrea Masley, the court dismissed a petition to dissolve a realty holding LLC based on the operating agreement’s broad purpose clause of the any-lawful-business type. Get the full story in this week’s New York Business Divorce.
Continue Reading The Purposeless Purpose Clause Rides Again
It’s time for another cross-country trip in this week’s New York Business Divorce which summarizes a quintet of recent appellate decisions in business divorce cases by courts outside New York.
Continue Reading Business Divorce Nation: A Cross-Country Tour of Recent Decisions of Interest
Can an LLC member with a put option–the right to sell his interest back to the LLC–exercise that option when doing so will render the LLC insolvent? This week’s New York Business Divorce post highlights a recent decision by Justice Masley of the New York County Commercial Division considering this issue.
Continue Reading Departing LLC Members: Exercise Your Put Option Before Insolvency Approaches
In this week’s New York Business Divorce, we tackle the rules governing enforceability of oral partnership, shareholder, and operating agreements, including a first-impression appeals court decision addressing the validity of an alleged oral modification of written limited partnership agreement under New York’s Revised Limited Partnership Act.
Continue Reading Enforceability of Oral Operating, Shareholder, and Partnership Agreements
“Can I withdraw?” is a question frequently posed by unhappy LLC members to their legal counsel. This week’s New York Business Divorce features a recap of a highly informative conversation on that topic conducted on the Listserv of the ABA Business Law Section’s Committee on LLCs, Partnerships and Unincorporated Entities.
Continue Reading Does an LLC Member Have Absolute Power to Withdraw from the LLC?
What is it about LLCs that spawn so many lawsuits over member status and percentage interests? This week’s New York Business Divorce may not have the answer, but it does highlight a trio of recent court decisions involving disputed ownership claims.
Continue Reading Disputes Over Member Status Continue to Roil the LLC Waters
In this week’s New York Business Divorce, read about the exceedingly versatile cause of action of breach of fiduciary duty and the many remedies courts may award upon a finding of breach. This week’s post focuses on two remedies in particular: disgorgement of profits obtained through self-dealing, and recovery of attorneys’ fees when pled derivatively.
Continue Reading The Common-Law Tort of Breach of Fiduciary Duty: The Total Package
It’s been almost 12 years since Bernie Madoff’s Ponzi scheme exploded, inflicting billions in losses on thousands of investors. This week’s New York Business Divorce examines a first-impression ruling by Manhattan Commercial Division Justice Joel M. Cohen in which he upheld a plan of liquidation of a dissolved Madoff feeder fund organized as an LLC.
Continue Reading Business Judgment Rule Prevails in Fight Over Liquidation Plan for Dissolved Madoff Feeder Fund
The months-long shutdown of New York courts due to the COVID-19 pandemic did not stop the judges of the Manhattan Commercial Division from issuing a number of noteworthy decisions in business divorce cases. This week’s New York Business Divorce highlights three of them.
Continue Reading A Trio of Recent Business Divorce Decisions by Manhattan Commercial Division Judges
Man marries and has a daughter. He executes an operating agreement providing for his wife and daughter to take his LLC interest upon death. But the man has an alleged mistress, who allegedly begets a daughter out of wedlock. The man then executes a will providing for his alleged mistress and out-of-wedlock daughter to take his LLC interest upon death, contrary to the operating agreement. What could go wrong? You can read about this steamy litigation in this week’s New York Business Divorce.
Continue Reading How to Resolve Competing Estate Plans of an LLC Owner with a Double Life