In this week’s New York Business Divorce, read about a first-of-its-kind decision announcing the existence under New York law of a potentially viable claim for common-law LLC dissolution.
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LLCs
The Purposeless Purpose Clause Rides Again

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.…
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Business Divorce Nation: A Cross-Country Tour of Recent Decisions of Interest
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. …
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Departing LLC Members: Exercise Your Put Option Before Insolvency Approaches

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. …
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Enforceability of Oral Operating, Shareholder, and Partnership Agreements

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.…
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Does an LLC Member Have Absolute Power to Withdraw from the LLC?

“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. …
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Disputes Over Member Status Continue to Roil the LLC Waters

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. …
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The Common-Law Tort of Breach of Fiduciary Duty: The Total Package

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.…
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Business Judgment Rule Prevails in Fight Over Liquidation Plan for Dissolved Madoff Feeder Fund

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. …
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A Trio of Recent Business Divorce Decisions by Manhattan Commercial Division Judges

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. …
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