A Manhattan panel of appellate judges last month enforced an LLC operating agreement’s provision giving the manager sole discretion — even at his “whimsy” or “impetuously” said the court — to determine a member’s sharing ratio of the firm’s profits. It’s worth reading in this week’s New York Business Divorce.

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This week and next, New York Business Divorce examines two recent First Department decisions clarifying the standards for overcoming general releases given in the context of transactions with fiduciaries in closely held business entities, where the plaintiffs allege that the fiduciary fraudulently induced them to enter into the transaction. This week’s focus is on Centro Empresarial Cempresa S.A. v. America Movil S.A.B. de C.V., 2010 NY Slip Op 04719 (1st Dept June 3, 2010).

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Does a minority member of an LLC have a right to intervene in an action against the LLC by a creditor? How about if the creditor’s claim arises from collusion or other impropriety by the controlling member? This week’s New York Business Divorce provides answers courtesy of a recent appellate court ruling in the curious case of Baron v. Rocketboom LLC.

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