What do you get when you combine LLC membership interests determined by variable capital accounts with an off-the-shelf form operating agreement? Litigation, of course! Get the story in this week’s New York Business Divorce.
Continue Reading The Perils of Indeterminate LLC Membership Interests
This week’s New York Business Divorce offers its annual Winter Case Notes with synopses of half a dozen recent decisions in business divorce cases involving minority shareholder oppression, books and records proceedings, and more.
Continue Reading Winter Case Notes: Oppression of the “Gifted” Minority Shareholder and Other Recent Decisions of Interest
If you’re an LLC member or member’s lawyer thinking about expelling a misbehaving co-member, but without authorization to do so in the operating agreement, read this post and think again.
Continue Reading Repeat After Me: You May Not Expel a Member of a New York LLC Unless the Operating Agreement Says So
This week’s New York Business Divorce looks at a noteworthy decision by Manhattan Commercial Division Justice O. Peter Sherwood in which he dismissed claims by a minority member of Delaware LLCs for inspection of books and records.
Continue Reading Books and Records Case Illustrates Crucial Importance of Pre-Suit Demand
New York’s statutes authorizing a judicial dissolution petition by oppressed minority shareholders, and granting respondents a corresponding right to elect to purchase the petitioner’s shares, include a provision for a “surcharge” upon controlling shareholders for wrongful dissipation or transfer of corporate assets. It’s a rarely litigated provision, as evidenced by a court decision last month which may be the first ever reported case in which a surcharge claim was upheld. Learn more in this week’s New York Business Divorce.
Continue Reading The Elusive Surcharge in Dissolution Proceedings
Pizza’s on the menu in this week’s New York Business Divorce, or at least a dispute between co-members of an LLC that owns a popular Manhattan pizzeria. Just don’t look for any extra cheese on Justice Sherwood’s recent decision in Manzella v. Caporuscio, authorizing the majority member to terminate the minority member’s employment.
Continue Reading Pizza Chef with Bigger Piece of LLC Pie Allowed to Terminate Minority Member’s Employment
Disputes over shareholder buy-outs continue to generate interesting court decisions addressing whether the purchasing controller has an affirmative, fiduciary duty of disclosure, as in Brummer v. Red Rabbit, LLC, highlighted in this week’s New York Business Divorce.
Continue Reading Another Case of Seller’s Remorse Bites the Dust