The test for dissolution of an LLC includes whether its purpose as defined in the LLC agreement is no longer achievable. This week’s New York Business Divorce looks at cases, including a Delaware Chancery Court decision released days ago, in which courts have looked outside the agreement to determine the LLC’s purpose.
Continue Reading Finding Purpose Outside the LLC Agreement
Last week the Delaware Supreme Court ruled in the Auriga Capital v. Gatz case, previously covered in this blog, affirming on contract grounds Chancellor Leo Strine’s finding of fiduciary breach by an LLC manager but dismissing as dicta his analysis that Delaware LLC managers owe traditional default duties of loyalty and care unless eliminated or modified in the operating agreement. It’s important, and it’s in this week’s New York Business Divorce.
Continue Reading Delaware Supreme Court Reboots Question of LLC Manager’s Fiduciary Duties
No one does “fair value” like the Delaware Court of Chancery. This week’s New York Business Divorce highlights three recent share appraisal decisions by that court, whose penetrating legal analysis of valuation issues leads the way for courts across the country.
Continue Reading Recent Fair Value Cases in the Delaware Chancery Court
Last week’s New York Business Divorce looked at Auriga Capital v. Gatz in which Chancellor Leo Strine of the Delaware Chancery Court undertook a comprehensive analysis of LLC manager fiduciary duties under Delaware law. This week’s post takes a comparative look at New York LLC manager duties.
Continue Reading What Does Chancellor Strine’s Auriga Capital Decision Teach Us About Fiduciary Duties of New York LLC Managers? (Part Two)
In the first of a two-part series, this week’s New York Business Divorce looks at the Delaware Chancery Court’s important decision last month in Auriga Capital v. Gatz in which Chancellor Leo Strine, Jr. sets forth an analytic framework for imposition of fiduciary duties on managers of Delaware LLCs. Next week’s post will compare the law governing fiduciary duties of New York LLC managers.
Continue Reading What Does Chancellor Strine’s Auriga Capital Decision Teach Us About Fiduciary Duties of New York LLC Managers? (Part One)
A recent and controversial decision by the Delaware Chancery Court highlights the need for counsel drafting multiple-member LLC operating agreements to focus attention on whether, and if so the circumstances under which, a member may transfer its membership interest, including economic and voting rights, to another existing member with or without the other members’ consent. Learn more about this important case law development in this week’s New York Business Divorce.
Continue Reading Avoiding the Pain of Achaian, or How Not to Draft LLC Membership Transfer Provisions