The Delaware Chancery Court finally caught up with court decisions in New York and elsewhere, ruling last month in a case involving a bitcoin mining company that Delaware courts lack subject matter jurisdiction to adjudicate petitions to dissolve non-Delaware business entities. Learn more in this week’s New York Business Divorce.
Continue Reading Delaware Declines Subject Matter Jurisdiction Over Judicial Dissolution of Foreign Entities

In this week’s New York Business Divorce, a wild tale of a settlement achieved, settlement spurned, and a litigant threatened with incarceration for contempt in an intensely bitter, nine-year battle between two brothers over their Manhattan-based real property LLC.
Continue Reading A Pig in a Poke: The Rollercoaster Kadosh Settlement Litigation

Derivative actions brought by LLC members take the spotlight for the second week in a row, this time featuring a pair of noteworthy decisions involving Delaware and Nevada LLCs in which the defendants argued that the plaintiff’s right to sue derivatively was waived by the operating agreement. Learn more in this week’s New York Business Divorce.
Continue Reading Can LLC Agreement Waive Right to Sue Derivatively? Not in These Two Cases

Is the contractual freedom associated with LLC statutory default rules being used to promote efficiencies or opportunistically by LLC controllers at the expense of vulnerable LLC members? That’s the subject of a study and article by Professor Peter Molk highlighted in this week’s New York Business Divorce and accompanying interview of Professor Molk on the Business Divorce Roundtable podcast.
Continue Reading Professor Peter Molk’s Groundbreaking Study of How LLC Owners Contract Around Default Statutory Protections

A very interesting decision earlier this month by Justice Eileen Bransten in Doppelt v. Smith addressed whether a minority limited partner’s right to seek judicial dissolution was preempted by the partnership agreement’s provision authorizing dissolution upon the consent of a majority of the limited partnership interests. Read more in this week’s New York Business Divorce.
Continue Reading Court Enforces Waiver of Limited Partner’s Right to Seek Judicial Dissolution — Or Did It?

This week’s New York Business Divorce travels upstate, to Buffalo, where a most interesting dispute between 50/50 members of a realty company has played out in litigation before Justice Timothy Walker, focusing on the rights of the non-managing member to bring a derivative summary eviction proceeding against the LLC’s sole tenant.
Continue Reading Not Your Father’s Derivative Action

Delaware law’s contractarian approach is central to that state’s jurisprudence concerning limited liability companies. Last month, in Huatuco v. Satellite Healthcare, the Court of Chancery cited freedom-of-contract in dismissing an action for judicial dissolution based on its finding that the LLC agreement’s provision, limiting member rights to those expressly granted in the agreement, constituted a waiver of the right to seek judicial dissolution. This week’s New York Business Divorce asks the question, does Huatuco take contractarianism too far?
Continue Reading Contractarianism Gone Wild?

A recent decision by Westchester Commercial Division Justice Alan D. Scheinkman in Briarcliff Solutions Holdings, LLC v. Fifth Third Bank (Chicago) takes the spotlight in this week’s New York Business Divorce, featuring a battle for control of the company’s Board of Directors and, ultimately, control of a lawsuit asserting claims against one ownership faction. Don’t miss it.
Continue Reading Whose Lawsuit Is It Anyway?

Last week’s Court of Appeals decision in Pappas v. Tzolis completes a trilogy of recent decisions by that court dismissing fiduciary breach claims by disappointed sellers concerning buy-out agreements that contain releases or waivers of fiduciary duty. Learn more in this week’s New York Business Divorce.
Continue Reading Pappas Saga Ends, Court of Appeals Upholds Fiduciary Waiver in LLC Buy-Out Agreement