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News & Analysis as of

Do Equities Militate Against Restrictions Barring Petition for Dissolution?

Delaware courts often emphasize the freedom of contract of parties to define their rights, powers, duties, obligations, liabilities and restrictions in a limited liability or operating agreement under the Delaware Limited...more

Court Of Chancery Explains Claims Available To LLC Members

This is an interesting decision because it explains what direct claims are available to investors in an LLC. That is not always an easy question to answer. After all, some claims (including those involved in this case)...more

2015 Legislative Changes to Florida's Limited Liability Company Act

During the 2015 legislative session, the Florida legislature adopted amendments to Chapter 605 of the Florida Statutes. Chapter 605 is the Florida Revised Limited Liability Company Act (Florida Revised LLC Act). The bill...more

Court Of Chancery Orders Dissolution Despite LLC Agreement Bar

This decision may answer the question of whether an LLC Agreement’s bar of dissolution without a member’s consent trumps the statutory remedy of court-ordered dissolution when the entity’s purpose cannot be achieved any...more

Court Sorts Out California RULLCA Transition Muddle

Monday, I wrote about Kennedy v. Kennedy, 2015 Cal. App. LEXIS 329 (Apr. 20, 2015).  That post discussed the Court of Appeal’s holding that under the General Corporation Law the dismissal of a cause of action for involuntary...more

Member Rights in Kentucky Limited Liability Companies

All members of Kentucky Limited Liability Companies, whether they hold a majority or minority membership interest, have rights under Kentucky statutory and common law, but these rights may be modified, curtailed or extended...more

Court Of Chancery Permits Equitable Dissolution

In this precedent-setting decision, the Court upholds the right of an assignee of an LLC interest to petition for its dissolution....more

Limited Liability Companies: Handle Bankrupt LLC Members With Care

Walro v. The Lee Group Holding Co., LLC (In re Lee), 524 B.R. 798 (Bankr. S.D. Ind. 2014) – A chapter 7 trustee sought a court determination that (1) a debtor’s voting rights in a limited liability company (LLC) were...more

FINRA Issues Notice on New Rules and Amendments Relating to Transaction-Based Compensation, Membership and Sanctions

The Financial Industry Regulatory Authority released Regulatory Notice 15-07 to alert member firms of the new consolidated rules regarding payments to unregistered persons and membership. The notice also alerts member firms...more

Superior Court of New Jersey Pierces the “LLC” Veil, Holding Sole Member Liable for Environmental Liabilities

On February 26, 2015, in Coty US LLC v. 680 S. 17th Street LLC, the Superior Court of New Jersey, Chancery Division, pierced the veil of a New Jersey limited liability company and held its sole member liable for environmental...more

Protecting an LLC From A Wayward Member While Maintaining SBA Eligibility

When creating a limited liability company (“LLC”), members are often so concerned with getting the company established–and anticipating problems that may arise with third parties, be it suppliers or customers–that they fail...more

A Cautionary Tale: Members of a Defunct LLC May Have Liability For Attorney Fees

In CB Richard Ellis Inc. v. Terra Nostra Consultants the California Court of Appeal for the Fourth Appellate District decided an interesting issue concerning the liability of an LLC member for a fee award imposed against the...more

Member-Employees of Limited Liability Companies

Every now and then, the question arises: can an owner of a limited liability company (LLC) also be an employee of that company? The answer boils down to how the LLC elects to be taxed. ...more

Judge Rules Against FTB In “Doing Business” Definition

Over a year ago, I wrote about an Iowa corporation, Swart Enterprises, Inc., which operates a 60 acre farm in Kansas. Swart has no physical presence in California. It owns no real or personal property in California. However,...more

Limited Liability Company Members May Be Held Liable After a “De Facto” Dissolution of the Entity

Court Of Appeal, Fourth Appellate District (October 7, 2014)- One of the advantages of the Limited Liability Company (“LLC”) structure is, not surprisingly, that it generally limits the liabilities of its Members. One...more

Editorial: Fla. Sets Strict Standard For Direct Shareholder Claims

Florida recently clarified the limited circumstances in which a corporate shareholder or limited liability company member has standing to bring a direct claim for damages relating to the company. On July 9, in Dinuro...more

Can You Replace Your Manager? Delaware Case Emphasizes the Importance of Carefully Considering LLC Agreement Provisions

Common sense might lead one to expect that a controlling stakeholder has the power to replace the manager of a limited liability company (LLC), but this might not be the case when the underlying LLC agreement provides...more

Case Alert: What LLPs need to do following the Clyde & Co decision

In Clyde & Co LLP v Bates van Winkelhof, the Supreme Court decided that a member of an LLP (who was also a full equity partner) was a “worker” for the purposes of whistleblowing legislation. Although the judgment does not...more

Implications of the New California LLC Act

On January 1, 2014, a new law governing limited liability companies (“LLCs”) went into effect in California. The California Revised Uniform Limited Liability Company Act (“RULLCA”)1 superseded in its entirety the prior...more

A Member of a Limited Liability Partnership Can be a “Worker”

Background - The rights conferred on an individual working in the UK depend on his or her employment status. An individual can be: (a) an employee; (b) self-employed; or (c) a “worker”. Employees enjoy the greatest...more

Authorized Signors of Loan Documents

One of the threshold issues to consider in loan transactions is determining who is authorized to sign the loan documents on behalf of entity borrowers. This is important not only in cases where the entity is the borrower but...more

California’s Revised Uniform Limited Liability Company Act

A new California law governing limited liability companies became effective as of January 1, 2014. The California Revised Uniform Limited Liability Company Act (RULLCA) makes significant changes in the rights and...more

Tengberg, Celentino, and Bistrow Author Article on Restructuring Private Golf Clubs

Partners Van A. Tengberg, Christopher Celentino, and Mikel R. Bistrow authored an article in the July 2013 issue of Golf Inc. Monthly titled, “Restructuring the Private Club: How to Deal With Refundable Membership Liability.”...more

AIFMD: Update for non-EEA fund managers

From 22 July 2013, the Alternative Investment Fund Managers Directive (2011/61/EU) (the “Directive”) and the supplementary level 2 Regulation (EU) No 231/2013 (the “Regulation”) will come into effect. This legislation will...more

European Commission Proposes First Significant Changes to Community Trademark System in over 15 Years

The European Commission recently issued draft legislation proposing to make the first significant changes to the European Union (“EU”) system of trademark protection since the establishment of the Community Trademark (“CTM”)...more

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