News & Analysis as of

Breach of Duty Membership Interest

Farrell Fritz, P.C.

Top 10 Business Divorce Cases of 2023

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Some years are easier than others to select the most significant business divorce cases. In this, the 16th year I’ve published this top-10 list, the task is made especially difficult by a veritable flood of court decisions...more

Cadwalader, Wickersham & Taft LLP

Title (Coverage) Not Available

Two recent decisions concerning title insurance illustrate that an insured’s negligence can result in an exclusion from coverage and that title insurers generally do not owe a fiduciary duty to their insureds....more

Patton Sullivan Brodehl LLP

Derivative Claim Standing: Both Contemporaneous And Continuous Membership Required

When an LLC suffers primary harm that also indirectly harms the LLC’s members, the cause of action generally belongs to the LLC, not its members. Only if the LLC (through its duly authorized management) fails to pursue the...more

Farrell Fritz, P.C.

Disguised Agreements and Dissolution

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Appearances can be deceiving. - That, essentially, was the argument made in two recently decided cases involving claims for judicial dissolution. ...more

Patton Sullivan Brodehl LLP

Portrait of a Mangled Business Divorce

Business divorce can be messy, as reflected by many of the cases covered here at The LLC Jungle. Two issues that frequently arise during the dissolution of an LLC are: 1. the statutory buyout procedure, and 2. claims for...more

Gray Reed

Villareal v. Saenz: Fiduciary Duties Will Go On

Gray Reed on

In Villareal v. Saenz, a district court magistrate judge for the Western District of Texas, San Antonio Division, has recognized that members exiting a limited liability company may continue to hold fiduciary duties despite...more

Farrell Fritz, P.C.

Court Enjoins Dilution of Brewing Company LLC Membership Interest

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Most folks associate beer with pleasure. Many craft brewers will tell you they went into business for that reason: to make themselves and others happy (and, oh yeah, make money). ...more

Dorsey & Whitney LLP

2020 Recap: Corporate Restructuring Review

Dorsey & Whitney LLP on

Amidst a global pandemic, there were plenty of interesting bankruptcy and restructuring events and changes that occurred in 2020. We saw new Bankruptcy Code amendments go into effect (through the Small Business Reorganization...more

Winstead PC

Court Affirms The Equitable Forfeiture Of A Manager’s Partnership Interest Due To Breach Of Fiduciary Duty And Discussed...

Winstead PC on

In Michael D. Heatley v. Red Oak 86, L.P. & Charles Johnson, investors in a limited partnership sued the managing member for breach of fiduciary duty. No. 05-18-01083-CV, 2020 Tex. App. LEXIS 6592 (Tex. App.—Dallas August 17,...more

Farrell Fritz, P.C.

Two Entities, Two Outcomes: Withdrawal and the Right to an Accounting

Farrell Fritz, P.C. on

In Jacobs v Cartalemi, now the leading case on the subject of LLC member withdrawal (which our firm had the pleasure of litigating), the Appellate Division – Second Department repeated a well-established principle of law:...more

Farrell Fritz, P.C.

A Trio of Recent Business Divorce Decisions by Manhattan Commercial Division Judges

Farrell Fritz, P.C. on

The COVID-19 pandemic kept New York’s courthouses dark the last few months, but it didn’t slow down the output of decisions by Commercial Division judges. If anything, the pause of new case filings and non-emergency motions...more

Farrell Fritz, P.C.

LLC Member’s Petition to Dissolve Boxing Club Dealt First Round KO

Farrell Fritz, P.C. on

In the end, it wasn’t much of a fight. The case of Huggins v Scott, decided last month by Justice W. Franc Perry of the Manhattan Supreme Court, illustrates anew the well-nigh insurmountable hurdle faced by a minority...more

Patton Sullivan Brodehl LLP

LLC Distributions, Charging Orders, and Manager Fiduciary Duties

There are not many published California Court of Appeal opinions providing guidance for LLC managers and members. That’s why it’s an “LLC Jungle” out there. While unpublished opinions are not binding precedent outside of...more

Farrell Fritz, P.C.

Operating Agreement Defeats Statutory Buyout Rights Upon LLC Member’s Withdrawal

Farrell Fritz, P.C. on

When the tsunami of LLC enabling statutes swept the U.S. in the late ’80s and early ’90s, including New York in 1994, many included a default rule authorizing as-of-right member withdrawal and payment for the “fair value” of...more

Farrell Fritz, P.C.

Sole Owners of Close Corporation and LLC Discover They're Not So Sole

Farrell Fritz, P.C. on

What makes a shareholder a shareholder? What makes an LLC member a member? The simplicity of the questions belies the difficulties and endlessly unique fact patterns encountered in case after case involving close...more

Butler Snow LLP

The Tennessee Business Court Tackles Privilege Claims

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The Tennessee Business Court has provided additional guidance to commercial litigators concerning internecine legal battles between members of limited liability companies. The Court has determined the fiduciary duties of...more

Butler Snow LLP

The Tennessee Business Court Clarifies Fiduciary Duties of LLC Members

Butler Snow LLP on

In a recent opinion, decided 12/22/15, the Tennessee Business Court clarified the circumstances under which members of a Tennessee limited liability company owe fiduciary duties to one another. In Ewing v. Miller, Case No....more

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