More on the “Continuous Ownership” Requirement for LLC Derivative Claim Standing
If an LLC has been harmed but the LLC’s management fails to act to pursue a remedy, a member of the LLC can file a derivative…
Bankruptcy Stay Prevents Removal of Limited Partnership’s General Partner
Under California’s Uniform Limited Partnership Act, a general partner’s bankruptcy filing causes the general partner’s automatic dissociation from the limited partnership and termination of management rights. …
LLC Manager Causing the LLC to Pay Its Debt to a Related Entity is Not a Breach of Fiduciary Duty
The spectrum of LLC manager conduct that potentially constitutes an actionable breach of fiduciary duty is broad and varied, and the claims are almost always resolved…
Sham LLC Election Leads to Standing Defect and Vacation of $20 Million Judgment
The LLC Jungle has frequently posted on a common battleground issue in LLC litigation: authority to act for the LLC. (See here for a few posts…
LLC Buyout Dispute Hinges on Parol Evidence Rule and Integration Clause
California’s “parol evidence rule” codified in Code of Civil Procedure section 1856 and Civil Code section 1625 provides that when parties enter an integrated written agreement,…
Rescission of an LLC Deal and the Attorney Fee Award Aftermath
The right to contractual attorney fees for parties “prevailing” in litigation is covered by a deep body of case law. So is the concept of rescission…
Lost Motion for Bond at Outset of Derivative Case Does Not Preclude Later Award of Prevailing Party Costs
As a safeguard against frivolous derivative lawsuits brought “on behalf of” an LLC, Corporations Code section 17709.02 allows a defendant to file a motion for an…
An Inherited LLC Interest is not a Full Membership Interest
Under California Corporations Code section 17701.02(r), an LLC membership interest includes three components: a transferable interest (right to receive distributions in accordance with the operating agreement);…
The Sometimes Fuzzy Line Between Representing an LLC and its Members
A prior LLC Jungle post — An LLC’s Attorney Represents the LLC’s Members Too, Right? — covered the Sprengel v. Zyblut opinion, which confirmed the general rule…
Can a California Court Order Managerial Removal for a Delaware LLC?
Under the “internal affairs doctrine,” the laws of an LLC’s state of formation will usually govern matters concerning its internal affairs — i.e., matters peculiar to…