Operating Agreement Doesn’t Excuse Breach of Fiduciary Duty
Many posts on The LLC Jungle blog have focused on the fiduciary duties owed by LLC managers to both the LLC’s members and the LLC itself.…
Derivative Claim Upheld for Estate of Deceased LLC Member
Asserting claims derivatively on behalf of an LLC, as opposed to directly on behalf of an LLC member, can be tricky business for even experienced litigators. …
Partnership — Not Its Partners — Owns Malpractice Claim Against Partnership’s Attorney
Two important principles governing corporate entities are: (1) the entity is legally distinct from its owners; and (2) the entity’s property and assets belong to the…
Does an LLC’s Bankruptcy Discharge Apply to the LLC’s Alter Egos?
When a debtor LLC receives a discharge order from a bankruptcy court, a creditor is prevented from enforcing any preexisting debts against the discharged LLC as…
Another Case Addressing Managerial Discretion and the Implied Covenant of Good Faith and Fair Dealing
LLC managers often enjoy wide latitude and unrestricted “discretion” under the LLC’s operating agreement. At the same time, all contracts — including LLC operating agreements —…
Receiver for LLC Can be Bound by Operating Agreement’s Arbitration Provisions
Courts often appoint receivers to manage the affairs of LLCs when the internal management is conflicted or broken. General equity receivers (as opposed to more limited…
The “DAO Jungle” Chronicles: Federal Judge Upholds Treasury Department’s Sanction of Tornado Cash for Involvement in Laundering Hacking Proceeds
This post was primarily authored by Daniel Zarchy, a “Rising Star” for five of the past six years who is a litigation attorney at Patton Sullivan…
Alter Ego — No Single Factor is Determinative
Alter ego liability is again the flavor of the day. (See here for a list of all prior “alter ego” related posts.) As previously covered, the…
LLC is Not an “Indispensable Party” to Direct Claims Between LLC Members
In litigation, the plaintiff must include as parties to the action all persons or entities whose interests are so directly involved that the court cannot render…
“Equitable Buyout” as a Remedy for LLC Wrongdoing?
In the world of LLCs, buyouts — where one member sells his/her membership interest to another member or the LLC itself — are commonplace. Buyouts generally…