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…
LLC Operating Agreements: Indemnity, Arbitration, and Equity
LLC operating agreements frequently provide for indemnity to the LLC’s manager. This is consistent with the statutory default rule embodied by California Corporations Code section 17704.08(a),…
Diversion of LLC Funds Is Not “Protected Activity” Under California’s Anti-SLAPP Statute
California’s anti-SLAPP statute (Code of Civil Procedure section 425.16) aims to protect defendants from meritless lawsuits designed to chill “protected activity” — i.e., the exercise of…
California Supreme Court: Penal Code Section 496(c) Can Apply To Business Disputes
In a long-awaited opinion — Siry Investment, L.P. v. Farkhondehpour — the California Supreme Court held that California Penal Code section 496 can apply to a business…
Can a Statutory Buyout be Dodged by Dismissal?
The statutory right to judicial dissolution in California comes with a hook — the defendants can avoid dissolution by exercising a “buyout” procedure. This is true…
A Dissolved LLC Can Still Recover Attorney Fees
An LLC Jungle post from last year addressed the issue of whether derivative claims can be pursued for a dissolved LLC. See: Can Derivative Claims be Pursued…
Family Trusts and LLC Membership
LLC members often hold their membership interests in a family trust. The benefits of trusts are well known — they generally allow assets to be easily…
Courts Split Over Application of Penal Code to Claims of LLC Misappropriation
Almost one year ago, in Switzer v. Wood, California’s Fifth Appellate District held that an LLC manager or member participating in the theft of the LLC’s…
Can the Criminal Law Concept of “Receiving Stolen Property” Apply to LLC Disputes?
In the LLC Jungle, allegations of “misappropriation” are common. LLC members and managers sometimes improperly divert the LLC’s funds and property for their own personal use. …
The LLC Jungle Blog is Coming!
The LLC Jungle blog is coming in October 2018! The blog will cover developments in California law governing limited liability companies — the increasingly popular form…