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…
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…
A Poke Bowl Full of Breached LLC Duties
LLC litigation involves many complex issues, and it’s not always easy to allege a claim properly. Some cases never get out of the starting gate, with…
LLCs Can Assert Offensive Claims Against Members
In “business divorce” litigation involving LLCs, it is common to see a disgruntled LLC member asserting claims against the LLC’s manager. Depending on the type of…
LLC Manager’s Conduct Benefits Her Side Entity at the Expense of the LLC — Are the Claims Against Her Direct or Derivative?
The distinction between direct and derivative claims is a recurring theme on The LLC Jungle. In a nutshell, under California law, an LLC (just like a…
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. …
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…
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…
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…
LLC Derivative Claims — Sometimes It’s “Now or Never”
One substantial LLC membership right in California (and most other states) is the ability of members to file a “derivative” lawsuit. If the LLC has suffered…