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);…
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…
Operating Agreement Cannot Waive Member Right to Seek Judicial Dissolution of LLC
Among the important rights held by members of California LLCs is the right to file a lawsuit requesting a decree of judicial dissolution of the LLC. …
What if an LLC’s Books and Records Contain Trade Secrets?
One of the most important rights owned by LLC members is the right to inspect the LLC’s books and records. For an overview of LLC books…
You Come at the LLC Manager, You Best Not Miss
In a popular TV series (The Wire), a well-known quote is: “You come at the king, you best not miss.” The idea is that if you’re…
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…
The “Minority Interest Discount” in LLC Statutory Buyouts
A prior post — Statutory LLC Buyouts – “Fair Value” vs. “Fair Market Value” — covered an unpublished opinion filed in 2021 addressing the difference between…
Appointing a Receiver to Safeguard Against LLC Shenanigans
A prior post — A Receiver For Your LLC? — covered the basics of court-appointed receivers acting on behalf of an LLC. It is always worth…