California and Delaware LLCs are Not the Same
Most LLC members don’t give serious thought to the jurisdiction in which their LLC is formed. The general perception is that a California LLC will incur…
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);…
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…