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…
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…
Another LLC Attorney Disqualified Due to “Conflict of Authority”
A prior LLC Jungle post covered the Court of Appeal’s seminal opinion in the Jarvis v. Jarvis case here: Why Having “Co-Managers” for Your LLC is a Terrible…
The “Business Judgment Rule” Applies in LLCs Too
Corporate directors have long relied on the “business judgment rule,” under which their decisions are presumed to have been made “on an informed basis, in good…
LLC Members May Ratify Prior Defective Actions
Actions taken within business entities are sometimes deemed invalid due to procedural defects. For corporations, section 119 of the Corporations Code establishes a clear procedure by…
To Moot a Statutory Buyout, LLC’s Dissolution Must be Valid Under its Operating Agreement
In 2022, The LLC Jungle covered the opinion Friend of Camden, Inc. v. Brandt in a post titled LLC Dissolution Vote Defeats Statutory Buyout. In the…
The Perils of Buying Property from an LLC with Competing Claims to Managerial Authority
Prior LLC Jungle posts have addressed the tricky issue of LLC managerial authority in the context of the LLC’s dealings with third parties. See: LLC and…
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.…
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 —…