When an LLC operating agreement permits action upon majority consent, can a minority member nonetheless challenge that action as a breach of the majority’s fiduciary duties? The Fourth Department weighs in.
Continue Reading Can Majority-Authorized Action Still Breach Fiduciary Duty?
Chef’s Table at Brooklyn Fare. It’s not just fining dining. It’s litigation warfare.
Can a three-person minority outvote a four-person majority to oust the majority-appointed, longtime CEO of a profitable company (who also happens to be the founder of the company) in a vote requiring supermajority approval?
The math ain’t mathing, you may be saying to yourself.
But today, we explore a case—SJI Renewable Entery Ventures LLC,
This week NYBD presents its annual Winter Case Notes summarizing several recent decisions of interest.
A recent Brooklyn Supreme Court case bring useful insight on three post-dissolution fundamentals: when (and how) a dissolution can be annulled, the court’s supervisory power under BCL 1008, and why, when shareholders are deadlocked as to dissolution procedure, a public sale—not a private deal—is the default endgame.
Continue Reading Corporate Afterlife: Deadlock and Accounting in the Winding-Up Phase
The BCL § 1118 buyout election is a mighty litigation tool, capable of thwarting judicial dissolution, capable even of thwarting an injunction. But it is not a panacea. Read about the powers and limitations of the statutory buyout election in this week’s New York Business Divorce.
Continue Reading The BCL § 1118 Buyout Election: A Powerful Defense. With Limits.
While the distinction between a partner and an economic interest holder is conceptually sound, a recent decision from the Second Department shows how an assignee of an economic interest can be left not only out of the boardroom, but also out in the cold financially.
This week’s NYBD visits a recent Delaware Chancery Court decision involving, the Court wrote, a “poorly drafted” LLC agreement with “lamentable” consequences for one side that the parties “must live with.”
Continue Reading In Delaware, You Live or Die Under Your LLC Operating Agreement
New York appellate case law invariably holds that a closely-held business owner lacks a direct property interest or right in the entity’s underlying real estate asset to support a Notice of Pendency. But in this week’s New York Business Divorce, we feature an uncommon motion court decision declining to vacate a Notice of Pendency placed by an LLC member upon the entity’s real estate asset to thwart the property’s sale to a third-party buyer. Is this recent decision an outlier, or the birth of an exception to the rule?
When cash never hits the books, can an accounting still deliver meaningful relief? A recent decision offers answers—and warnings.
Continue Reading Can an Equitable Accounting Find the Missing Cash?