For LLC lawyers and their clients who are concerned about climate change, the post under the link below may be of great interest: https://www.mofo.com/resources/publications/181030-delaware-transparancy-sustainability-standards.html
Operating agreements for multi-member LLCs often contain non-competition provisions. Massachusetts lawyers who draft these agreements or who draft non-Massachusetts operating agreements intended to be effective in Massachusetts should be aware of Massachusetts’ new and stringent statutory restrictions on non-competition agreements. These restrictions undoubtedly apply to non-competition provisions in operating agreement. For an excellent overview of the new Massachusetts statute, click here: https://www.ebglaw.com/news/massachusetts-passes-new-law-governing-non-competition-agreements/
If your state’s LLC act provides members with the right to expel other members (as, for example, New Hampshire’s does under RSA 304-C:104), you can skip the post by Peter Mahler under the link below. But if it doesn’t, you’d better read his post!
Under the link below is a post by Peter Mahler, the world’s expert (in my opinion) on disputes among LLC members and managers. His post is about a “weaponized” LLC—i.e., one in which the majority have very substantial rights vis a vis the minority under the governing operating agreement. In my experience, “weaponized” LLCs are common; I’ve formed more than a couple myself.
In any disputes among members and managers of LLCs, the inspection rights of the members are likely to be key to resolution of these disputes. The post in the NY Business Divorce blawg under the link below summarizes several key cases addressing inspection right issues.
LLC managers who want to sue their LLC’s law firm for malpractice, and the LLCs and members, should first read the following case:
Reynolds v. Henderson & Lyman et al., No. 17-1999, 2018 WL 4348013 (7th Cir. Sept. 12, 2018).
The basic lesson: Manager can’t sue on his own behalf unless the LLC’s law firm is also the manager’s law firm.
The controlling members of LLCs often want to obtain waivers from minority members of their statutory appraisal rights. Under the link below is a useful post about a recent Delaware case addressing the validity of these waivers under Delaware corporate law; but the reasoning and holding in the case is readily applicable to LLCs—and not only in Delaware but also, I suspect, in many other states.
Under the link below is a new post from Peter Mahler about an October 5 NY decision about whether inactive members of LLCs have LLC fiduciary duties. The issue is of obvious importance in all U.S. jurisdictions.
Under the following link is another excellent post about a recent case addressing the above issue: https://www.pbwt.com/ny-commercial-division-blog/commercial-division-holds-that-fiduciary-duties-limit-llc-majority-members-ability-to-adopt-amendments-aimed-at-freezing-out-minority-members/#page=1
Delaware has recently made a number of important amendments to the Delaware Limited Liability Company Act. Most of these amendments became effective on August 1, 2018. Lawyers who draft operating agreements under the Delaware Act need to have a detailed knowledge of these amendments.
For an excellent overview of them, click here: