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Corporate Governance Corporations Code Limited Liability Company (LLC)

Patton Sullivan Brodehl LLP

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A prior post — Statutory LLC Buyouts – “Fair Value” vs. “Fair Market Value” — covered an unpublished opinion filed in 2021 addressing the difference between the statutory buyout processes governing California corporations and...more

Allen Matkins

Diversity May Be Hard To Find When It Comes To LLCs

Allen Matkins on

Professor Eugene Volokh recently highlighted a decision by U.S. District Judge Brian Cogan taking a plaintiff to task for inadequately pleading diversity jurisdiction when the defendant is a limited liability company. ...more

Allen Matkins

What About Acts By Members That Are Not Apparently For Carrying On In The Ordinary Course Of An LLC's Business?

Allen Matkins on

California's version of the Revised Uniform Limited Liability Company Act provides that in the case of a member managed limited liability company provides...more

Allen Matkins

The One Where Everyone Got The Statute Wrong

Allen Matkins on

In yesterday's post, I discussed the Court of Appeal's unpublished opinion in Milks v. Affirmed Techs., LLC,  2024 WL 1502944 (Cal. Ct. App. Apr. 5, 2024), reh'g denied (Apr. 30, 2024).  That case involved claims against a...more

Allen Matkins

A California LLC Endures Forever, A Nevada LLC Not So Long

Allen Matkins on

California's Revised Uniform Limited Liability Company Act endows limited liability companies with a certain level immortality.  Corporations Code Section 17707.06(a) provides...more

Allen Matkins

California May Soon Define "Corporation" To Include That Are Not Corporations

Allen Matkins on

The California Corporations Code is a misnomer.  While the Corporations Code does in fact govern corporations, it also governs a wide variety of unincorporated entities, including general partnerships, limited partnerships,...more

Allen Matkins

California Court Opines On Fiduciary Duties Of LLC Members And Covenants Not To Compete

Allen Matkins on

Yesterday, the Fourth District Court of Appeal issued a noteworthy opinion addressing at least two significant questions.  Samuelian v. Life Generations Healthcare, LLC, 2024 WL 3878448....more

Allen Matkins

Not Every California Corporation Is Governed By The California General Corporation Law

Allen Matkins on

The California General Corporation Law is part of the California Corporations Code, but not every corporation incorporated in California is formed or governed by the General Corporation Law.   In fact, the Corporations Code...more

Allen Matkins

What Egregious Error Have Courts Made Nearly 9,000 Times (And Counting)?

Allen Matkins on

In a recently published article, Professors Samantha J. Prince & Joshua P. Fershée focus on the propensity to conflate corporations with limited liability companies...more

Allen Matkins

Does LLC Cancellation Constitute An Affirmative Defense?

Allen Matkins on

Section 17707.08(c) of the California Corporations Code provides...more

Allen Matkins

What Happens When An LLC Member Dies?

Allen Matkins on

To every member of a limited liability company who is a natural person, death will come "soon or late".   The California Revised Uniform Limited Liability Company Act provides that an individual dissociates as a member when...more

Allen Matkins

May A Cancelled Limited Liability Company Convey Property?

Allen Matkins on

When a California limited liability company files a certificate of cancellation its powers, rights, and privileges cease.  Cal. Corp. Code § 17707.08(b)(2)(C).  This seemingly would preclude any further activity by the LLC,...more

Allen Matkins

Common Law And The California Revised Uniform Limited Liability Company Act

Allen Matkins on

Section 17701.7 of the California Corporations Code sets up two arguably contradictory rules.  Subdivision (b) provides that unless displaced by "particular provisions" of the California Revised Uniform Limited Liability...more

Allen Matkins

When A 20% Interest May Be a 40% Interest

Allen Matkins on

The possible application of California's Corporate Securities Law of 1968 may not be the first thing that comes to mind when amending charter documents.  However, Section 25120 of the California Corporations Code makes it...more

Allen Matkins

The Too Too Unpardonable Fault Of Conflating LLCs And Corporations

Allen Matkins on

Law Professors Samantha Prince and Joshua Fershee have recently completed an article on the importance of not conflating limited liability companies with corporations.  In An LLC By Any Other Name Is Still Not A...more

Allen Matkins

Court Finds Plaintiff Failed To Plead Impropriety Of LLC Distributions

Allen Matkins on

The California Revised Uniform Limited Liability Company Act defines a "distribution" as a transfer of money or other property from a "limited liability company" (Cal. Corp. Code § 17701.02(k)) to another "person" (Cal. Corp....more

Allen Matkins

Does The California Legislature Really Believe In the Existence Of Limited Liability Corporations?

Allen Matkins on

The California Corporations Code includes provides for the formation of corporations as well as limited liability companies.  However, it does not provide for the formation of limited liability corporations.  Oddly, however,...more

Allen Matkins

A Key Difference Between Corporate And LLC Buyout Rights That You May Have Missed

Allen Matkins on

Both the California General Corporation Law and the California Revised Uniform Limited Liability Company Act include provisions granting shareholders/members the right to avoid a dissolution of the corporation/LLC under...more

Allen Matkins

This California LLC Statute Entirely Bungles The Internal Affairs Doctrine

Allen Matkins on

At first glance, California Corporations Code Section 17708.01(a) appears to be a rather straightforward enunciation of the "internal affairs doctrine" as applied to foreign limited liability companies...more

Allen Matkins

Court Insists No Standing In LLC Derivative Actions Without Continuous Ownership

Allen Matkins on

Derivative actions by members of domestic or foreign limited liability companies are governed by Section 17709.02 of the California Corporations Code.  That statutes provides that “no action shall be instituted or maintained...more

Allen Matkins

Why I Find This Case To Be So Confusing

Allen Matkins on

I recently came across Judge William Alsup's ruling in Carbon Crest, LLC v. Tencue Productions, LLC, 2022 U.S. Dist. LEXIS 66676.  However, the first two sentences of the ruling left me baffled...more

Allen Matkins

The Curious Case Of The Unregistered Foreign LLC

Allen Matkins on

I recently came across and was baffled by the following decision...more

Allen Matkins

Inspection When The Subsidiary Is A Limited Liability Company

Allen Matkins on

Section 1601 of the California Corporations Code grants any shareholder the right to inspect the accounting books, records, and minutes of board and shareholder meetings for a purpose reasonably related to the shareholder's...more

Allen Matkins

Court Rules An LLC To Be An Unincorporated Association, But Is That Correct?

Allen Matkins on

Cal. Serv. Emples. Health & Welfare Trust Fund v. Greenbox Servs. LLC, 2021 U.S. Dist. LEXIS 93477 involved a plaintiff's attempt to serve a limited liability company.   After thrice failing to serve personally the LLC's...more

Williams Mullen

Corporate and Business Law

Williams Mullen on

This year there were a number of significant legislative changes to the Virginia Stock Corporation Act (“VSCA”) and the Virginia Limited Liability Company Act. Part I discusses certain statutory changes related to Virginia...more

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