Limited Liability Company (LLC), Breach of Contract, Business Divorce

A Message of Acceptance from the Garden State

Farrell Fritz, P.C. on 5/27/2025

This week’s New York Business Divorce takes us to the Garden State for a delightfully-written, post-trial decision by retired, recalled Appellate Division Judge Clarkson S. Fisher, Jr....more

Business Appraiser Liability? That’s a New One.

Farrell Fritz, P.C. on 4/28/2025

We’ve written about accountant liability. We’ve written about bookkeeper liability. A carefully crafted complaint can state viable claims for either. But business appraiser liability?...more

LLCs Can Assert Offensive Claims Against Members

Patton Sullivan Brodehl LLP on 4/22/2025

In “business divorce” litigation involving LLCs, it is common to see a disgruntled LLC member asserting claims against the LLC’s manager. Depending on the type of harm alleged, those claims might be asserted directly (by the...more

LLC Member States Direct Claims Arising from Machiavellian Manager’s Tactical Bankruptcy Petition

Farrell Fritz, P.C. on 3/31/2025

“There is only going to be one winner here, and it’s not going to be you—give in while there is something still left in it for you,” said one LLC member to the other. With co-owners like that, who needs enemies?...more

New York Appellate Court’s Split Decision Involving Delaware LLC Pits “Harsh” Contractarianism Against “Fundamental Fairness”

Farrell Fritz, P.C. on 3/18/2024

Last week, the Manhattan-based Appellate Division, First Department, handed down one of the more intriguing decisions by a New York court I’ve seen in a long time involving a dispute between LLC members....more

Recent Decisions Enforce LLC Member’s Right of First Refusal, Restrict Partnership Accounting, and Allow Damages Claim for Breach...

Farrell Fritz, P.C. on 5/30/2023

Someday, perhaps, I’ll find the comedic inspiration to come up with a joke that begins, “An LLC, a partnership, and a close corporation walk into a bar . . ..” Until then, I’ll have to satisfy myself with writing about an...more

The Operating Agreement Controls, Unless Public Policy Says Otherwise

Farrell Fritz, P.C. on 2/28/2022

Two principles often guide courts’ interpretation and enforcement of contracts. First, courts respect parties’ freedom of contract, mostly. So long as an agreement is not illegal or violative of a strong public policy,...more

Valuation Decision Finds LLC “Worthless, Worthless, Worthless”

Farrell Fritz, P.C. on 2/14/2022

Justice Masley’s valuation decision in Quattro Parent LLC v Rakib, 2022 NY Slip Op 30190(U) [Sup Ct, NY County Jan. 14, 2022] is noteworthy for two reasons. First, it is an extraordinarily rare example of a business...more

Court Enjoins Dilution of Brewing Company LLC Membership Interest

Farrell Fritz, P.C. on 9/13/2021

Most folks associate beer with pleasure. Many craft brewers will tell you they went into business for that reason: to make themselves and others happy (and, oh yeah, make money). ...more

Delaware Court of Chancery: Deadlock Can be Genuine Even When Unilaterally Orchestrated

Snell & Wilmer on 5/5/2021

A Delaware Court of Chancery case decided earlier this year provides some useful guidance on the interpretation of LLC agreements and what constitutes a “deadlock” under Delaware law. The case, Mehra v. Teller, involved a...more

The Curious Case of the Expelled LLC Member Bound by Operating Agreement He Never Signed

Farrell Fritz, P.C. on 2/4/2020

The case of Shapiro v Ettenson ranks as one of the more consequential ones in the realm of New York’s LLC jurisprudence....more

A Case of LLC Withdrawal Symptoms

Farrell Fritz, P.C. on 1/27/2020

I was especially drawn to the case I’m about to introduce involving LLC member withdrawal, owing to the Jacobs v Cartalemi case that I litigated to a successful conclusion about two years ago, also involving member...more

The Perils of Indeterminate LLC Membership Interests

Farrell Fritz, P.C. on 10/14/2019

Here we go again — and again and again. On numerous prior occasions I’ve written about judicial dissolution cases and other infighting among LLC members featuring disputes over membership percentages. ...more

Will Someone Please Re-Name the Implied Covenant of Good Faith and Fair Dealing?

Farrell Fritz, P.C. on 2/12/2018

In the annals of business divorce litigation and assorted other disputes between co-owners of closely held business entities, the cause of action for breach of the implied covenant of good faith and fair dealing likely wins...more

Special Proceeding Seeking a Judicial Decree to Dissolve an LLC

Patterson Belknap Webb & Tyler LLP on 1/17/2018

In Advanced 23, LLC v. Chambers House Partners, LLC, No. 650025/2016, 2017 BL 462831 (NY. Sup. Ct. Dec. 15, 2017), Justice Saliann Scarpulla of the Commercial Division ruled that Advanced 23, LLC (“Advanced”) and David...more

Limited Liability Company (LLC) › Breach of Contract › Business Divorce

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