NEW: Farrell Fritz discusses New York case law governing the enforceability of oral agreements concerning the rights of owners different types of business entities in Enforceability of Oral Operating, Shareholder, and Partnership Agreements.
Farrel Fritz discusses validity and effect of transfers of LLC membership interests under New York law, noting that transfer rights can be subject to restrictions that are strengthened, weakened, or eliminated by the terms of an LLC Agreement, but statutory default rules leave involuntarily withdrawn members with economic interest rather than membership interests in Turmoil Follows Involuntary Transfers of LLC Membership Interests.
Farrel Fritz discusses the New York Appellate Division’s decision in Julius Behrend v. New Windsor Group, LLC, et al., No. 17-01392, opinion (N.Y. App. Jan. 29, 2020), affirming a ruling that the purported transfer of an interest in an LLC without unanimous consent of the other LLC members, required under the LLC agreement, did not make the transferee an LLC member, and resulted only in transfer of entitlement to receive distributions and profit and loss allocation, in Always Check Provenance Before Taking an Assignment of LLC Interest.
Farrel Fritz discusses the New York Court of Appeals’ decision in Luciano Bonanni, et al. v. Horizons Investors Corp., et al., No. 2017-06803, opinion (N.Y. App. Jan. 29, 2020), affirming a Trail Court’s finding that an asset sale between an LLC and a PLLC was a de facto merger based on cessation of business by the predecessor and continuity of business operations, management, assets, and personnel by the successor, and that the successor retained the predecessor’s liabilities, in Bending the Rules of Standing: The De Facto Merger Doctrine.
Farrel Fritz discusses the New York Supreme Court’s decision in Culligan Soft Water Co., et al. v Clayton Dubilier & Rice, LLC, et al., No. 651863/12, opinion (N.Y. Sup. Mar. 19, 2020), which found, in a derivative action, that futility of a litigation demand for claims asserted in an amended complaint must be considered as to liquidators appointed after plaintiff filed its original complaint but before plaintiff filed its amended complaint, rather than corporate directors, in The Pre-Suit Demand Requirement for a Corporation in Liquidation or Receivership.
Farrell Fritz discusses the New York Superior Court’s decision in Amit Doshi v. Michael Besen, No. 651696/19, opinion (N.Y. Sup. Ct. Dec. 30, 2019), judicially dissolving a deadlocked company, finding that resignation of one of the company’s two 50% stockholders as a director did not resolve deadlock, in Resignation: Antidote for Internal Dissention and Deadlock?
Farrell Fritz’s Peter Mahler discusses case law interpreting purpose and audit provisions of a New York LLC Agreement in Court Takes Ambiguity Off the Menu of Restaurant’s LLC Agreement.
Farrell Fritz discusses the New York Supreme Court’s decision in Lois Weinstein v. RAS Property Management, LLC, et al., No. 653735/19, opinion (N.Y. Sup. Feb. 5, 2020), finding that a successor in interest to a deceased limited partner succeeds to the decedent’s economic rights but not partner status for purposes of derivative standing in Death of Limited Partner Disarms Derivative Action.
Farrell Fritz’s Peter Mahler discusses New York case law addressing the ability of a minority LLC member to force dissolution in LLC Member’s Petition to Dissolve Boxing Club Dealt First Round KO.
Farrell Fritz discusses the New York Supreme Court’s decision in Robert Shapiro v. Gabriel Ettenson, et al., No. 654641/17, memo. op. (N.Y. Sup. Ct. Dec. 23, 2019), finding that an LLC member’s claim for wrongful expulsion in breach of the LLC Agreement was direct rather than derivative, where defendants allegedly failed to follow the Agreement’s dissociation procedures, in The Curious Case of the Expelled LLC Member Bound by Operating Agreement He Never Signed.
Lowenstein Sandler discusses the New York Appellate Division’s ruling in Mark A. Galasso v. Cobleskill Stone Products, Inc., et al., No. 527237, memo. op. (N.Y. App. Div. Feb. 28, 2019), an appraisal action, holding that a valuation was not protected by attorney-client privilege because it was created for an estate tax filing before the appraisal action commenced, in Are Communications With Third Parties Still Attorney-Client Privileged in Appraisal?
Bryan Cave discusses the New York Appellate Division’s ruling in Kevin Askari, et al. v. McDermott, Will & Emery, LLP, et al., No. 606862/15, opinion (N.Y. App. Div. Nov. 27, 2019), finding that New York law governed privilege applicable to seller’s pre-transaction communications notwithstanding a contractual Delaware choice of law clause, and differences between New York and Delaware law addressing privilege applicable to pre-transaction communications in post-transaction disputes in Buyer’s Purchase or Seller’s Privilege? Attorney-Client Communications in the Post-Sale Context.
McGuireWoods discusses the New York Appellate Division’s ruling in Kevin Askari, et al. v. McDermott, Will & Emery, LLP, et al., No. 606862/15, opinion (N.Y. App. Div. Nov. 27, 2019), finding that New York law governed privilege applicable to seller’s pre-transaction communications despite a purchase agreement’s Delaware choice of law clause due to New Yok’s greater interest in the litigation in NY Appellate Division Affirms Seller Retains Privilege for Certain Pre-acquisition Communications.
Shearman & Sterling discusses the U.S. Court of Appeals for the Second Circuit’s decision in Chufen Chen, et al. v. Dunkin’ Brands, Inc., No. 18-3087, opinion (2d Cir. Mar. 31, 2020), finding that registration to do business in New York does no subject a company to general personal jurisdiction in The Second Circuit Holds that New York Business Registration Does Not Constitute Consent to General Personal Jurisdiction.
Sheppard Mullin discusses the U.S. Court of Appeals for the Second Circuit’s decision in Chufen Chen, et al. v. Dunkin’ Brands, Inc., No. 18-3087, opinion (2d Cir. Mar. 31, 2020), finding that registration to do business in New York does no subject a company to general personal jurisdiction in Second Circuit Holds that Registering to do Business in New York Under Section 1301 of the Business Corporation Law Does Not Constitute Consent to General Personal Jurisdiction in New York Courts.