Connolly v. Napoli, Kaiser & Bern, LLP

__ N.Y.S.2d __, 2006 N.Y. Slip Op. 26132, 2006 WL 901675 (N.Y. Sup. 2006)

Potential liability of LLP partners for personal participation in alleged wrongdoing.

Ramone v. Lang

No. Civ.A. 1592-N, 2006 WL 905347 (Del. Ch. April 3, 2006)

For six months, the plaintiff and the defendant discussed and negotiated the formation of an LLC to purchase and operate an indoor swimming and fitness facility, but the parties never finalized their arrangement. Ultimately, the defendant purchased the property. The plaintiff argued that the defendant used the plaintiff’s good name and reputation to the defendant’s advantage and then cut the plaintiff out of the deal. The plaintiff alleged claims based upon breach of fiduciary duty, breach of contract, and promissory estoppel. The defendant claimed Continue reading →

Hecht, Solberg, Robinson, Goldberg & Bagley v. Superior Court

137 Cal.App.4th 579, 40 Cal.Rptr.3d 446, No. D047185 (Cal. App. 2006)

Discussion of privacy rights of LLP; discoverability of insurance policies, filings with Secretary of State, and financial records of non-party LLP in malpractice action against firm arising out of firm’s representation of plaintiff in previous malpractice action against LLP.
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Douzinas v. American Bureau of Shipping, Inc.,

888 A.2d 1146, C.A. No. 1496-N (Del. Ch. 2006)

The minority members of a Delaware LLC sued the majority member and its affiliates for diverting assets of the LLC to the majority member’s affiliates without compensation to the LLC. The defendants sought to compel the minority members to arbitrate their claims pursuant to a broad arbitration clause in the LLC agreement, and the court found the arbitration clause encompassed the minority members’ claims. Continue reading →

Securities and Exchange Commission v. Merchant Capital, LLC

400 F.Supp.2d 1336, No. 1:02-CV-2984-MHS (N.D. Ga. 2005)

In this securities fraud action brought by the SEC against the managing general partner (and its two individual principals) of 28 Colorado LLPs formed to purchase and collect debt pools of freshly charged off consumer debt, the court concluded the general partnership interests sold to the investors were not securities under the federal securities laws. The court described in detail the background and structure of the partnerships. Continue reading →

In re Paul J. Ferrigan Revocable Trust

2005 WL 2372082 , No. 254772 (Mich. App. Sept. 27, 2005)

The sole member of an LLC died, and the court held that the operating agreement, which was entered prior to amendment of the Michigan LLC statute to permit single member LLCs, was invalid. The court concluded that the amendment permitting single member LLCs and operating agreements did not have retroactive effect, and the provision of the statute stating that LLCs are bound by changes to the statute did not validate the agreement. Continue reading →