By: Scott Waxman and Zack Sager
In DG BF, LLC v. Ray, the Delaware Court of Chancery denied the plaintiffs’ motion for declaratory judgment, which sought confirmation that a manager’s consent was necessary in order to issue a new series of units of a limited liability company and to amend a limited liability company agreement.
Read MoreBy: Scott Waxman and Zack Sager
In Llamas v. Titus, the Court of Chancery held that, despite the intent of an LLC’s sole member, certain managers of the LLC were not removed as such because the sole member did not expressly remove them. In its analysis, the Court applied corporate law principles by analogy because the LLC adopted a corporate-like structure.
Read MoreBy: Scott Waxman and Tami Mack
In Richard B. Gamberg 2007 Family Trust v. United Restaurant Group, L.P., C.A. No. 10994-VCMR (Del. Ch. January 26, 2018), the Court of Chancery held that limited partner, Richard B. Gamberg 2007 Family Trust (the “Plaintiff”), failed to meet its burden of proof with respect to various claims against United Restaurant Group L.P. (the “Partnership”), Atlantic Coast Dining, Inc. (the “General Partner”), and the directors/shareholders of the General Partner (the “Shareholder Defendants”; together with the Partnership and the General Partner, the “Defendants”), which included a mistake-based reformation claim, among other breach of contract and breach of fiduciary duty claims.
By: Lisa R. Stark and Taylor B. Bartholomew
In Frechter v. Zier, C.A. No. 12038-VCG (Del. Ch. Jan. 24, 2017), the Delaware Court of Chancery held that a corporation’s bylaw, which purported to require 66 2/3% of the voting power of all of the corporation’s outstanding stock to remove directors, was inconsistent with Section 141(k) of the General Corporation Law of the State of Delaware (the “DGCL”). Section 141(k) of the DGCL provides that, except with respect to corporations having a staggered board or cumulative voting, “[a]ny director or the entire board of directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors . . . .” Unlike some other provisions of the DGCL, Section 141(k) does not expressly provide for a default rule that applies “unless otherwise provided in the certificate of incorporation or bylaws.”
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