In the recent decision of Reid v. Siniscalchi, C.A. No. 2874-VCS (Del. Ch. Jan. 30, 2018), the Court of Chancery analyzed the “conspiracy theory” of personal jurisdiction.

According to the Court:

Under the conspiracy theory of personal jurisdiction, the parties to a conspiracy are treated as each other’s agents with respect to acts in furtherance of the conspiracy. Thus, a substantial Delaware act by a conspirator in furtherance of the conspiracy may be attributed to nonresident co-conspirators if the co-conspirators knew or had reason to know of that act and the act “in [Delaware] was a direct and foreseeable result of the conduct in furtherance of the conspiracy.” In turn, if a conspirator’s conduct in furtherance of the conspiracy subjects him to the jurisdiction of Delaware’s courts, then the attribution of that conduct to nonresident co-conspirators will subject all of the conspirators to the jurisdiction of the Delaware courts.

Slip op., at 37 (internal citations omitted).

The case had spanned for over a decade to allow plaintiff to take jurisdictional discovery to support such theory of jurisdiction.  On a motion for summary judgment, the Court determined that the plaintiff “misled the Court by crying ‘victim’ of a Delaware based conspiracy, when, in fact, he was an architect of the very wrongdoing that he claimed provided a basis for the Court to exercise long-arm jurisdiction over [defendant].”  Slip op., at 42.  As such, Vice Chancellor Slights declined to exercise jurisdiction over such non-resident defendant, and granted summary judgment in its favor based on lack of personal jurisdiction.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

In the recent decision of Sarissa Capital Domestic Fund LP v. Innoviva, Inc., C.A. No. 2017-0309-JRS (Del. Ch. Dec. 8, 2017), a disputed oral settlement agreement was specifically enforced by the Delaware Court of Chancery in a proxy contest between Innoviva, Inc. and Sarissa Capital Management resulting in two dissident directors being seated on the board of directors of Innoviva. Vice Chancellor Slights held that the principals of Innoviva and Sarissa had entered into a valid, binding oral agreement that required Sarissa to cease its proxy solicitation in exchange for two seats on the Innoviva board. Given what the Court found to be “opportunistic maneuvers” by Innoviva in reneging on the agreement after it became clear that it would unexpectedly win the proxy contest, the Court awarded Sarissa specific performance of the settlement agreement.

Earlier in 2017, Sarissa launched a proxy contest to replace three of Innoviva’s seven directors at the company’s April 2017 annual meeting. Sarissa and Innoviva reached an oral agreement that in exchange for Sarissa ending its proxy campaign and related litigation, Innoviva would expand its board from seven to nine members and appoint two Sarissa nominees to the board.  The Court found that representatives of each party orally confirmed that they “had a deal” and that it would be left to other team members to “prepare the ‘paperwork . . . to get it done.’”  Notably, the deal was not contingent on execution of the paperwork, or subject to further board approval.

After Innoviva attempted to back out of the deal, upon learning that it would have sufficient votes to maintain its current representatives on the board, Sarissa commenced this action.  The lawsuit was commenced as an action under Section 225 of the Delaware General Corporation Law (“DGCL”), a statute that allows the Court of Chancery to hear and determine the validity of any election, of any director or officer of any corporation, and the right of any person to hold or continue to hold such office.  [For a prior post discussing Section 225 in detail, click here.]

In granting specific performance, Vice Chancellor Slights found that each element of an award of specific performance was satisfied with clear and convincing evidence.  The elements included: (1) a valid, enforceable settlement agreement existed, (2) the “essential elements” of that agreement were satisfied; and (3) the absence of an adequate legal remedy, because monetary damages could not compensate Sarissa for the loss of its ability to appoint representatives to the board of Innoviva.

Key Takeaway:

This decision is notable in that a oral agreements are difficult to prove, especially ones that change the composition of a board of a Delaware corporation.  Prior to executing a formal agreement, parties should take care to document the terms of a deal through writing, and make clear that a deal is contingent upon the execution of a final settlement agreement.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

The recent opinion of Protech Solutions, Inc. v. The Delaware Department of Health and Human ServicesC.A. No. 2017-0642-TMR (Del. Ch. Nov. 30, 2017) sets forth a helpful roadmap in terms of the Court’s determination of whether to uphold a state contract for professional services.

There, Plaintiff Protech Solutions, Inc. (“Protech”) challenged the decision of the State of Delaware Department of Health and Social Services, Division of Child Support Services to grant a contract to another bidder in response to a Request for Proposal (“RFP”) for maintenance and operations (“M&O”) services for the Delaware Child Support System.  Protech sought injunctive relief by way of a preliminary injunction motion.

Vice Chancellor Montgomery-Reeves denied the motion, finding that Protech “fail[ed] to demonstrate reasonable probability of success on the merits of any of [its] claims”, and Protech’s arguments were based upon a misunderstanding of Delaware procurement law.

In so holding, the Court relied on sections of the Delaware Procurement Code governing professional services contracts, rather than case law involving challenges to public works contracts under the Delaware Procurement Act, as requested by Protech.  The Court noted that  “the professional services negotiation subchapter establishes only general guidelines for the procurement process”, and that “agencies are granted great discretion to shape the process to meet their needs.”

As a result, given the more general guidelines established under the Act pertaining to professional services contracts, the Court found that Protech failed to meet the elements of a preliminary injunction motion.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

The recent decision of LVI Group Investments LLC v. NCM Group Holdings LLC, C.A. No. 12067-VCG (Del. Ch. Sept. 7, 2017) addresses the concept of conspiracy theory of jurisdiction, under which which a non-resident may be subject to Delaware court jurisdiction if a co-conspirator commits an act in Delaware in furtherance of the conspiracy.

Specifically, according to the Delaware Supreme Court,

a conspirator who is absent from the forum state is subject to the jurisdiction of the court, assuming he is properly served under state law, if the plaintiff can make a factual showing that: (1) a conspiracy to defraud existed; (2) the defendant was a member of that conspiracy; (3) a substantial act or substantial effect in furtherance of the conspiracy occurred in the forum state; (4) the defendant knew or had reason to know of the act in the forum state or that acts outside the forum state would have an effect in the forum state; and (5) the act in, or effect on, the forum state was a direct and foreseeable result of the conduct in furtherance of the conspiracy.

Istituto Bancario Italiano SpA v. Hunter Eng’g Co., 449 A.2d 210, 225 (Del. 1982).

In LVI Group, Vice Chancellor Glasscock examined whether a non-resident CFO of a Delaware corporation was subject to jurisdiction in Delaware under the conspiracy theory of jurisdiction.  The Court found that plaintiff’s attempt to establish personal jurisdiction via a conspiracy theory fails because “[a] corporation cannot conspire with itself.”  Slip op. at 6.  Plaintiff alleges a conspiracy between defendant corporation, its executives and board members.  As this Court has explained, however, “a corporation generally cannot be deemed to have conspired with its officers and agents for purposes of establishing jurisdiction under the conspiracy theory.”  Id.

Plaintiff argued an exception to this rule in the Third Circuit decision of Johnston v. Baker, 445 F.2d 424 (3d Cir. 1971), because it pled that defendant CFO acted for “his own personal benefit because he was an LVI owner and was to become CFO of the new company with substantial compensation,” that is, defendant would become CFO of a new company with a “substantial” salary.

However, Vice Chancellor Glasscock noted that “[c]ourts interpreting the personal reasons exception of Johnston . . . have read it to mean a personal animus and/or desire for financial benefit other than one’s corporate salary.”  Slip op. at 6. Moreover, “[n]owhere in . . . Johnston is there any suggestion that the desire to protect or enhance one’s salary makes an agent sufficiently independent of the corporation to be capable of conspiring with it.”  Id. at 6-7.

Accordingly, the Court found that personal jurisdiction over the non-resident CFO cannot be premised on plaintiff’s conspiracy theory.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

In the latest development in the ongoing TransPerfect dispute, the Court of Chancery denied Ms. Shawe’s application for interlocutory appeal, in the opinion of Shawe v. TransPerfect Global, Inc., C.A. No. 2017-0306-AGB (Del. Ch. Sept. 7, 2017).

By way of background, on August 13, 2015, the Court granted Elizabeth Elting’s petition to appoint a custodian (“the Custodian”) to sell TransPerfect Global, Inc. (“TPG” or the “Company”) under 8 Del. C. § 226 in order to remedy the dysfunction in the co-founders’ management of the Company and the deadlocks at the board and stockholder level.

In June 2016, Court accepted, with certain modifications, the Custodian’s recommendation for a proposed plan of sale for the Company, and issued an implementing order in July 2016 (the “Sale Order”). On February 13, 2017, the Supreme Court affirmed the post-trial decision and the Sale Order.

Ms. Shawe filed the latest action on April 20, 2017, asserting a claim under Section 211(c) of the DGCL to compel TPG to hold an annual meeting of stockholders.  Elting then filed a motion to enforce the Sale Order and for sanctions, asserting that the Section 211 action violated the Sale Order. The Court ordered the parties to engage in mediation before former Chancellor Chandler.

After mediation reached an impasse, on August 4, 2017, the Court issued a letter decision granting Elting’s motion to enforce the Sale Order, denying Elting’s motion for sanctions, and denying Ms. Shawe’s motion to expedite.  The Court found that Shawe’s Section 211 action was to remove the Custodian and end the sale process, which was inconsistent with the Sale Order, and that ordering a stockholders’ meeting “would be a futile exercise”.

Ms. Shawe applied for an interlocutory appeal of the August 4th ruling, which was opposed by Elting and the Company.

Chancellor Bouchard denied the application for interlocutory appeal.  The application is governed by Supreme Court Rule 42(b)(i), which provides that an interlocutory appeal will not be certified “unless the order of the trial court decides a substantial issue of material importance that merits appellate review before a final judgment.”  Del. S. Ct. Rule 42(b)(i).

The Court found that the August 4th ruling did not decide a substantial issue of material importance, but rather was the logical consequence of enforcing the Sale Order.  The Court also found that scheduling a stockholders’ meeting may jeopardize the sale process, and that no considerations of justice would be served by granting interlocutory review.  Stay tuned for further updates in the TransPerfect dispute.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

In the recent decision of Carl Zeiss Vision, Inc. v. REFAC Holdings, Inc., C.A. No. 11513-VCS (Del. Ch. Aug. 24, 2017), Vice Chancellor Slights denied a motion to vacate an arbitration award.  Noting that the “standard of judicial review with respect to such applications is among ‘the narrowest . . . in all of American jurisprudence'”, the Court found unconvincing defendants’ argument that the arbitration panel “eviscerate[d] the essential term” of the agreement sua sponte and then “permit[ted] the agreement to remain in effect after gutting that term.”  The Court was not inclined to permit a “do over” of the arbitration.

In declining defendants’ motion to vacate the award, the Court noted that the Federal Arbitration Act (“FAA”) “require(s) reviewing courts to give practically the highest degree of deference, short of ‘untouchable,’ recognized in the law to an arbitrator’s award. Indeed, to overturn an award, the court must be satisfied that ‘there [is] absolutely no support at all in the record justifying the arbitrator’s determinations.'”

Key Takeaway

This decision reinforces the notion that overturning an arbitration award is a “near[] vertical climb”.  Although arbitration has the benefits of confidentiality and potentially limited discovery and speed, the downfall for the losing party is the difficulty in overturning an award.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

The Delaware Supreme Court has just reached a decision that highlights the importance of taking the time to review your estate planning documents each and every year to ensure that the documents still fit, and not inadvertently allowing your testamentary plans to be changed. The decision affirmed an August 2016 Court of Chancery opinion.

Last will and testament
Copyright: stuartburf / 123RF Stock Photo

Edward J. Burke named Mildred, his wife of then 13 years, as his Power of Attorney on March 17, 1998 and on that same date, executed his Will.  Under his Will, Edward left the Virginia property that he then owned to the Trustee of the Trust established under his Will.  Edward directed the Trustee to allow his daughter to live on the Virginia property for three years and then directed the Trustee to sell the Virginia property.  The income from that sale was to go to Mildred for life and after Mildred’s death the remaining sum was to be distributed to his four children.  Edward left the residue of his estate to Mildred.

In 2012, Edward sold the Virginia property for $150,000 and deposited the net proceeds into a separate and new bank account that was in his name alone.  According to his son, Kevin, Edward had repeatedly told his children that these funds were being held for them in accordance with the 1998 Will and testimony was offered to prove that Edward had repeatedly denied Mildred’s request to gain access to this account because he wanted the funds to go to his children.  Edward became sick and had quadruple heart bypass surgery in January 2013.  Around this time, Mildred added her name as a joint owner to the account using the Durable Power of Attorney, according to Kevin without her husband’s knowledge or consent.

Edward died on October 10, 2013, leaving to survive him, Mildred (after having been married for 28 years), and his four children from his first marriage including Kevin.

Since nothing was in Edward’s name alone upon Edward’s death, Mildred did not probate Edward’s estate and due to her retitling of Edward’s account (which held the proceeds from the sale of the Virginia property) the Virginia sale proceeds passed by operation of law to Mildred.

Kevin sued his step-mother alleging that Edward had purposefully segregated the proceeds from the sale of the Virginia property with the intent to preserve the funds for his children.  Mildred alleged (and Master Ayvazian agreed) that Edward had changed his testamentary plan when he sold the Virginia property under the doctrine of ademption.  Further, the Court held, that even if Edward had not known about or approved of Mildred’s adding herself to the account, and even if the Court held that Mildred had to return the money from the account to the estate, the money would have flowed under the Will into the residuary clause, thereby ending up in Mildred’s hands anyway as she was the sole remainder beneficiary.

Master Kim E. Ayvazian relied upon In the Matter of Estate of Hobson, 456 A.2d 800 (1982):

The Court in Hobson held that:

“[U]nder Delaware law, when a testator has sold real estate during her lifetime, such disposition works an ademption of the specific devise in her Will.  Consequently, the rights of devisees do not attach by way of substitution to the proceeds of its sale or to other property subsequently acquired by the testator. Moreover, in Delaware the rule of ademption is not dependent on the apparent intention of the testator.  In fact, the application of the rule may, in many instances, defeat the intention of the testator. ” (Emphasis added.)

What did Edward actually intend?  Tough to say since Edward cannot testify.  But clearly, if Edward’s intent is not important, then it really doesn’t matter.  Even if Kevin could have proven that his father intended to or meant to leave this money to his children, this would not have been enough for the children to inherit the sales proceeds because:

  1. The Durable Personal Power of Attorney was sufficiently broad to enable Mildred to retitle the funds jointly thereby defeating Edward’s supposed intent.
  2. Edward had not changed his Will after the sale of the Virginia property and since Mildred was the residuary beneficiary, then the money from the sale would have flowed through to the residue to Mildred, not to the children.

Assuming that Edward wanted this money to go to his children, what could Edward have done to ensure that the proceeds from the sale of his Virginia property actually went to his children?

Edward had a smaller account with a daughter as joint owner but Mildred removed the daughter’s name from this account before Edward’s death so this account, too, went to Mildred.

How could Edward have ensured that the money went to his children?

Edward should have reviewed his Will after the sale of the Virginia property, and prepared a Codicil to leave the proceeds from the sale of the Virginia property to his children.

Edward should have also revised his Durable Power of Attorney to thwart Mildred’s right to add her name to this account.  As shown by this case, Durable Powers of Attorney are powerful documents – under which it is possible to completely change someone’s testamentary scheme.

Key Takeaway:

Take the time to review your estate planning documents each and every year to ensure that the documents still fit your family and do not inadvertently let your testamentary plans get changed by anyone other than you.

In the letter opinion of Windsor I, LLC v. CWCapital Asset Management LLC, C.A. No. 12977-CB (Del. Ch. July 31, 2017), the Court of Chancery determined the enforceability of an agreement to negotiate, under Maryland law.  Plaintiff is the owner of a commercial property in Wilmington, Delaware, and Defendant is a special servicer that handles the default side of loan servicing for its affiliate.

Plaintiff requested that its loan be transferred to special servicing in anticipation of its large commercial tenant terminating the lease on the property.  Thereafter, the parties negotiated a Pre-Negotiation Agreement, after which time the parties engaged in settlement negotiations to purchase the loan on the property at issue.

Plaintiff filed a complaint seeking specific performance and injunctive relief, to compel Defendant to comply with the terms of the Pre-Negotiation Agreement contained in the parties’ Mortgage and Security Agreement to refinance existing debt on the property at issue.  Plaintiff asserted that the terms of the Pre-Negotiation Agreement were not upheld by Defendant.

The Court granted Defendant’s motion to dismiss, finding that there was no binding obligation in the Pre-Negotiation Agreement to negotiate.  Further, the Court rejected Plaintiff’s assertion that Defendant violated the implied covenant of good faith and fair dealing.  This is so because even if there was an obligation to negotiate, “such an obligation would be so inherently vague as to be unenforceable.”  Citing Maryland authority, the “overwhelming weight of authority holds that courts will not enforce an agreement to negotiate a contract.”

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

In a matter of first impression, the Court of Chancery considered whether an “unauthorized” act–one that the majority of stockholders entitled to vote deliberately declined to authorize–but that the corporation nevertheless determined to pursue, may be deemed a “defective corporate act” under Section 204 that is subject to later validation by ratification of the stockholders via Section 205 of the DGCL. Vice Chancellor Slights addressed this issue in the opinion of Nguyen v. View, Inc., C.A. No. 11138-VCS (Del. Ch. June 6, 2017).

In considering this question, the Court provided a helpful roadmap of opinions analyzing Sections 204 and 205 since the enactment of those statutes in 2014.  [For an earlier post discussing Sections 204 and 205, click here.]  Vice Chancellor Slights denied relief because the “unratified” corporate acts were unauthorized and rejected by the majority stockholder, as opposed to simply being defective.

The Court noted the difference between “failure of authorization” and “rejection” by stockholders. Neither the text of the statutes nor their legislative history lent support to usage of the statutes to ratify a corporate act that had been denied by the majority of a corporation’s stockholders.

Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in the State of Delaware and regularly practices before the Delaware Court of Chancery, with an emphasis on shareholder disputes. You can reach Carl at (302) 622-4272 or at

Clients can pick their own attorneys but they cannot pick their own facts. A recent case decided by Master Ayvazian highlights the difficulties that unfortunate facts can present.

Creditors have eight months to file a claim against an estate (see 12 Del.C. §2102(a)). After a claim is presented, the executor (or personal administrator) can pay the claim or can deny the claim. Other than failure to timely file the claim (see 12 Del.C. §2102(a)), there is no statutory justification for denial of claim. In fact, Delaware has historically held that fiduciaries owe a fiduciary duty to creditors. See In re Estate of Bennie P. Farren, Del. Ch., C.A. No. 9385-MA (June 18, 2015).

Last will and testament
Copyright: stuartburf / 123RF Stock Photo

Delaware Acceptance Corporation, CACV of Colorado, LLC and 202 Investments, Inc. v. Estate of Frank C. Metzner, Sr., Lona C. Metzner, Executrix and Frank C. Metzner, Jr., the Metzner Family, LLC, C.A. No. 8861-MA involved an executor who denied a claim in the amount of $41,002.59 which had been filed against the estate by a credit card company. After four years of litigation, the Court of Chancery, Master Kim Ayvazian, found that the case hinged on the authenticity of a document, which in turn depended upon the credibility of several witnesses. The Court found that the backdating of documents and the offering of false testimony at trial rendered the Executrix unfit to serve as fiduciary and ordered her removal.

Frank C. Metzner, Sr. (“Frank , Sr.”) and his wife, Lona C. Metzner (“Lona”), deeded their house in Lewes into the Metzner Family Limited Liability Company (the “LLC”) in 2002. Frank, Sr. and Lona each held originally a fifty percent interest in the LLC but subsequently they gave two percent to their son, Frank, Jr.

In 2003, Frank, Sr. and Lona stopped paying their bills, including their credit cards, when the outstanding balance totaled approximately $55,000. Plaintiffs Delaware Acceptance Corporation CACV of Colorado, LLC and 202 Investments, Inc. (“Creditor”) sought a Charging Order based upon the Court of Common Pleas judgments that had been entered against Frank, Sr. and Lona. The Charging Order was signed on December 6, 2010 and served upon the LLC to attach to any distributions from the LLC to either Frank, Sr. or Lona. Frank, Sr. and Lona’s personal residence which was the asset of the LLC clearly did not have any income spitting out so the Charging Order laid dormant.

Subsequently Frank, Sr. died on October 26, 2012 and his Will, which was filed on December 5, 2012, named Nona as executor. The sole asset in the Estate was Frank, Sr.’s 49% interest in the LLC which was left to his son, Frank, Jr. Creditor filed its claim against the Estate on April 15, 2013. The Estate’s attorney denied the claim by letter dated June 3, 2013 on the basis that: (1) the Estate was devoid of assets other than the 49% LLC interest; (2) it was understood that the Charging Order was not dissolved by Frank, Sr.’s death; (3) Frank, Sr.’s 49% interest transferred under the Will to Frank, Jr. remained subject to the Charging Order. This was unacceptable to the Creditor.

Under the LLC Agreement (as was common in those days), the death of a member was considered a withdrawal, resulting in the dissolution of the LLC unless the surviving members elected to continue the LLC within 90 days of the death of the member. If the LLC were dissolved, 49% of the personal residence would have been distributed out to the Estate of Frank, Sr. thereby, the Executrix (faced with the Charging Order) as a fiduciary for the creditor, could have been directed to sell the house to satisfy the claim.

Within the required three month window (under 12 Del.C. 2102(b)) the Creditor filed a complaint alleging its belief that the LLC had dissolved after the death of Frank, Sr. due to the failure of the remaining members, Lona and Frank, Jr., to have consented in writing to continue the LLC within the 90 days after Frank, Sr.’s death.

In response, the Executor alleged that the remaining members (Lona and Frank, Jr.) had effectively elected to continue the LLC after Frank, Sr.’s death and proffered first a signed writing dated November 30, 2012 (the “Election”).

The Court found the Election suspect and in an effort to discern the actual date of the Election, directed the Creditor’s attorney to request the metadata relevant to the Election from the computer of the attorney who had drafted the document and/or such attorney’s former firm’s network server and to produce the data to the Court within 60 days. If the metadata was not produced, the Court would draw an adverse inference that the Election had been created after the 90-day period following Frank, Sr’s death. No metadata was ever delivered to the Court.

The attorney testified that he believed that the Election had been prepared in his office although the Election did not have certain identifiable marks (e.g. file number) that would evidence such preparation, nor was the Election-signing ceremony on the attorney’s calendar.

Undeterred, at trial Lona introduced a second document that had not previously been produced during the litigation (the “November 10th letter”). The November 10th letter (admittedly written by Lona) would have served as a sufficient writing to continue the LLC had the Court believed its provenance or if the metadata associated with the November 10th letter been provided. According to Lona’s testimony at trial, however, the computer that had generated the November 10th letter had “gone bad” a few years ago and had been disposed of.

Unfortunately for her, Lona was not a credible witness.

In concluding that Lona should be removed as Executor for cause, the Court held that a person who backdates documents and offers false testimony at trial should not be a fiduciary of an estate. The Court ordered the appointment of a new personal administrator with an order to: (1) dissolve the LLC; (2) liquidate the assets in the LLC; and (3) make disbursements to pay off the Creditor as required in the Changing Order.

Key takeaways:

First, review LLC Agreements to discern whether mandatory election is necessary and advisable and amend the LLC Agreement if appropriate. Second, only go into trial with a firm belief in the honesty of your client’s version of the facts. Otherwise, don’t let your client pick you as their attorney.

Beth B. Miller is counsel with the law firm of Fox Rothschild LLP, resident in its Wilmington office. She practices business, tax and trusts and estates law. You can reach Beth at (302) 622-4219 or at