In the last year or so, I have seen several business owners who are not very happy that New Jersey LLC members now have the same protection from minority oppression that is enjoyed by minority shareholders of corporations. To “protect” against such lawsuits, apparently several attorneys around the state are advising clients to add to Operating Agreements a clause that waives this protection.» Read More
Many times a law is enacted, but a judge or appellate court makes a decision that casts the interpretation of that law into chaos. (Of course, none of the judges I regularly appear before would ever do this.) Almost one year ago, the New Jersey LLC Act was amended to give LLC members the minority owner oppression remedies historically applied to shareholders of a corporation.» Read More
In my last post, I wrote about the fact that your right to simply withdraw from a New Jersey LLC and be paid fair market value for your shares – provided the Operating Agreement does not prohibit this – is being eliminated on March 1, 2014. Many readers of that post have contacted me, hoping there was a way to extend that deadline. » Read More
If you are a member of a New Jersey Limited Liability Company (LLC), and you are not happy with the way the company is being run, you can simply withdraw and be paid fair market value for your shares – provided the LLC’s Operating Agreement does not prohibit this. However, this right expires on March 1, 2014, because of an amendment to the law.» Read More
I have written many times over the years about the differences between a corporation and an LLC when it comes to minority owner rights in New Jersey. On many occasions, I have written about the fact that shareholder rights are much more expansive in a corporation, and much more restrictive in an LLC. That all changes of March 1, 2014.
On that date, the existing LLC statute is being repealed, and the oppressed minority shareholder statute is effectively being incorporated into the LLC statute.» Read More