Where Corporation’s Operating Agreement Required Shareholder Consent to Take Legal Action, Shareholder Could Block it From Answering Lawsuit by that Shareholder Against the Corporation
Commercial Case Notes / Corporations

Where Corporation’s Operating Agreement Required Shareholder Consent to Take Legal Action, Shareholder Could Block it From Answering Lawsuit by that Shareholder Against the Corporation

On November 6, 2024, Justice Ruchelsman of the Kings County Commercial Division issued a decision in 2351 Bedford Holding, LLC v. Flatbush Funding LLC, 2024 NY Slip Op. 33984(U), holding that where an operating agreement required majority consent of the shareholders to take legal action, a shareholder could block the corporation for answering a lawsuit brought by that shareholder against the corporation . . . Continue reading Where Corporation’s Operating Agreement Required Shareholder Consent to Take Legal Action, Shareholder Could Block it From Answering Lawsuit by that Shareholder Against the Corporation

Substantive Law of Company’s Place of Incorporation Presumptively Applies to Claims Arising from its Internal Affairs
Commercial Case Notes / Corporations / Fiduciaries

Substantive Law of Company’s Place of Incorporation Presumptively Applies to Claims Arising from its Internal Affairs

On May 23, 2024, the Court of Appeals issued a decision in Eccles v. Shamrock Capital Advisors, LLC, 2024 NY Slip Op. 02841, holding that the substantive law of a company’s place of incorporation presumptively applies to causes of action arising from its internal affairs . . . Continue reading Substantive Law of Company’s Place of Incorporation Presumptively Applies to Claims Arising from its Internal Affairs

Defendant That Has Dealt With an Entity as a Corporation Cannot Avoid Obligations to it Because it Was Not Properly Incorporated
Commercial Case Notes / Corporations / Standing

Defendant That Has Dealt With an Entity as a Corporation Cannot Avoid Obligations to it Because it Was Not Properly Incorporated

On April 3, 2024, the Second Department issued a decision in Teva Realty, LLC v. Cornaga Holding Corp., 2024 NY Slip Op. 01833, holding that a defendant that dealt with an entity as a corporation cannot avoid its obligations to is because it was not properly incorporated . . . Continue reading Defendant That Has Dealt With an Entity as a Corporation Cannot Avoid Obligations to it Because it Was Not Properly Incorporated

New York Court Has Jurisdiction to Decide Ownership Dispute Under Delaware General Corporation Law 205
Commercial Case Notes / Corporations / Subject Matter Jurisdiction

New York Court Has Jurisdiction to Decide Ownership Dispute Under Delaware General Corporation Law 205

On September 5, 2023, Justice Cohen of the New York County Commercial Division issued a decision in Owen v. Array US, Inc., 2023 NY Slip Op, 33056(U), holding that a New York court has jurisdiction to decide a stock ownership dispute under Delaware General Corporation Law Section 205 . . . Continue reading New York Court Has Jurisdiction to Decide Ownership Dispute Under Delaware General Corporation Law 205

Common Law Demand to Inspect Books and Records Cannot Be Used to Obtain Discovery for Use in Litigation
Commercial Case Notes / Corporations / Discovery/Disclosure

Common Law Demand to Inspect Books and Records Cannot Be Used to Obtain Discovery for Use in Litigation

On July 11, 2023, Justice Masley of the New York County Commercial Division issued a decision in Burden v. General Elec. Co., 2023 NY Slip Op. 32365(U), holding that a demand for inspection of books and records made under the common law cannot be used to obtain discovery for use in litigation . . . Continue reading Common Law Demand to Inspect Books and Records Cannot Be Used to Obtain Discovery for Use in Litigation

Common Law Books and Records Claim Survives Despite Failure Properly to Bring Statutory Claim
Commercial Case Notes / Corporations

Common Law Books and Records Claim Survives Despite Failure Properly to Bring Statutory Claim

On April 12, 2023, Justice Chan of the New York County Commercial Division issued a decision in Hafeez v. American Express Co., 2023 NY Slip Op. 31273(U), upholding a common law claim to inspect a corporation’s books and records despite the plaintiff’s failure properly to bring a statutory action to inspect books and records . . . Continue reading Common Law Books and Records Claim Survives Despite Failure Properly to Bring Statutory Claim