Derivative Actions Archives

Person Who Acquired Ownership LLC Interest did not Also Become Member or Have Standing to Bring Derivative Action

On November 26, 2025, the Second Department issued a decision in Kober v. Nestampower, 2025 NY Slip Op. 06609, holding that a person who acquired an ownership interest in a limited liability company did not also become a member or have standing to bring a derivative action . . . Continue reading Person Who Acquired Ownership LLC Interest did not Also Become Member or Have Standing to Bring Derivative Action

Commercial Case Notes / Derivative Actions

No Jury Trial in Derivative Action

On September 8, 2025, Justice Cohen of the New York County Commercial Division issued a decision in James Thomas Realty, LLC v Cheliotes, 2025 NY Slip Op. 33365(U), holding that there is no right to a jury trial in a derivative action . . . Continue reading No Jury Trial in Derivative Action

Commercial Case Notes / Derivative Actions / Standing

Shareholder Lacks Standing to Bring Direct Claim Based on Injury to Corporation

On October 22, 2024, Justice Bannon of the New York County Commercial Division issued a decision in Egorchenko v. Paul, 2024 NY Slip Op. 33748(U), holding that a shareholder lacks standing to bring a direct claim based on injury to the corporation . . . Continue reading Shareholder Lacks Standing to Bring Direct Claim Based on Injury to Corporation

Commercial Case Notes / Derivative Actions

Demand Futility Allegation Sufficiently Specific Based on Totality of Allegations

On August 6, 2024, Justice Ruchelsman of the Kings County Commercial Division issued a decision in Kordonsky v. Brudoley, 2024 NY Slip Op. 32768(U), holding that demand futility allegations in a derivative action were sufficiently specific based on the totality of the allegations . . . Continue reading Demand Futility Allegation Sufficiently Specific Based on Totality of Allegations

Commercial Case Notes / Derivative Actions

Court Orders Production of Tax Returns Despite Heavy Burden of Justifying Production

On December 14, 2023, Justice Murphy of the Nassau County Commercial Division issued a decision in Parizat v. Meron, 2023 NY Slip Op. 34587(U), ordering the production of tax returns despite the heavy burden of justifying their production . . . Continue reading Court Orders Production of Tax Returns Despite Heavy Burden of Justifying Production

Commercial Case Notes / Derivative Actions

When Entity Has No Board, Pre-Suit Demand Before Bringing a Derivative Action is Futile

On July 12, 2023, Justice Masley of the New York County Commercial Division issued a decision in Nusimow v. Pinchevsky, 2023 NY Slip Op. 32345(U), holding that when an entity has no board, pre-suit demand before bringing a derivative action is futile . . . Continue reading When Entity Has No Board, Pre-Suit Demand Before Bringing a Derivative Action is Futile

Commercial Case Notes / Derivative Actions

Derivative Action Barred by Internal Affairs Doctrine

On June 22, 2023, the First Department issued a decision in Haussmann v. Baumann, 2023 NY Slip Op. 03407, holding that the internal affairs doctrine barred a derivative action . . . Continue reading Derivative Action Barred by Internal Affairs Doctrine

Commercial Case Notes / Derivative Actions

Internal Affairs Doctrine Applies to Choice of Law Governing Standing in Derivative Actions

On June 1, 2023, the First Department issued a decision in Ezrasons, Inc. v. Rudd, 2023 NY Slip Op. 02938, holding that the internal affairs doctrine applies to the choice of law governing standing in derivative actions . . . Continue reading Internal Affairs Doctrine Applies to Choice of Law Governing Standing in Derivative Actions

Commercial Case Notes / Derivative Actions

LLC Members Could Not Prevail on Direct Claims Because the Damages the Defendant Allegedly Caused Were to the LLC

On August 2, 2022, the First Department issued a decision in Mohinani v. Charney, 2022 NY Slip Op. 04782, holding that LLC members could not prevail on direct claims for breach of fiduciary duty against the LLC’s manager because the injury they alleged was to the LLC, and thus their claims were derivative . . . Continue reading LLC Members Could Not Prevail on Direct Claims Because the Damages the Defendant Allegedly Caused Were to the LLC

Commercial Case Notes / Derivative Actions

Derivative Plaintiff’s Motives are Irrelevant to its Standing to Bring a Derivative Claim

On July 18, 2022, Justice Ruchelsman of the Kings County Commercial Division issued a decision in Larsen v. Larsen, 2022 NY Slip Op. 32415(U), holding that a derivative plaintiff’s motives are irrelevant to its standing to bring a derivative claim . . . Continue reading Derivative Plaintiff’s Motives are Irrelevant to its Standing to Bring a Derivative Claim

Category: Derivative Actions

Person Who Acquired Ownership LLC Interest did not Also Become Member or Have Standing to Bring Derivative Action

No Jury Trial in Derivative Action

Shareholder Lacks Standing to Bring Direct Claim Based on Injury to Corporation

Demand Futility Allegation Sufficiently Specific Based on Totality of Allegations

Court Orders Production of Tax Returns Despite Heavy Burden of Justifying Production

When Entity Has No Board, Pre-Suit Demand Before Bringing a Derivative Action is Futile

Derivative Action Barred by Internal Affairs Doctrine

Internal Affairs Doctrine Applies to Choice of Law Governing Standing in Derivative Actions

LLC Members Could Not Prevail on Direct Claims Because the Damages the Defendant Allegedly Caused Were to the LLC

Derivative Plaintiff’s Motives are Irrelevant to its Standing to Bring a Derivative Claim

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