Legal Question in Business Law in Delaware

I have 51% share in a Delaware LLC and my partner and I are hostile. He is selling products owned by the company on the side and attempted to use company funds to pay for his home internet which was not approved by the company. I have loaned the company 60K and he placed a patent in the company name. Our Corporate dissolution states that 2/3 of the members of the board would need to vote for dissolution. We are split 50/50 since there are 4 members husband/wife team. How do we cancel/dissolve this company since I do not want the liability and he is operating outside the company without giving the company its due share. He is trying to get the patent back without paying for the loan and is not responding. How can I resolve with with someone who is unreasonable and not responsive.

Asked on 10/28/17, 2:51 pm

1 Answer from Attorneys

Bruce McCullough Bodell Bove', LLC

Your first option is to attempt to negotiate an agreement to dissolve the LLC. You should weigh the real possibility that you would have to give up some financial rights which you may be entitled to as a 51% owner versus the considerable expense and uncertainty of litigation.

The Court of Chancery does have the power to dissolve an LLC pursuant to 6 Del. C. ยง 18-802: "On application by or for a member or manager the Court of Chancery may decree dissolution of a limited liability company whenever it is not reasonably practicable to carry on the business in conformity with a limited liability company agreement." Judicial dissolution is an extreme remedy that the Court is reluctant to use, however, so a non-litigated resolution should be pursued initially. With a non-responsive co-owner, legal representation could be helpful, even if litigation is not to be initiated.

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Answered on 10/30/17, 9:08 am

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