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LLC Members Can Bring Derivative Suits: N.Y. Court

Law360 (February 15, 2008, 12:00 AM EST) -- New York's highest court ruled on Thursday that members of limited liability corporations can bring derivative shareholder suits on the corporation's behalf, even though New York law does not explicitly provide for such suits.

The case was filed by partial shareholders in a limited liability corporation that owned a Manhattan apartment building. They alleged that the directors of the company had breached their fiduciary duty by first leasing and then selling the building below market value, to the personal benefit of some fiduciaries.

Despite the limited...
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