1. Based on the court’s decision, what specific rights did Lieberman lose when he withdrew as a…

1. Based on the court’s decision, what specific rights did Lieberman lose when he withdrew as a member of the LLC?
2. What kind of language and methodology could be included in an operating agreement that could have prevented this dispute?

Lieberman was a member and employee of Wyoming.com, LLC, with a $20,000 ownership stake, but was terminated as an employee following a dispute occurring four years after formation. Lieberman served the LLC with a “notice of withdrawal” and demanded that the LLC pay for Lieberman’s “share of the company” in the amount of $400,000. The LLC held a vote in which they accepted Lieberman’s withdrawal, but offered him only $20,000 because that was his initial ownership stake. Lieberman rejected the $20,000 offer and the LLC filed suit asking for a declaratory judgment of its rights against Lieberman because the operating agreement was silent on the issue of dissociation.

 

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