Also known as: LLC · limited liability company
Written by attorneys · grounded in primary & secondary sources — see below
A business entity formed under state law that shields its members from personal liability for the entity's debts while permitting flexible management and pass-through taxation.
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Liberty Trust, an LLC whose sole member resides in Illinois, sues a Delaware corporation in federal court over a contract dispute. The defendant moves to dismiss for lack of diversity. The court treats the LLC as an unincorporated association and examines the citizenship of its member rather than any state of formation or principal place of business.
Lunar Dynamics, an LLC, winds up after paying all creditors. It holds surplus funds traceable to unreturned member contributions. The liquidator first returns those contributions in full before allocating any remaining surplus among members according to their pre-dissolution distribution rights.
Legacy Motors, an LLC operating a parking facility, requires employees to sign individual arbitration agreements covering workplace disputes. When a union challenges the agreements, the LLC asserts that the contracts bind the employees to arbitration rather than litigation.
A California plaintiff sues Lone Peak Energy, a Delaware LLC with its principal place of business in Texas, in a California federal court for injuries occurring abroad. The LLC moves to dismiss, arguing that its subsidiary's California contacts cannot be attributed to it for general jurisdiction purposes.
TransUnion LLC, a credit reporting agency, generates reports containing inaccurate information about consumers. Several individuals sue the LLC alleging statutory violations. The LLC contends that only those who actually obtained and relied on the reports have standing to sue.
MercExchange, L.L.C. obtains a jury verdict that eBay infringed its patent. The LLC seeks a permanent injunction barring further sales of the infringing feature. The court weighs the traditional four-factor test rather than granting the injunction automatically upon a finding of infringement.
An LLC is treated as an unincorporated association. Its citizenship is that of each of its members rather than any state of formation or principal place of business.
Supporting sources
After paying creditors, surplus is first returned to holders of transferable interests for unreturned contributions and then allocated among those holders in proportion to their pre-dissolution rights to distributions.
Supporting sources
…the United States, where its subsidiary, Mercedes-Benz USA, LLC (MBUSA), distributes Daimler vehicles. MBUSA is a Delaware limited liability company and has its principal place of business in New Jersey. MBUSA’s marketing and sales efforts in California are undertaken by a regional office in Costa Mesa and a network of independent…