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Attorney Brick Wins Injunction Hearing in LLC Derivative Action

On Behalf of | Jun 7, 2016 | Firm News |

On June 3, in the case of Yifat Shaolm, et. al. v. Nissim Sabatani, the Hon. Bruce Boyer of the Pinellas County Circuit Court conducted on evidentiary hearing on the Plaintiff’s Emergency Motion For Temporary Injunction Without Notice and to Expel And Dissociate Defendant As a Member of Reflection Fashions, LLC.  The Plaintiffs sought wide-ranging relief in their Motion, ultimately attempting to have the court remove the Defendant as a Member of his business and to have the Plaintiffs unilaterally control all operations of the business.  This relief was sought by the Plaintiffs under an alleged oral operating agreement as well as under the new Florida Revised Limited Liability Company Act, which permits involuntary judicial dissociation of a member.

Attorney Brick made his initial appearance in the case for the Defendant shortly after the Motion was filed and denied the Plaintiff’s attempt to have the outcome of the hearing determined without an opportunity for the Court to hear argument from the Defendant. (Florida Rule of Civil Procedure 1.610 permits an injunction to be entered against a litigant in certain circumstances without providing notice of the hearing to that litigant or an opportunity for them to be heard by the Court.). Additionally, the court denied the Plaintiff’s request to designate the hearing as emergency in nature.  Finally, at the June 3 full evidentiary hearing on the Plaintiff’s Motion, the Court agreed with Attorney Brick and completely denied all relief requested by the Plaintiff.  As a result, the Defendant has maintained all of his management and ownership rights in his business during the pendency of the case.

Attorney Brick has also filed a Motion to Dismiss the Plaintiffs’ Complaint in its entirety on behalf of the Defendant due, in part, to a misjoinder of direct and derivative causes of action.  A motion hearing on the matter is forthcoming.

Attorney Brick is a business litigation attorney in Tampa, Florida.  His practice is focused on cases that are commonly known as “business divorce” cases which generally involve disputes between or among common owners of a business.  Such cases sometimes involve “direct” actions by one business owner against another or “derivative” actions where one business owner sues another on behalf of the corporation to assert the rights of the jointly-owned business.  The new Florida Revised Limited Liability Company Act has changed numerous aspects of direct and derivative shareholder actions when they involve a Florida limited liability company.  (When the corporation at issue is a traditional corporation other statutes apply).

Direct and derivative shareholder lawsuits often involve claims of theft, breach of fiduciary duties and breach of operating agreements.  They can also involve requests for other relief, such as an accounting, injunction or declaratory relief.  In certain situations, the Court can also appoint a receiver or custodian to oversee the operations of the business or judicially dissolve the business.  A business litigation attorney should review all of the potential avenues for relief with his client in a potential business divorce case at the outset of the case to ensure that the client is aware of his options and that the litigation is focused on achieving the desired results.

To learn more about direct and derivative shareholder lawsuits in Florida, visit our page on shareholder derivative litigation.  If you would like to contact us to ask questions about an existing or potential business divorce case or general business litigation case in or around central Florida, please contact us to set up a free initial consultation by phone or in our downtown Tampa office.