Question

In Lieberman v. Wyoming, LLC, Lieberman dissociated from the LLC and demanded cash for his share of the company. The remaining members voted to continue the company, and the operating agreement discussed distribution in the case of dissolution but not simple dissociation. The court decided that:

A. Lieberman had rightfully dissociated from the company but since the operating agreement was silent as to distribution should the company continue, he forfeited all rights upon dissociation and should receive nothing
B. because the operating agreement was silent on the issue, the Uniform Limited Liability Company Act controlled and Lieberman should get his initial investment back but nothing above that
C. fundamental common law rules of fairness should apply and Lieberman was due a fair share to be decided by independent business analysts
D. Lieberman had rightfully dissociated from the company but since the operating agreement was silent as to distribution and state LLC law was also silent regarding the issue, Lieberman should get no distribution for dissociation but would retain his interest in the company until dissolution occurs.

Answer 1

Answer: D. Lieberman had rightfully dissociated from the company but since the operating agreement was silent as to distribution and state LLC law was also silent regarding the issue, Lieberman should get no distribution for dissociation but would retain his interest in the company until dissolution occurs.

Step-by-step explanation:

Michael Lieberman brought a claim against Wyoming LLC because refused to return his requested share of the company’s current value.

The other members of the LLC had decided to accept his withdrawal and move on but refused to return Lieberman’s requested share of the company’s current value which he Estimated at $400,000.

The court ruled Lieberman had rightfully dissociated from the company but since the operating agreement was silent as to distribution and state LLC law was also silent regarding the issue, Lieberman should get no distribution for dissociation but would retain his interest in the company until dissolution occurs.