LLC – Right to Arbitration
CDIC of NC Protected Cell-A600 LLC v. Judge, No. 4:18-cv-04142 decided June 1, 2021. The U.S. District Court, Southern District of Texas, ruled that the defendant, a manager of an LLC, waived his right to invoke arbitration under a provision of the LLC’s operating agreement stating that any dispute arising out of the agreement or the breach thereof shall be decided by arbitration. He waived his right by proceeding with the court action for over two years before seeking to compel arbitration.
Pro Se Representation
1 Fox 2 Productions, LLC v. Mercedes-Benz USA, LLC, No. 03-20-00101, decided January 4, 2021. The Texas Court of Appeals held that an officer of an LLC, although not a licensed attorney, could file a notice of appeal on behalf of the LLC because the Texas Supreme Court has held that the prohibition against non-attorneys representing business entities does not apply to ministerial tasks such as perfecting an appeal.
Limited Partner’s Standing to Sue
Lipshy v. Burk, No. 05-19-00493, decided November 12, 2020. The Texas Court of Appeals held that limited partners do not lack constitutional standing to assert claims individually for damages based on the reduction in value to their limited partnership interests.
Standing to Sue
Pike v. Texas EMC Management, LLC, No. 17-0557, decided June 19, 2020. The Texas Supreme Court held that a limited partner has constitutional standing to sue for an alleged loss in the value of its interest in the limited partnership. A challenge to a limited partner’s ability to recover the lost value of its interest in the limited partnership is a challenge to capacity, not standing.
Assumed Name Filing Requirement
Pennington v. Cypress Aviation, LLC, No. 05-19-00345, decided April 19, 2020. Although a Texas corporation that failed to file a certificate of assumed name lacked capacity to sue, the defendant waived the right to claim the failure to file as a defense by failing to file a plea in abatement or obtain a ruling regarding the corporation’s lack of capacity prior to trial. The court also ruled the trial court erred in concluding the corporation lacked standing to sue rather than lacking capacity to sue.
Donica Group, LP v. Thompson Excavating, Inc., No. 05-19-00235, decided January 6, 2020. The Texas Court of Appeals held that a corporation whose charter was forfeited and not reinstated lacked standing to file a bill of review challenging a default judgment.