MORAL MACHINE

The Impracticability Doctrine for LLCs: Your Exit When Business Becomes Impossible Under New York LLC Law § 702

Remember the episode of Succession where Logan Roy promises Shiv the CEO position, only to pull it away once she’s fully committed? Or when he changes the rules, cutting his children out of distributions while enriching himself through side deals? That’s not just an exciting evening on the couch while enjoying your favorite home cooked meal (steak, always steak), it’s a textbook example of the kind of conduct that makes continued business operation legally “not reasonably practicable” under New York law. Under LLC Law § 702, the test is whether it is “not reasonably practicable to carry on the business in conformity with the articles of organization or operating agreement.” When your business partner starts acting like Logan Roy, LLC Law § 702 becomes your exit strategy.

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ABOUT CHRIS D. WARREN
Chris D. Warren

Member, Scarinci Hollenbeck, LLC. Partnership and Business Litigation Attorney with Passion for the Nexus between Technology and Ethics in the Legal Profession. 

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