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Berger Harris partners Michelle Quinn and Brian Gottesman hosted a CLE webinar entitled “Fiduciary Duties in LLCs and LPs: Considerations for Modifying or Waiving Duties of Alternative Entity Managers.” The webinar, presented by Strafford Publications, Inc., was co-presented with Delaware attorney Melissa Stubenberg of Richards Layton & Finger.
Strafford’s program description reads:
This CLE webinar will review the fiduciary duties limited partnership (LP) general partners and limited liability company (LLC) managers, managing members, and controlling members owe members of the alternative entity, using statutory and case law from Delaware and other key states as a backdrop. The panel will outline the circumstances under which fiduciary duties may be waived or modified by agreement of the parties and the legal risks of doing so. The panel will also discuss best practices for drafting fiduciary waiver provisions in entity operating agreements that are likely to withstand legal challenges.
LPs and LLCs can modify the fiduciary duties owed to their members via contract provisions in the entity’s operating agreement. However, determining whether to expand, restrict or eliminate the fiduciary duties of LP general partners or LLC managers, managing members, or controlling members requires a careful analysis of the motivation for and potential consequences of doing so.
Counsel advising LPs and LLCs must understand the implications of recent case law in Delaware and other key states for modifying LLC and LP fiduciary duties, including how courts have applied the implied covenant of good faith and fair dealing when interpreting duty modification or waiver clauses in entity operating agreements. Counsel must develop effective strategies for negotiating fiduciary waiver provisions in the operating agreement.
Listen as our authoritative panel of business attorneys guides you through the latest legal developments regarding the modification or waiver of fiduciary duties in the context of LLCs and LPs. The panel will discuss when fiduciary duties can be altered or eliminated and best practices for drafting fiduciary duty waiver provisions in the entity operating agreement.
Berger Harris attorneys have extensive experience in rendering advice and legal opinions in a wide variety of transactions involving Delaware partnerships, limited liability companies, and statutory trusts, including investment fund, joint venture and structured finance transactions. They have rendered opinions covering such issues as due formation, good standing, power and authority, and nondissolution under state law, authority to file bankruptcy, perfection under the UCC, substantive nonconsolidation and “true lease” issues under federal bankruptcy law. Berger Harris attorneys have also litigated a wide array of issues pertaining to fiduciary duties of equity holders and managers of various kids of Delaware business entities.
Together with retired Delaware attorney Richard Levin, Michelle and Brian are the authors of “Third-Party Delaware Opinions for Structured Finance and Other Commercial Transactions,” previously published on the Business Law Basics blog.