Legal Question in Business Law in California

Yes. If they did not present this opportunity to the existing LLC first, then you have a significant case against them.

Well, although what the previous attorney stated is probably accurate, it will depend upon what the LLC Operating Agreement states and what has been the past conduct of the LLC members.

Do you have an Operating Agreement and a history of what the members have been doing with other business opportunities?

By Grace...

Shawn Jackson ESQ. (707) 584-4529

Business Development Attorney EMAIL: [email protected]

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I agree with Mr. McCormick. People with ownership roles in partnerships, LLCs and smaller corporations have a fiduciary duty of loyalty to the business, and generally, to the co-owners. Probably a suit should be brought (if necessary) both as a direct action in your name, and as a derivative action on behalf of the LLC. An examination of the LLC's operating agreement would be necessary to see what, if anything, it says about loyalty and competition.

The other owners are probably breaching their fiduciary duty to you, but not necessarily. Mr. Jackson has noted some possible reasons why.

It's also possible that the new bar will not compete directly against the existing one. You haven't said how far down the street the other bar is, but distance matters. If the two bars have very different themes and/or cater to very different client�le, you might have a harder time winning a case against your partners.

You should meet with an attorney as soon as possible to discuss your options. The longer you wait now that you know what they're up to, the harder it will be for you to prevail if you do end up in court.