Noncompetes In An Asset Purchase Agreement Can Be Enforceable Even If Some Of Seller’s Earn-Out Was Not Paid

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In InsureOne Indep. Ins. Agency, LLC v. Hallberg, 2012 IL App (1st) 92385, http://www.state.il.us/court/Opinions/AppellateCourt/2012/1stDistrict/1092385.pdf  (Ill. App., 2012), the court held that a failure to pay approximately 2% of an earn-out, which was 1% or less of the agreed purchase price, was not enough to cancel a seller and his son’s noncompete obligations under the asset…

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Purchase Of Almost All Of A Business’s Assets Valid Though Manager Lacked Authority To Sell

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In B&C Realty of Ill., LLC v. Chi. Stand-Up Mri, LLC, 2013 IL App (1st) 112064, http://www.state.il.us/court/r23_orders/appellatecourt/2013/1stdistrict/1112064_r23.pdf (Ill. App., 2013), the court held that a buyer of real property that constituted substantially all of the assets of a manager-managed limited liability company could win a title action against a co-manager of the LLC and the…

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Be Sure You Secure The Property You Need To Back Up A Family Business Loan

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In Diotallevi v. Diotallevi, 2013 IL App (2d) 111297, http://www.state.il.us/court/Opinions/AppellateCourt/2013/2ndDistrict/2111297.pdf (Ill. App., 2014), the court denied claims by relatives of a divorced couple to two land trust properties that were made more than five years after the relatives made loans to the couple for their tree nursery business. The couple formed an LLC including the…

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Third Party Fraud Is No Defense To A Bank’s Mortgage Rights, If You Sign Away Your Property And Don’t Record Your Liens

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In Stump v. Swanson Development Co., 2014 IL App (3d) 110784, http://www.state.il.us/court/Opinions/AppellateCourt/2014/3rdDistrict/3110784.pdf, Feb. 10, 2014, the court held that a Mr. Stump had been induced to sign a deed to some real estate by fraud, and held that two individuals were liable for failing to include Mr. Stump in a limited liability company, and for…

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Arbitration Provisions In LLC Agreements Are Enforceable, Even If Other Terms Are Not

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The Ritz-Carlton Management Company (RCMC) was able to compel arbitration as provided for in a condominium association LLC operating agreement, even though condominium owners alleged the agreement was unconscionable, and that RCMC had committed fraud. (Ritz-Carlton Mgmt. Co. v. Ass’n of Apartment Owners of Kapalua Bay Condo. (D. Haw., 2013), rehearing denied, http://www.gpo.gov/fdsys/pkg/USCOURTS-hid-1_13-cv-00055/pdf/USCOURTS-hid-1_13-cv-00055-1.pdf ) The…

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Unusual and Unfortunate News For April 1, 2014

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April 1 brings interesting and dubious news items to light, and this newsletter preserves them for posterity. Say hello, posterity! You may want to try to forget these:   — Darth Vader is officially registered as a candidate for President of the Ukraine: https://www.youtube.com/watch?v=X9h4VA3bc-8 — American Eagle is “launching” an “American Beagle” line of sportswear:…

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