Court of Chancery procedures, member inspection rights, fiduciary duty enforcement, and pre-litigation dispute resolution for Delaware limited liability companies.
Nearly every VC-backed startup and sophisticated business is organized as a Delaware LLC. When internal disputes arise—books and records demands, voting rights violations, unpaid distributions, or fiduciary duty breaches—Delaware law and the Court of Chancery provide the framework for resolution.
I handle Delaware LLC disputes with a focus on pre-litigation demand letters that leverage Delaware's member-protective statutes and the threat of Chancery Court enforcement. Whether you're a minority member being frozen out or a manager defending against an inspection demand, understanding Delaware's unique legal landscape is critical.
Why Delaware is different: The Delaware Limited Liability Company Act (6 Del. C. §§ 18-101 et seq.) provides strong default member rights while allowing contractual flexibility. The Court of Chancery decides cases quickly with specialized business judges (no juries). Delaware law is more developed and predictable than any other state.
Section 18-305 inspection rights, proper purpose requirements, member lists, financial records, tax returns. Court of Chancery enforcement procedures.
→Manager elections, member consent violations, voting deadlocks, operating agreement interpretation. Enforcement of governance rights.
→Member distribution disputes, profit allocation disagreements, management fee conflicts, capital account reconciliation demands.
→Duty of loyalty violations, self-dealing, corporate opportunity theft, duty of care failures. Default duties vs. contractual modifications.
→Section 18-802 judicial dissolution, "not reasonably practicable" standard, fair value buyouts, winding up procedures.
→Multi-state books and records overview including Delaware Section 18-305, California Section 17704.10, and general corporate inspection rights.
→The DLLCA (6 Del. C. §§ 18-101 et seq.) governs all Delaware LLCs. Key sections for internal disputes:
The Delaware Court of Chancery has exclusive jurisdiction over LLC internal affairs disputes. Key advantages:
| Issue | Delaware | California |
|---|---|---|
| Inspection Rights | Section 18-305 - broad member access | Section 17704.10 - similar rights |
| Fiduciary Duties | Can be modified/eliminated by agreement | Cannot be eliminated entirely |
| Judicial Dissolution | "Not reasonably practicable" standard | Similar standard + deadlock provisions |
| Court Venue | Specialized Court of Chancery | General civil courts |
| Case Law | Extensive, well-developed precedent | Less developed LLC case law |
Members have statutory rights to obtain LLC records. Common scenarios:
Disputes over decision-making authority and member consent:
Financial disputes between members:
Manager or member disloyalty:
Terminating the LLC or buying out members:
Before filing in the Court of Chancery, a well-drafted demand letter can:
I draft Delaware LLC demand letters that leverage Court of Chancery procedures and DLLCA statutes to maximize settlement leverage. $450 flat fee for demand letters, $240/hr for consultation and litigation support.
Contact: owner@terms.lawI handle Delaware LLC disputes with a focus on efficient pre-litigation resolution using demand letters that demonstrate command of Delaware law and Chancery Court procedures.
I focus on Delaware LLCs because the law is more developed, courts are more sophisticated, and outcomes are more predictable than any other state. Having handled California LLC disputes extensively, I understand both jurisdictions and can leverage Delaware's member-protective statutes and efficient Chancery procedures.
Note: I am a California attorney. For Delaware Court of Chancery filings, I prepare documents and coordinate with Delaware counsel. For demand letters and pre-litigation strategy, no Delaware counsel is needed.