Tag: Derivative Actions

This post keeps with the theme developed over the past couple weeks of derivative actions, this time in their application to limited liability companies. Interestingly, Washington’s Division Three Court of Appeals threw practitioners a “derivative action curveball” in the 2016 opinion Holman v. Brady, No. 33114-8-III, 2016 WL 4921457 (Wn. App. Sep. 13, 2016). This… Read More

“Until our legislature declares otherwise, Washington is a demand futility state and follows Delaware.” This phrase in the Washington Supreme Court opinion In re F5 Networks, Inc., 166 Wn.2d 229, 240, 207 P.3d 433 (2009) had a significant impact on derivative action litigation throughout the State of Washington. I write this post in an effort… Read More

The derivative action is the source of increasing consternation throughout the legal industry. Today’s post brings a little insight into the fundamentals of a derivative action in Washington. What is it? A derivative action permits a shareholder or member the right to sue third parties on behalf of the entity. The purpose behind the derivative… Read More