Reference no: EM131274889
A Westbury Properties, Inc., and others (collectively, the Westbury Group) owned, managed, and developed real property. Jerry Stoker and The Stoker Group, Inc. (the Stokers), also developed real property. The Westbury group entered into agreements with the Stokers concerning a large tract of property in Houston County, Georgia.
The parties formed LLCs, including Bellemeade, LLC (the LLC Group), to develop various parcels of the tract for residential purposes. The operating agreements provided that "no Member shall be accountable to the [LLC] or to any other Member with respect to [any other] business or activity even if the business or activity competes with the [LLC's] business." The Westbury Group entered into agreements with other parties to develop additional parcels within the tract in competition with the LLC Group.
The Stokers filed a suit in a Georgia state court against the Westbury Group, alleging, among other things, breach of fiduciary duty. What duties do the members of an LLC owe to each other? Under what principle might the terms of an operating agreement alter these duties? In whose favor should the court rule?
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