In The Follieri Group LLC v . Follieri/Yucaipa Investments, LLC, 2007 WL 2459226 (Del. Ch., Aug. 23, 2007), read opinion here, the Chancery Court decided a preliminary issue in a business dispute involving a joint venture entered into by the rich and famous. The Court denied the effort of a putative creditor (of the LLC sought to be dissolved) to intervene pursuant to Chancery Court Rule 24(a)[as of right] or 24(b)[permissively]. The issue in the main attraction [original complaint] was an attempt by one of the parties to the LLC to dissolve it pursuant to Section 18-802 of the Delaware Limited Liability Company Act. That section allows for dissolution when it is no longer reasonably practicable to carry on the business of an LLC pursuant to the operating agreement. The court reasoned that the attempt by the creditor to collect an alleged debt had nothing whatsoever to do with the issue to be decided under Section 18-802 of the Delaware LLC Act. Moreover, if a dissolution were ultimately ordered, both Sections 18-803 [winding-up] and 18-804 [distribution of assets] of the LLC Act provide for dealing with creditors.
The parties to this dispute include billionaire Ron Burkle and Raffaello Follieri, an aristocratic young gentleman from Italy, who is well-known among upper-crust circles in his own right, but became more famous during the last few years if only because his frequent female companion is the movie actress, Anne Hathaway (The Devil Wears Prada and Becoming Jane). Here is a recent celebrity photo and background story for those of you who do not read People magazine or the National Enquirer (which I assume is 99.9% of the readership of this blog.) An article from The Wall Street Journal here has slightly more business-minded background about the plaintiff in this case.
UPDATE: Here is a link to a front page article in The Wall Street Journal about Follieri on September 26, 2007 that also references the pending litigation.