The Hidden Dangers of “Withdrawing in Principle” from an LLC

For many New York LLCs, relationships change long before paperwork does. A member may stop participating in operations, stop contributing capital, or declare themselves “withdrawn” from the business. But as Sealy v. Clifton LLC  illustrates, failing to formally transfer or assign a membership interest —or to seek judicial dissolution —can create years of uncertainty, litigation, and financial exposure. 1. You’re Still a Member Until the Law Says You’re Not In Sealy , the administrator of a…