Rachel Lilienthal Stark

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With the assistance of my fellow Stark & Stark Shareholders Daniel J. Sheridan and Henry E. Van Blunk, I have co-authored an important client alert about a law deadline that could impact all limited liability companies in the state of New Jersey. The article discusses the New Jersey Revised Uniform Limited Liability Company Act (RULLCA), which significantly changes many of the legal principles underlying the organization, governance and operation of limited liability companies.  While,…
Many businesses, especially start-ups, find that it makes sense to engage freelance consultants for particular tasks rather than adding employees to their payroll.  There are many financial and strategic reasons for a company to engage a consultant for certain projects, such as flexibility, expertise, and efficiency.  However, it is important that companies identify which types of projects are suitable to be done by consultants rather than employees, and what legal issues should be addressed when…
The Revised Uniform Limited Liability Company Act (the “New Jersey Revised Uniform LLC Act”), was enacted into law on September 19, 2012 and went into effect on March 18, 2013.  It applies to LLC’s formed on or after March 18, 2013 and LLC’s formed prior to March 18, 2013 which elected to be subject to the New Jersey Revised Uniform Act.  It will apply to all New Jersey LLC’s beginning on April 1, 2014. One…
The Revised Uniform Limited Liability Company Act (the “New Jersey Revised Uniform LLC Act”), was enacted into law on September 19, 2012.  It will go into effect 180 days after enactment, which is March 18, 2013, and will apply to LLC’s formed on or after March 18, 2013 and LLC’s formed prior to March 18, 2013 which elect to be subject to the New Jersey Revised Uniform Act.  It will apply to all New Jersey…
In Cain v. Merck & Co. Inc., the New Jersey appellate division recently ruled that the New Jersey Business Corporation Act (N.J.S.A 14A:5-28(4)) allows shareholders with a proper purpose to inspect the minutes of the board of directors and executive committee of the corporation.   The question in the case was whether the reference to the term “minutes” in Section 14A:5-28(4) includes board and executive committee minutes (A shareholder may “compel the production for examination…
As more and more business owners are forming limited liability companies (“LLC’s”) to operate their businesses, familiarity with the statute that governs limited liability companies (which in New Jersey is the New Jersey Limited Liability Company Act (the “LLC Act”)) is important.  Most provisions of the LLC Act can be preempted by the LLC’s Operating Agreement, which is the agreement among the members of the LLC that governs its conduct and affairs.  If the LLC’s…
As times are getting tougher for businesses, and the State of New Jersey is getting more hungry for tax revenues, we are seeing a crackdown by the State on enforcement of the bulk sale notification requirements.  The statute containing those requirements, N.J.S.A. 54:32B-22(c), provides as follows:   (c) Whenever a person required to collect tax shall make a sale, transfer, or assignment in bulk of any part or the whole of his business assets, otherwise…
In a limited liability company (LLC), if no operating agreement (the agreement between the members of the LLC) is in place, the limited liability company statute of the state where the LLC was formed controls the relationship between the members of the Company. It is important that the members cover as much as possible in the Operating Agreement, rather than relying on the default provisions in the LLC statute. One example of what can happen…
The Community Hospital Group, Inc. v. More The New Jersey Supreme Court recently decided the case of The Community Hospital Group, Inc. v. More, finding that a restrictive covenant in an employment contract between a hospital and a physician is not per se unreasonable and unenforceable. The general test of whether a physcian’s restrictive covenant should be enforced are (1) whether the covenant is necessary to protect the legitimate interests of the employer, (2) whether…
Travelodge Hotels, Inc. v. Honeysuckle Enterprises., Inc. In Travelodge Hotels, Inc. v. Honeysuckle Enterprises., Inc., 2005 WL 356958 (D.N.J.), the plaintiff, franchisor Travelodge Hotels, Inc. sued the defendant, franchisee Honeysuckle Enterprises, to collect liquidated damages and unpaid royalties under the License Agreement between Travelodge and Honeysuckle. The franchisee argued that the franchisor fraudulently induced him into entered into the license agreement by telling him, among other things, that by being part of the Travelodge reservation…