After Hurricane Katrina struck the Gulf Coast, James Williford, Patricia Mosser, Marquetta Smith, and Michael Floyd formed

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After Hurricane Katrina struck the Gulf Coast, James Williford, Patricia Mosser, Marquetta Smith, and Michael Floyd formed Blue water Logistics, LLC, to bid on construction contracts. Under Mississippi law, every member of a member-managed LLC is entitled to participate in managing the business. The operating agreement provided for a "super majority" 75 percent vote to remove a member who "has either committed a felony or under any other circumstances that would jeopardize the company status" as a contractor. After Blue water had completed more than $5 million in contracts, Smith told Williford that she, Mosser, and Floyd were exercising their "super majority" vote to fire him. No reason was provided. Williford sued Blue water and the other members. Did Smith, Mosser, and Floyd breach the state LLC statute, their fiduciary duties, or the Blue water operating agreements? Discuss.
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The Legal Environment of Business Text and Cases

ISBN: 978-1305967304

10th edition

Authors: Frank B. Cross, Roger LeRoy Miller

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