Summary: Derivative suits let owners enforce the company’s rights when insiders won’t. Done right, they’re powerful. Done wrong, they’re dismissed. Here’s a field guide for LLCs and closely held corporations.
Who can sue and when?
LLCs: Members may sue derivatively under 805 ILCS 180/40‑1 when managers/members harm the company. Relief can include restitution, constructive trusts, injunctions, and fees—plus orders to stop unilateral withdrawals or restore records access.
Corporations: Shareholders proceed derivatively; the entity is the real party in interest. Oppression claims (for corporations) are addressed separately under 805 ILCS 5/12.56.
Pleading essentials (don’t get 2‑615’ed):
- State your demand (or futility)
Continue Reading Derivative Claims in Illinois: A Practitioner’s Checklist (and Common Traps)
