FORT LAUDERDALE BUSINESS LITIGATION: SERIES LIMITED LIABILITY COMPANY

There are two types of limited liability companies, member-managed limited liability companies and manager managed limited liability companies. In a member-managed limited liability company, each member has the right to vote on the management and conduct of the company. Fla. Stat. § 605.04073. The members vote in proportion to the members’ pro-rata ownership interest in the company and a majority vote prevails unless the company’s operating agreement states differently.  In a manager managed limited liability company, matters relating to the activities and affairs of the company are exclusively decided by the company’s managers. Fla. Stat. § 605.0407. The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The Florida Legislature recently created a new type of limited liability company called a series limited liability company. The new law goes into effect in June 2026, and allows a series limited liability company to create one or more protected series within the company. Fla. Stat. § 605.2102 (defining series limited liability company). Each series is treated as if it were separate and distinct from the series limited liability companies and the other series created within the company. Fla. Stat. 605.2103 (“A protected series of a series limited liability company is a person distinct from… the series limited liability company,… another protected series of the series limited liability company[,] a member of the series limited liability company,… a protected-series transferee… [and] a transferee of a transferable interest of the series limited liability company.”). Therefore, each series within the series limited liability company has all the powers a normal limited liability company would have. Fla. Stat. § 605.2104.

Series limited liability companies can segregate the assets and liabilities of the series away from the parent series limited liability company and the other protected series within the parent series limited liability company. Fla. Stat. § 605.2301 (“Only an asset of a protected series may be an associated asset of the protected series. Only an asset of a series limited liability company may be an associated asset of the company.”); Fla. Stat. § 605.2401 (A “liability of a series limited liability company is solely the debt, obligation, or liability of the company.” A “liability of a protected series is solely the debt, obligation, or liability of the protected series.”). This allows the assets of one series to be protected against creditor liability incurred by the parent series limited liability company or a different protected series within the parent series limited liability company. However, the series limited liability company and its protected series must keep clear records of their distinct assets to prevent fraudulent transfers and other similar nefarious actions. Fla. Stat. § 605.2301. The series limited liability company and each protected series must maintain records describing their assets with sufficient specificity to permit a disinterested identify the assets. The failure to maintain proper records could destroy the segregated status of the assets and liabilities.

While new to Florida, series limited liability companies are used is several other states including Delaware, Illinois and Nevada. Florida likely adopted the series limited liability company so that it could promote it could promote itself as a business focused state thereby attacking investment.

The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.