Section 10A-5-4.04

Derivative actions. REPEALED IN THE 2014 REGULAR SESSION BY ACT 2014-144 EFFECTIVE JANUARY 1, 2017.

(a) A member may bring an action in the right of a limited liability company to recover a judgment in its favor if the members or managers with authority to do so have refused to bring the action or if an effort to cause those members or managers to bring the action is not likely to succeed.

(b) In a derivative action, the plaintiff shall be a member (1) at the time of bringing the action or have succeeded to the right of a member by operation of law or pursuant to the terms of the operating agreement from a person who was a member and (2) at the time of the transaction of which he or she complains.

(c) In a derivative action, the complaint shall set forth with particularity the effort of the plaintiff to secure initiation of the action by the members or managers with authority to do so, or the reasons for not making the effort.

(d) If a derivative action is successful, in whole or in part, or if anything is received by the plaintiff as a result of a judgment, compromise, or settlement of an action or claim, the court may award the plaintiff reasonable expenses, including reasonable attorney's fees, and shall direct the plaintiff to remit to the limited liability company the remainder of those proceeds.

(Acts 1993, No. 93-724, p. 1425, §25; §10-12-25; amended and renumbered by Act 2009-513, p. 967, §230.)