How do I remove my business partner from an LLC who is going to work for one of our competitors?

I am 1 of 2 partners operating under an LLC. Our business is struggling financially and my partner is going to work for another business that provide the same services. Is this business abandonment/ conflict of interest? Can I remove her from the LLC due to the abandonment/conflict? I am willing to continue to operate the company and try to deliver it out of the financial crisis that it is in but wish to remove her from the LLC. We are less than two years old and the desolation process has not been put in place. What are the steps that I need to take to remove her from the LLC?

Asked on July 25, 2012 under Business Law, Texas


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Whether or not you can unilaterally remove a person who has a membership interest in a limited liability company depends upon what the operating agreement states. As such, you need to carefully read the document.

Most likely if you want to eliminate the other person from the limited liability as an owner you will need to purchase his or her interests. For the person who has an interest in your venture to work of a competitor is a clear conflict by that person warranting a buy out under most statutes under each state's corporations code.

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