In re GR BURGR, LLC

GR BURGR, LLC (GRB) was a limited-liability company (LLC). GRB’s two members were GR US Licensing, LP (GRUS) (plaintiff), an entity owned by Gordon Ramsey, and Rowen Siebel (defendant). GRUS and Siebel each owned a 50 percent membership interest in GRB. GRUS designated Stuart Gillies, and Siebel designated himself, to serve as GRB’s managers. GRB’s LLC agreement required all business decisions to be made by a unanimous vote of the two managers. GRB’s LLC agreement did not provide a mechanism to break deadlocks. GRUS gave GRB the right to license GRUS’s trademark. GRUS transferred the licensing rights to an affiliate of Caesars Entertainment Corporation (Caesars). If Caesars deemed either of GRB’s members unsuitable, Caesars had the right to cancel the licensing agreement or demand that GRB terminate its relationship with the unsuitable member. Siebel and Ramsey’s relationship soured. After Siebel was convicted of tax-law violations, Caesars demanded that GRB terminate its relationship with Siebel. GRUS demanded that Siebel dissociate from GRB. Siebel offered to assign his membership interest in GRB to a family trust so that Siebel would no longer be directly involved with the licensing agreement with Caesars. GRUS rejected Siebel’s offer. When Siebel refused to dissociate, GRUS filed a petition to dissolve GRB. Siebel opposed the petition, arguing that GRUS sought judicial dissolution of GRB in bad faith to exploit the existing business relationship with Caesars for itself by excluding Siebel from the business relationship.