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Streck, Inc. v. Ryan Family
297 Neb. 773
| Neb. | 2017
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Background

  • Streck, Inc. sued Ryan Family, L.L.C. seeking specific performance of an option to purchase real property leased to Streck, alleging the option was validly exercised and closing did not occur.
  • The L.L.C. is managed by two co-managers (Wayne and Connie Ryan); a receiver was appointed at the co-managers’ joint request to represent the L.L.C. in the lawsuit after managerial deadlock.
  • The receiver filed an answer and counterclaim on behalf of the L.L.C., asserting Streck was in default when it attempted to exercise the option.
  • Stacy Ryan (a ~20% nonmanaging member) filed a complaint in intervention seeking to intervene both individually and derivatively on behalf of the L.L.C., challenging receiver conduct and the managers’ actions.
  • The district court denied Ryan’s motions to intervene and to continue the pending summary judgment hearing; Ryan appealed the denial of intervention.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether order denying intervention is appealable Ryan: denial is final and appealable Streck: § 25-1315 requires express language to make partial orders final Court: order denying intervention is a final, appealable order under Nebraska precedent
Whether Stacy Ryan may intervene in her personal capacity Ryan: as 20% L.L.C. member she will gain/lose financially and thus has direct legal interest Streck/L.L.C.: member is nonmanaging, lacks authority; financial impact is indirect Court: no—financial consequences to a member are indirect; no direct legal interest to intervene personally
Whether Ryan may intervene on behalf of the L.L.C. (derivatively) Ryan: receiver and managers are not fully protecting L.L.C.; she should protect company interests in litigation L.L.C./Streck: receiver was appointed and is representing the L.L.C.; managers’ authority and receiver’s role preclude member intervention Court: no—Holmes exception inapplicable; receiver is representing L.L.C. and Ryan alleged no complete failure to protect corporate interests
Whether Ryan could expand litigation scope (challenge receiver/operating agreement) Ryan: sought to challenge appointment and alleged manager breaches Streck/L.L.C.: intervention limited to same core issues between original parties Court: disallowed—intervenor may only raise issues that sustain or oppose original parties’ contentions; challenges were beyond dispute over lease/option

Key Cases Cited

  • Ruzicka v. Ruzicka, 262 Neb. 824 (appellate review of intervention is de novo)
  • Spear T Ranch v. Knaub, 271 Neb. 578 (requirements for intervention; intervenor must allege direct legal interest)
  • Basin Elec. Power Co-op v. Little Blue N.R.D., 219 Neb. 372 (order denying intervention treated as final)
  • Steinhausen v. HomeServices of Neb., 289 Neb. 927 (LLC member cannot maintain individual claim for wrongs to the LLC)
  • State v. Holmes, 60 Neb. 39 (limited exception allowing shareholder to intervene when corporation wholly fails to protect stockholders)
Read the full case

Case Details

Case Name: Streck, Inc. v. Ryan Family
Court Name: Nebraska Supreme Court
Date Published: Sep 15, 2017
Citation: 297 Neb. 773
Docket Number: S-16-664
Court Abbreviation: Neb.