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84 Chi.-Kent L. Rev. 271 (2009-2010)
Series Limited Liability Companies: A Possible Solution to Multiple LLCs

handle is hein.journals/chknt84 and id is 277 raw text is: SERIES LIMITED LIABILITY COMPANIES: A POSSIBLE SOLUTION TO MULTIPLE LLCS SANDRA MERTENS* INTRODUCTION Series Limited Liability Companies (LLC) are now over a decade old.' This idealistic concept has seemingly transformed organizational law, touting opportunities and flexibility far surpassing existing entity options. However, this eleven-year period has passed leaving corporate and tax lawyers clueless on important topics such as tax guidance from the Internal Revenue Service (IRS), legislative history, state treatment of foreign series LLCs,2 and case law. While heralded in theoretical circles, many practicing attorneys fail to recommend series LLCs to their clients due to the plethora of unanswered questions.3 In fact, business owners can achieve analogous results with multiple LLCs while maintaining relative certainty in their choice. Further, only seven states to date have enacted statutes authorizing series LLCs, and the drafters of the recent Revised Uniform Limited Liabil- ity Company Act (RULLCA) considered and rejected provisions to the RULLCA creating series LLCs.4 These facts beg the question: Why should we care about series LLCs? This Note compares and contrasts aspects of multiple LLCs with those of series LLCs.5 It focuses primarily on Delaware and Illinois, as these states present leading ideas on series LLC laws even as they draw material * Attorney, Dale & Gensburg, P.C. in Chicago, Illinois; graduated from Chicago-Kent College of Law and was admitted to the Illinois Bar in 2008. The author is deeply indebted to many people who contributed to this project, including Felice Batlan, Evelyn Brody, Carter Bishop, Charles Remmel II., Chuck Moles, Dan Kleinberger, Lin Hanson, Michael Savasuk, Steve Frost, Terry Anderson, Anthony Calandriello, David Walker, and Thomas Rutledge. 1. The State of Delaware passed the first legislation authorizing series LLCs in 1996. H.B. 528, 138th Gen. Assem., 2d Sess. (Del. 1996), amended by DEL. CODE ANN. tit. 6, § 18-215 (West Supp. 2008). 2. Since the state law of the jurisdiction of formation governs business entities such as LLCs, the term foreign refers to entities formed outside of the state. 3. See infra, Part IV.2. 4. See infra, Part II.4. 5. This Note will refer to the former only as multiple LLCs, while referring to the latter throughout as series LLCs. It will distinguish between the LLC which formed the series as umbrella LLC or Parent LLC, while referring separately to the individual series.

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