Conn. Gen. Stat. » Title 34 — · Chapter 613a — Uniform Limited Liability Company Act
Connecticut General Statutes

Conn. Gen. Stat. § 34-271e (2025)

Derivative action. Proceeds and expenses

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(a) Except as provided in subsection (b) of this section: (1) Any proceeds or other benefits of a derivative action, whether by judgment, compromise or settlement, belong to the limited liability company and not to the plaintiff; and (2) if the plaintiff receives any proceeds, the plaintiff shall remit them immediately to the company.

(b) On termination of the derivative proceedings, the court may order: (1) The limited liability company to pay the plaintiff's expenses incurred in the proceeding if it finds that the proceeding has resulted in a substantial benefit to the limited liability company; (2) the plaintiff to pay any defendant's expenses incurred in defending the proceeding if it finds that the proceeding was commenced or maintained without reasonable cause or for an improper purpose; or (3) a party to pay an opposing party's expenses incurred because of the filing of a pleading, motion or other paper, if it finds that the pleading, motion or other paper was not well grounded in fact, after reasonable inquiry, or warranted by existing law or a good faith argument for the extension, modification or reversal of existing law and was interposed for an improper purpose, such as to harass or cause unnecessary delay or needless increase in the cost of litigation. As used in this subsection, “expenses” means reasonable expenses of any kind that are incurred in connection with a matter including, but not limited to, reasonable counsel fees.

(c) A derivative action on behalf of a limited liability company may not be voluntarily dismissed or settled without the court's approval.

(P.A. 16-97, S. 69.)

History: P.A. 16-97 effective July 1, 2017.

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Secs. 34-272 to 34-274. Reserved for future use.

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PART IX

FOREIGN LIMITED LIABILITY COMPANIES

Notes of Decisions
Cited in 2 cases (2 in the last 5 years), 2024–2024 · leading case: Rubin v. Brodie, 325 A.3d 1096 (Conn. App. Ct. 2024).
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Rubin v. Brodie, 325 A.3d 1096 (Conn. App. Ct. 2024). “The defendants do not agree, however, that the court properly determined that the plaintiffs satisfied these requirements. Nor do they agree that, even if proper, the court’s determination should have ended its analysis and caused it to deny the defendants’ motions to dismiss…”
Rubin v. Brodie, 325 A.3d 1096 (Conn. App. Ct. 2024). “Nor do they agree that, even if proper, the court’s determination should have ended its analysis and caused it to deny the defendants’ motions to dismiss the individual plaintiffs’ derivative action, as the plaintiffs claim in this appeal.”
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