Iowa Code » Chapter 489 — UNIFORM LIMITED LIABILITY COMPANY ACT
Iowa Code

Iowa Code § 489.806 (2026)

Proceeds and expenses

✓ Iowa Code 2026 (laws through the 2025 session)
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1. Except as otherwise provided in subsection 2, all of the following apply:

a. 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.

b. If the plaintiff receives any proceeds, the plaintiff shall remit them immediately to the limited liability company.

2. If a derivative action is successful in whole or in part, the court may award the plaintiff reasonable expenses, including reasonable attorney fees and costs, from the recovery of the limited liability company.

3. A derivative action on behalf of a limited liability company shall not be voluntarily dismissed or settled without the court’s approval. 2008 Acts, ch 1162, §70, 155 C2009, §489.906 2023 Acts, ch 152, §70, 143, 161 C2024, §489.806 Former §489.806 repealed effective January 1, 2024, by 2023 Acts, ch 152, §142, 161 \n

Notes of Decisions
Cited in 1 case (1 in the last 5 years), 2025–2025 · leading case: Richard J. Erwin v. Michael G. Erwin, 30 N.W.3d 57 (Iowa Ct. App. 2025).
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Richard J. Erwin v. Michael G. Erwin, 30 N.W.3d 57 (Iowa Ct. App. 2025). · cites it 2× “906(2) (now renumbered to Iowa Code § 489.806 (2)) provides, “If a derivative action .”
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