Unreported / Non-Citable
Background
Ed Monce appealed an interlocutory temporary injunction obtained by Christopher Majka, Tressa Majka, and Esplanade Investments, LLC in litigation involving IM Home Companies LLC (IMH). The appellees alleged, among other claims, that IMH defaulted on $2 million in loans guaranteed by Monce and that they had been excluded from IMH’s operations and financial information.
The injunction incorporated restrictions associated with purported IMH resolutions dated June 28, 2024, and January 2, 2025. It required access to employees, weekly reports, and financial and accounting data; prohibited company credit-card use; and restricted transactions exceeding $5,000, real-property transactions, and encumbrances unless approved by a majority of IMH members or managers. Although Monce, Tressa, and John Thomas had signed IMH operating agreements as managers, evidence showed that Thomas resigned as a manager on November 6, 2024, leaving Monce and Tressa as the only managers when the injunction hearings occurred.
The Court’s Holding
The court reversed four portions of the injunction because the evidence did not establish that the January 2, 2025 resolution had received the required “Member Majority Vote” under either a one-member-one-vote or proportional voting scheme. Nor was there evidence that the resolution’s framework had previously governed IMH. The trial court therefore lacked a sufficient basis to enjoin Monce from limiting members’ access to employees, weekly reports, bank and accounting data, or from using IMH credit or debit cards.
The court affirmed the remaining restrictions. Both operating agreements gave managers broad authority but required agreement among multiple managers, and the evidence showed that Monce and Tressa were IMH’s only managers at the relevant hearings. Because unilateral action by Monce would interfere with Tressa’s management rights—an injury not readily measurable in money—the trial court could restrict expenditures over $5,000, real-property purchases or sales, diversion of opportunities, and encumbrances undertaken without the required approval.
The court also held that Monce’s testimony supplied some evidence supporting the appellees’ probable right to relief on their pleaded breach-of-contract claim involving his guaranty of the $2 million loan. A later nunc pro tunc order properly cured the original injunction’s failure to specify a trial date, and the injunction did not improperly award ultimate relief because it granted neither the damages nor the declaratory relief requested in the petition. The court remanded for entry of a revised temporary injunction.
Key Takeaways
- A trial court may correct a temporary injunction’s omission of a specific trial date through a later order while an interlocutory appeal is pending.
- An injunction could not enforce the proposed January 2025 governance rules without evidence that the resolution passed under the operating agreements or reflected the preexisting status quo.
- Interference with an LLC manager’s contractual participation rights may constitute irreparable injury supporting temporary injunctive relief.
Why It Matters
The decision illustrates that temporary injunctions in LLC disputes must track proven governance rights and the actual pre-dispute status quo. Courts may protect a manager from unilateral action by another manager, but they may not temporarily impose disputed internal rules that the evidence does not show were validly adopted or previously followed.
It also confirms that appellate courts may sever unsupported provisions while preserving portions of an injunction independently supported by the operating agreement and the evidentiary record.