Sec. 101.461. PAYMENT OF EXPENSES. (a) In this section, "expenses" means reasonable expenses incurred by a party in a derivative proceeding, including:
(1) attorney's fees;
(2) costs in pursuing an investigation of the matter that was the subject of the derivative proceeding; or
(3) expenses for which the limited liability company may be required to indemnify another person.
(b) On termination of a derivative proceeding, the court may order:
(1) the limited liability company to pay expenses the plaintiff incurred in the proceeding if the court finds the proceeding has resulted in a substantial benefit to the limited liability company;
(2) the plaintiff to pay expenses the limited liability company or other defendant incurred in investigating and defending the proceeding if the court finds the proceeding has been instituted or maintained without reasonable cause or for an improper purpose; or
(3) a party to pay expenses incurred by another party relating to the filing of a pleading, motion, or other paper if the court finds the pleading, motion, or other paper:
(A) was not well grounded in fact after reasonable inquiry;
(B) was not warranted by existing law or a good faith argument for the application, extension, modification, or reversal of existing law; or
(C) was interposed for an improper purpose, such as to harass, cause unnecessary delay, or cause a needless increase in the cost of litigation.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 899 (H.B. 3603), Sec. 22, eff. September 1, 2019.
Structure Texas Statutes
Title 3 - Limited Liability Companies
Chapter 101 - Limited Liability Companies
Subchapter J. Derivative Proceedings
Section 101.452. Standing to Bring Proceeding
Section 101.454. Determination by Governing or Independent Persons
Section 101.455. Stay of Proceeding
Section 101.457. Tolling of Statute of Limitations
Section 101.458. Dismissal of Derivative Proceeding
Section 101.459. Allegations After Demand Rejected
Section 101.460. Discontinuance or Settlement
Section 101.461. Payment of Expenses
Section 101.462. Application to Foreign Limited Liability Companies