Johnson v. CrossettAnnotate this Case
This case arose out of an oral agreement between David Crossett (“Crossett”) and David Johnson (“Johnson”) to form a limited liability company (“LLC”). After Crossett formed the LLC, Johnson backed out by refusing to sign the written operating agreement. Crossett remained as the sole member of the LLC, which he eventually sold. Johnson and Tessa Cousins (“Cousins”), the LLC’s only employee, filed a complaint against Crossett, wherein they asserted, amongst other things, that: (1) they were members of the LLC since its inception; and (2) Crossett had breached his fiduciary duties. The district court dismissed the case after concluding that Johnson and Cousins were never members of the LLC because they had refused to sign the written operating agreement. Finding no reversible error, the Idaho Supreme Court affirmed the district court’s judgment.