May 14, 2020

Master Limited Partnership

Master Limited Partnership

New Developments in Master Limited Partnership Governance
     John Goodgame,68(1): 81 - 102 (November 2012)
In February 2005, The Business Lawyer published an article describing the state of master limited partnership ("MLP") governance, which at that time had become relatively standardized. However, since that time, a number of MLPs have been formed or have restructured in ways significantly different from the previously standard MLP governance model. This article describes the changes that have occurred in the MLP marketplace and discusses these "new" MLP governance models.

The Case Against Fiduciary Entity Veil Piercing
     Mohsen Manesh; 72(1): 61-100 (Winter 2016/2017)
The doctrine of USACafes holds that whenever a business entity (a “fiduciary entity”) exercises control over and, therefore, stands in a fiduciary position to another business entity (the “beneficiary entity”), those persons exercising control, whether directly or indirectly, over the fiduciary entity (the “controller(s)”) owe a fiduciary duty to the beneficiary entity and its owners. Focusing on control as the defining element, courts have applied this far-reaching doctrine across all statutory business forms—including corporations, limited partnerships, and limited liability companies—and through successive tiers of parent-subsidiary entity structure to assign liability to the individuals who ultimately exercise control over an entity. In this respect, USACafes enables what two prominent business law jurists have aptly described as “a particularly odd pattern of routine veil piercing.”

This article argues that USACafes is a needless doctrine that stands in conflict with other, more fundamental precepts of law and equity. Accordingly, when presented with the opportunity, the courts of Delaware and other jurisdictions should reject its holding. Instead, the law ought to respect the fiduciary entity for what it is: a legal person separate and apart from its owners and controllers. If the limited liability veil of a fiduciary entity is to be pierced, then it should be under the more rigorous legal standard that courts have traditionally applied in veil-piercing cases.