Ropko v. McNeill, C.A. No. 2024-1193-PAF (Del. Ch. Mar. 16, 2026)
The Delaware Court of Chancery’s decision in Ropko v. McNeill, C.A. No. 2024-1193-PAF (Del. Ch. Mar. 16, 2026) addressed an important question in the context of limited liability company (LLC) governance disputes—namely, whether a voting agreement among co-managers of a Delaware LLC requiring that all managers vote “in the same manner” as the founder manager authorizes such founder manager to execute a written consent on behalf of the other managers. Following a trial, on March 16, 2026, the Court held that while a voting agreement may obligate its members to vote in a certain way, it does not grant any member the authority to act for another. In other words, the voting agreement was not a proxy to allow the founder to vote on behalf of the other managers; it is a distinction with a difference.
Background
The case involved McNeill Investment Group, LLC (MIG), a Delaware LLC governed by a managing board that was comprised of three members at the time of the events giving rise to the case. The managing board included Phillip McNeill, Jr. (McNeill), who was the company’s founder and largest equity holder. The other members were Christopher Ropko (Ropko) and Thomas Burdi (Burdi), who held their seats by virtue of being officers of MIG. All members of the managing board were parties to a June 21, 2023 voting agreement (Voting Agreement) that required Ropko and Burdi to vote “in the same manner” as McNeill in their capacities as managing board members.
The investment strategies of the managing board were not successful and MIG failed in its efforts to raise the investment amount it was seeking. The relationship of the board members deteriorated and McNeill concluded that in order to protect MIG’s long-term investors, he needed to remove Ropko and Burdi as officers and managing board members. In a phone call on October 7, 2024, McNeill told Ropko that he was removing Ropko and Burdi from their officer positions and from the managing board. McNeill then attempted to remove Ropko and Burdi unilaterally via a written consent of the managing board (Removal Consent). Only McNeill signed the Removal Consent, but he did so in his individual capacity and on behalf of Ropko and Burdi pursuant to the Voting Agreement. McNeill argued that because the Voting Agreement obligated Ropko and Burdi to vote in the same manner as McNeill, the Voting Agreement authorized him to execute the Removal Consent on their behalf. Ropko and Burdi brought suit in the Delaware Court of Chancery, challenging the validity of the removals. The Court held a two-day trial, followed by post-trial briefing and argument.
The Court of Chancery’s Analysis
The Vice Chancellor rejected McNeill’s theories that the removal of Ropko and Burdi was valid under either MIG’s operating agreement or the Voting Agreement. The Court found that MIG’s operating agreement was clear and unambiguous with respect to the removal of officers. The Court further held that since the operating agreement required the prior approval of the managing board to remove officers of MIG, Ropko and Burdi could only be removed from their officer positions by a majority vote of the members of the managing board.
The Court also held that the Voting Agreement did not authorize McNeill to sign on behalf of Ropko and Burdi. The Court clarified the distinction between a voting agreement and a proxy, noting that a proxy grants the authority to cast another’s votes, while a voting agreement is a contractual commitment governing how a party will exercise its voting rights.
McNeill’s argument conflated the two types of agreements. The Court held that the Voting Agreement did not grant McNeill the authority to cast votes or take any other action on behalf of Ropko and Burdi. Instead the Voting Agreement required them to vote consistently with McNeill’s position on matters coming before the managing board. Since McNeill did not have authority to sign the Removal Consent on behalf of Ropko and Burdi, the Removal Consent was ineffective because it was not signed by at least a majority of the managing board members. The Court concluded that Ropko and Burdi had not been validly removed and that they, therefore, remained in their positions as officers and members of the managing board of MIG.
Takeaways
Ropko v. McNeill reinforces the distinction between voting agreements and proxy agreements in the context of Delaware LLCs—namely, that voting agreements bind the signatories to vote in a certain way but do not authorize one signer to act for another. It is also a reminder of the foundational principle of Delaware LLC law that the plain language of an operating agreement will govern the rights of the members. The distinction between voting agreements and proxy agreements has practical implications. Controlling members of LLCs who wish to retain unilateral authority must ensure that such authority is expressly stated in the applicable agreement (whether through a proxy agreement or proxy clause, removal right, or similar provision in the operating agreement). A voting agreement will not grant unilateral authority unless effective proxy language is incorporated. Practitioners advising founders and investors on LLC formation documents should pay close attention to the difference between voting agreements and proxy grants and advise clients to adhere to the procedures included in such agreements and the operating agreement. Failing to include express removal authority, or failing to follow the applicable removal procedures, can render an attempted removal legally defective.