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Can an LLC in Utah prevent its Members from using smart

Richard,Can an LLC in Utah...
Richard,Can an LLC in Utah prevent its Members from using smart phones to record the conversation during private Member-only business meetings (where things like trade secrets, private customer/vendor data, and financial information will be discussed)?
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Answered in 21 minutes by:
8/15/2017
Roy Hadavi
Category: Business Law
Satisfied Customers: 989
Experience: Attorney at Law Offices of Rosenstein & Associates
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Hi Richard. My name is ***** ***** I am a licensed attorney. I would be happy to provide assistance. Please give me a moment to formulate a response.

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What is the purpose of preventing them from recording the conversations?

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Customer reply replied 4 months ago
Roy,Thanks for following up. The purpose is to ensure that all trade secrets, private customer/vendor data, and financial information will remain private.The Members discussed the topic and the vast majority also feel more comfortable having open discussions if there is not a recording device being used to record our private meetings. Before we create a policy to prevent the use of recording devices in meetings, we want to make sure that it is legal to do so.

You are very welcome. It is absolutely legal to do so and will be especially easy to have the Board vote on such a policy, since you have indicated that a majority are in favor.

In addition, I would highly recommend having all members sign a Non-Disclosure Agreement (NDA) to ensure the confidentiality of all these materials.

Lastly, I would also recommend stamping all proprietary, confidential and trade secret as such, to ensure their protection.

All of these steps will keep your company's information secure from disclosure.

I have done my best to provide information which fully addresses your question. If you have any follow-up or clarification questions, please ask! There is no additional fee. If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service as Good or Excellent (i.e., 4 or 5 stars)(hopefully Excellent/5 stars!). Otherwise, I receive no credit for assisting you today. I thank you in advance for taking the time to provide me a positive rating!

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Customer reply replied 4 months ago
Roy,The reason for asking this question is because one Member plainly stated that we do not have a legal right to prevent him/her from recording during our meetings because he/she is a party to the conversation.After the vote has passed, how can I prevent that individual from continuing to record the meetings?Also, the NDA is a wonderful idea, and would be a great supplement to our OA.

The member is correct, in that in general he may record the conversation. However, the LLC has the right to institute a policy preventing the recording of conversations and such policy would override the legal right of the member.

Also, the NDA would bar him from ever using such information for anything other than personal/private use.

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Customer reply replied 4 months ago
Roy,You missed the last part of the questions:After the vote has passed, how can I prevent that individual from continuing to record the meetings?

My apologies.

I would include in the policy/vote that any violation would first receive a warning from the Board and after a first violation, the member could either:

  1. Be bought out by the other members and/or the LLC; or
  2. Have his membership interest converted into a non-voting interest without the right to attend Board meetings.

That should be sufficient incentive for him to comply.

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Customer reply replied 4 months ago
Thank you very much. I'll give you 5 stars :).

You're very welcome.
Thank you so much for the 5-star rating! I know rating takes an additional step and I truly appreciate you taking the extra time! It's been my honor and privilege to help you with this. If I can help you in any way in the future, I'll be happy to help. For easy access, my bookmark is: https://www.justanswer.com/law/expert-royhadavi/ Or, simply request “Roy only” in the first line of your question.

Roy Hadavi
Category: Business Law
Satisfied Customers: 989
Experience: Attorney at Law Offices of Rosenstein & Associates
Verified
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