Delaware Court of Chancery Upholds LLC Members’ Waiver of Statutory Rights to Inspect Company Books and Records

By: Tyler O'Connell 

In Bengson v. Elevate RCM Holdings, LLC, C.A. No. 2025-1347-DG, 2026 WL 2409798 (Del. Ch. Aug. 10, 2026), the Delaware Court of Chancery held in a post-trial decision that, under the governing limited liability company agreement, plaintiff limited liability company members waived their default statutory rights under 6 Del. C. § 18-305 to inspect the company’s books and records.

The members were sellers of a business whose consideration included membership interests in the acquirer’s LLC. The governing LLC agreement provided clearly that members agreed to waive any inspection rights under Section 305 of the Delaware LLC Act. Magistrate Judge Danielle Gibbs reasoned that the Delaware LLC Act does not prohibit waiver of statutory inspection rights via a clear LLC agreement provision. 

The Court explained that “[b]arring sufficient public policy concerns or express statutory language prohibiting a waiver, sophisticated parties may contractually waive a statutory right in exchange for valuable consideration.” The Court cited Manti Hldgs., LLC v. Authentix Acq. Co., Inc., 261 A.3d 1199, 1219–21 (Del. 2021), in which the Delaware Supreme Court upheld a waiver of statutory appraisal rights in a stockholders’ agreement. 

The Court further reasoned that the express policy of the LLC Act is to “give the maximum effect to the principle of freedom of contract and to the enforceability of limited liability company [operating] agreements.” 6 Del. C. § 18-1101(b). The Court explained, “For such a waiver to be enforceable, it must be clear and unequivocal, and the waiving party must know of the requirement or condition they are agreeing to waive.”

Originally published by the American Bar Association, Business Law Section in August 2026 issue of Business Law Today.