Joint Ventures, Limited Liability Companies and Partnerships
Joint ventures, commonly conducted in the form of limited liability companies or limited
partnerships, can be among the most complex of business relationships to structure and document. The
difficulty lies at the very nature of the relationship among the parties itself, tantamount to a marriage.
Parties to a joint venture initially are commonly enamored with the efficiencies and synergies that they
may realize from such an alliance, yet the complexities of business relationships and the issues that frequently
arise in the conduct of the venture could and do cause fractures amongst co-venturers. Accordingly, joint
ventures suffer one of the highest failure rates among all forms of business transactions. On the other hand,
there are many successful joint ventures, and nearly all large corporations are involved in some form
of joint venture or strategic alliance relationship.
Integral in the structuring of joint ventures is the ability to segregate the proposed venture into
its core components to enable the identification of the key elements of each that need to be analyzed and
addressed in the negotiation and documentation of the venture. Attorney Lindley has the experience,
knowledge and understanding of the principles of limited liability company law and partnership law, the
entities in which many joint ventures and strategic alliances are conducted, to negotiate, structure and
draft limited liability company operating agreements and limited partnership agreements, as well
as facility with the federal income tax law, finance and accounting principles commonly applicable
to such enterprises.
In the context of joint ventures, three terms are commonly referred to analogously – joint venture,
partnership and strategic alliance. Black’s Law Dictionary defines those terms:
“Partnership. A voluntary association of two or more persons who jointly own and carry on a business for
profit. “Under the Uniform Partnership Act, a partnership is presumed to exist of the persons agree to share
proportionally the business’s profits and losses.. Cf. JOINT VENTURE; STRATEGIC ALLIANCE.”
“Joint venture. A business undertaking by two or more persons engaged in a single defined project. “The
necessary elements are: (1) an express or implied agreement; (2) a common purpose that the group intends
to carry out; (3) shared profits and losses; and (4) each member’s equal voice in controlling the project.
Also termed joint adventure; joint enterprise. Cf. PARTNERSHIP; STRATEGIC ALLIANCE.
“Strategic alliance. A coalition formed by two or more persons in the same or complementary businesses
to gain long-term financial, operational and marketing advantages without jeopardizing competitive
independence through their strategic alliance, the manufacturer and distributor of a codeveloped product
shared development costs. Cf. JOINT VENTURE; PARTNERSHIP.
Should you be contemplating a possible joint venture as a business solution, please contact the firm for a
free consultation regarding the benefits and burdens associated with this form of business model.
1. Black’s Law Dictionary, Eighth Edition, 2004