Fiduciary Duties And Private Equity LPAs: What Have Courts Said?

Overview

In our previous bulletins, we explored two interrelated questions. First, the fiduciary duties owed by general partners (GPs) and their directors to limited partners (LPs) within a PE fund. Second, when LPs may be able to bring a derivative action on behalf of the limited partnership against the corporate GP and/or the GP's directors for a breach of such fiduciary duties.

We conclude our three-part series on fiduciary duties in the private equity context with the corresponding question of whether the terms of the PE fund's limited partnership agreement (LPA) can impact either (1) the right of the LPs to bring such a derivative action, or (2) the scope of the fiduciary duties owed by the GP to the limited partnership.