Confusion Over Charging Orders – Distributions Of Contributed Capital

A recent decision from the Ohio Court of Appeals held, inter alia, that a charging order did not extend to distributions from the LLC of contributed capital, saying those amounts are not "distributions."  Knollman-Wade Holdings, LLC v. Platinum Ridge Properties, LLC, No. 14AP-595, 2015 WL 1913565 (Ohio Ct. App. 10th Dist. April 28, 2015).  With due respect, this decision is incorrect.

Knollman-Wade Holdings ("KWH") held a judgment against against Platinum Ridge Properties ("PRP") for some $288,330.07.  Seeking to collect thereon, KWH sought a charging order against PRP's interest in Platinum Polaris partners, LLC ("PPI").  PRP objected to the tendered charging order, asserting that it went beyond the scope of the statute to include withdrawals of contributed capital.  The trial court entered the requested order, and this appeal followed.