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`IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
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`RIVERBEND PEGP LLC and
`ZACH MURPHY, in his capacity
`as co-manager of 1000 River
`Bend Dr Manager LLC
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` Plaintiffs,
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`TRION INVESTOR LLC and
`MAX SHARKANSKY, in his
`capacity as co-manager of 1000
`River Bend Dr Manager LLC
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` Defendants,
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`C.A. No. 2025-
`VERIFIED COMPLAINT FOR
`BREACH OF CONTRACT AND SPECIFIC PERFORMANCE
` Plaintiffs Riverbend PEGP LLC (“RPEGP”) and Za ch Murphy (“Mr.
`Murphy”) (together, the “Plaintiffs”) respect fully file this Verified Complaint for
`Breach of Contract and Specific Performance . Plaintiffs allege the following on
`information and belief, except as to allegations regard ing their own actions which
`are based upon personal knowledge.
`NATURE OF THE CASE
`1. Mr. Murphy and defendant Max Sh arkansky (“Mr. Sharkansky”) are
`equal co-managers of 1000 River Bend Dr Manager LLC (the “Company”), an entity
`responsible for managing a large multi-family apartment complex project located at
`1000 River Bend Drive in Lancaster, Texas (t he “Project”) and related investment
`EFiled: Sep 05 2025 01:42PM EDT
`Transaction ID 77007647
`Case No. 2025-1010-
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`vehicles that comprise the ownership of th e Project. At least, they are supposed to
`be.
`2. Since the Project was acquired in October of 2023, Mr. Sharkansky has
`taken, or has caused to be taken, improper and numer ous unilateral actions that far
`exceed his authority as a co-manager of the Company, breached express provisions
`of the Company’s LLCA (defined below), and disenfranchised Mr. Murphy’s rights
`as an equal co-manager. These actions include, among other examples, unilaterally
`making decisions and entering contracts in connection with construction activities
`taking place at the Project; unilaterally ob taining member loans without disclosing
`them; unilaterally making at least three draws under the Project’s secured loan
`facility without Mr. Murphy’s prior knowledge; losing title to a portion of the Project
`through a Constable’s sale and then re acquiring the same without disclosing
`anything until Mr. Murphy discovered transfer deeds in the property records on his
`own; and unilaterally initiating a capital ca ll without the prior approval of Mr.
`Murphy.
`3. Mr. Sharkansky has also failed to co mply with contractual fiduciary
`duties that are expressly provided for by the Company’s LLCA, including a duty to
`conduct himself “in a diligent and professional manner” and to refrain from conduct
`amounting to gross negligence, intentional or reckless conduct, fraud, bad faith, or a
`material breach of the Company’s LLCA. For example, Mr. Sharkansky has failed
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`to timely provide Mr. Murphy and RPEGP w ith copies of correspondence that he
`received from the Company’s secured lender regarding certain alleged loan defaults
`and reservations of rights.
`4. As a consequence of these unila teral actions, failures, and Mr.
`Sharkansky’s continued refusal to include Mr. Murphy in management decisions, the
`Plaintiffs: (i) assert breaches of provisions of the Company’s LLCA and contractual
`fiduciary duties expressly im posed thereby; (ii) seek specific performance of the
`management provisions of the Company’s LLCA and the removal of Mr. Sharkansky
`as a co-manager for cause; and (iii) seek such other relief as justice and equity
`demand.
`PARTIES
`5. Plaintiff RPEGP is a Delaware lim ited liability company. RPEGP is
`one of two members that own 100% of the membership interests of the Company,
`with RPEGP owning 33.33% of the membership interests and Trion (defined below)
`owning the other 66.70% of the membership interests.
`6. Plaintiff Mr. Murphy is an individual residing in the State of Texas. Mr.
`Murphy was designated by RPEGP to serve as one of the two co-managers of the
`Company.
`7. Defendant Trion Investor LLC (“Trion”) is a California limited liability
`company. Trion is one of two members that own 100% of the membership interests
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`of the Company, with Trion owning 66.70% of the membership interests and RPEGP
`owning the other 33.33% of the membership interests.
`8. Defendant Mr. Sharkansky is an individual residing in the State of
`California and/or the State of Florida. Mr. Sharkansky was designated by Trion to
`serve as one of the two co-managers of the Company.
`JURISDICTION AND VENUE
`9. The Court has jurisdiction over this matter under 6 Del. C. §§ 18-110
`and 18-111 because it involve s contested matters relati ng to the removal of a
`manager of a Delaware limited liability company and the interpretation, application,
`and enforcement of the provisions of a Delaware limited liability company
`agreement.
`10. Furthermore, the Company’s LLCA specifically provides that all
`litigation arising out of the LLCA shall be conducted in the state or Federal courts
`located in the State of Delaware and that such courts shall have the exclusive
`jurisdiction to hear and decide such matters. LLCA, § 11.6.
`11. The members of the Comp any also expressly submitted themselves to
`the personal jurisdiction of such courts a nd waived any objection to venue or that
`such courts are an inconvenient forum. Id.
`12. As co-managers of the Company, Murphy and Sharkansky are subject
`to the Court’s jurisdiction as well under 6 Del. C. § 18-109.
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`FACTUAL BACKGROUND
`A. The River Bend Apartments Project
`13. In or about October of 2023, Tri on and RPEGP, and certain other
`investors, closed on a transaction to acquire the Project from its prior owners.
`14. The Project is generally described as a multi-family apartment complex
`located at 1000 River Bend Drive, Lancaster TX 75146. It is comprised of
`approximately 471 units and occupancy is presently in excess of 90%.
`15. The Project was referred to as the Riverbend Apartments, but is now
`known as the Laurel Grove Apartments.
`16. The Project is owned under a tena nts-in-common structure by two
`wholly-owned single purpose entities unde r a Tenants-in-Common Agreement,
`dated October 13, 2023 (the “TIC Agreement”).
`17. One of the two tenant-in-comm on owners is 1000 River Bend Dr
`Property, LLC (“TIC 1”), a Delaware limited liability company. It owns
`approximately 96.92% of the Project.
`18. The other tenant-in-common owne r is 1000 River Bend Dr Property
`TIC 2, LLC (“TIC 2”, and together with TIC 1, the “PropCos”), a Delaware limited
`liability company. It owns the remaining 3.08% of the Project.
`19. The PropCos are each in turn wholly-owned by single purpose holding
`companies (the “HoldCos”): (i) TIC 1 is owned 100% by 1000 River Bend Dr.
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`Investor, LLC (“Investor Holdco”), a Dela ware limited liability company; and (ii)
`TIC 2 is owned 100% by Continental Ri verbend Holdings, LLC (“Continental
`Holdco”), a Delaware limited liability company.
`20. The governance documents for the PropCos provide that they are to be
`managed by their respective owners – the HoldCos.
`21. The governance documents for the HoldCos provide that they are to be
`managed by the Company as manager.
`22. Pursuant to the terms of the I nvestor Holdco’s Limited Liability
`Company Agreement (the “Investor Holdco LLCA”), Investor Holdco acts through
`the Company as its manager. See Investor Holdco LLCA § 5.1 (“The business,
`property and affairs of [Investor Holdco] shall be managed excl usively and solely
`by the Manager.”). A true and correct copy of the Investor Holdco LLCA is attached
`hereto as Exhibit A.
`23. Additionally, the Company, as mana ger of Investor Holdco, has the
`authority under the terms of the Investor Holdco LLCA to make a capital call. See
`Investor Holdco LLCA § 3.2. (“If the Ma nager determines at any time that the
`Company requires additional cash in order to pay when due the obligations . . . the
`Manager shall furnish written notice to each Class A Member of the amount(s) and
`date(s) on which such additional capital contributions. . . are required.”)
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`24. The Company is also the manager for the Project itself under that
`certain Management Agre ement, dated October 13, 2023 (the “Management
`Agreement”).
`25. Accordingly, the Company is respons ible for the management of the
`entirety of the Project, the PropCos, and the HoldCos.
`B. The Mortgage Loan Encumbering the Project
`26. The acquisition of the Project in October of 2023 also involved a
`refinancing of existing debt on the property in order to secure necessary funding to
`finance the purchase and maintenance of the Project and also to make certain
`renovations and repairs.
`27. To memorialize the loan, the PropCos and First-Citizens Bank & Trust
`Company (the “Lender”) entered into that certain Loan Agreement, dated as of
`October 13, 2023 (as am ended, supplemented, or othe rwise modified from time to
`time, the “Loan Agreement”), pursuant to which Lender agreed to make a loan to the
`PropCos in the original principal amount of $40,169,922.00 (the “Loan”).
`28. The Loan is also evidenced by a Promissory Note in the original
`principal amount of $40,169,922.00 (the “Note”).
`29. The Loan is secured by that certain Deed of Trust, Assignment of
`Leases and Rents, Security Agreement and Fixture Filing on the Project, guaranteed
`by Mr. Sharkansky individually and as trustee of The Max Sharkansky Living Trust,
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`Mr. Mitch Paskhover individually and a trustee of the Mitch Paskhover Living Trust,
`and Trion Multifamily Opportunity Fund IV , LLC pursuant to a Guaranty dated
`October 13, 2023, and subject to other loan documentation.
`30. At present, the Loan is alleged to be in default, which has prevented the
`borrowers from drawing on certain reserve funds needed to pay for ongoing
`construction and renovations.
`C. The Ownership and Management of the Company
`31. The Company is owned by Tri on and RPEGP and governed by a
`Limited Liability Company Agreement dated October 13, 2023 (the “LLCA”), a true
`and correct copy of which is attached hereto as Exhibit B.
`32. As set forth in the LLCA, Trion owns 66.7% of the Company’s
`membership interests and RPEGP owns the remaining 33.33%.
`33. The business and affairs of the Co mpany are required to be managed
`under the direction of the Managers (as defined therein). LLCA, § 6.1(a)(i).
`34. The Company is required to have two Managers – one appointed by
`RPEGP and the other appointed by Trion. Id., § 6.1(b).
`35. RPEGP appointed Mr. Murphy to serve as one of the Managers, and
`Trion appointed Mr. Sharkansky as the other Manager. Id.
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`36. These two equal co-managers are e ach entitled to one vote and their
`unanimous consent is needed to constitute the act of the Managers and the Company.
`Id., § 6.1(f).
`37. Except as required by applicable law and except as explicitly set forth
`in the LLCA or as authorized in wr iting by the Managers, the members of the
`Company are not permitted to participate in any aspect of the management or control
`of the Company’s business or transact a ny business for the Company or have any
`power to act for or bind the Company. Id., §§ 6.1(a)(ii) and 6.4. All such powers
`are “vested solely and exclusively in the Managers.” Id., § 6.4.
`38. Among other things, the Managers, us ing their reasonable discretion,
`have the express authority to do all things necessary or convenient to carry out the
`business and affairs of the Company and each “River Bend Co mpany” (i.e., the
`PropCos and HoldCos), including, among other things, borrowing money,
`expending capital and revenue s of the Company or a River Bend Company, enter
`into and execute agreements, and a litany of other specific matters. Id., § 6.1(a)(iii).
`39. The Managers, working together, al so have the discretion to obtain
`loans on behalf of the Company or any River Bend Company from the members or
`any of their affiliates. Id., § 3.6.
`40. Indeed, throughout Article 6 of the LLCA (which governs the powers,
`rights and duties of the Managers and the Members), the provisions are consistent in
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`terms of all authority residing in the “Manag ers” – plural – with the exception that
`RPEGP’s Manager (Mr. Murphy) “sha ll have unilateral authority over
`administration of the Letter Agreement (defined therein).” Id., § 6.1(f).
`41. The Letter Agreement means that certain Letter Agreement dated as of
`October 13, 2023, by and among Trion, RP EGP, and the Company, which deals
`generally with the allocation of certain membership interests between members and
`related distribution matters.
`42. There is no provision anywhere in the LLCA giving Mr. Sharkansky
`unilateral authority to act on behalf of the Company.
`43. Furthermore, RPEGP has never waived or agreed to modify any of its
`rights to have its designated Manager act as an equal co-m anager of the Company.
`Any purported amendment or waiver of any express provision in the LLCA can only
`be accomplished by the written agreement of all members of the Company. Id., §
`10.1. There is no such written agreement.
`44. Pursuant to the LLCA, the Managers have no fiduciary or other duties
`to the Company, any other Member or to any third party, and “the Managers’ sole
`obligations and responsibilities shall be as e xpressly set forth in this Agreement.”
`Id., § 6.1(i).
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`45. The LLCA expressly provides that the Managers sha ll perform their
`duties and carry out their management responsibilities “in a diligent and professional
`manner.” Id., § 6.3(a).
`46. The LLCA also expressly provides that the Managers shall not be liable,
`responsible or accountable, in damages or otherwise, to any Member or to the
`Company for any actions within the scope of their authority “ except for gross
`negligence, intentional or reckless conduct, fraud, bad faith or a material breach of
`this Agreement.” Id., § 6.5(b) (emphasis added).
`D. Mr. Murphy begins to discover one act after another that Trion and Mr.
`Sharkansky took unilaterally without Mr. Murphy’s knowledge or
`consent in violation of the LLCA’s express governance provisions.
`47. Since closing the transaction, Mr. Murphy has di scovered various
`actions taken by Trion and Mr. Sharkans ky without Mr. Murphy’s knowledge or
`consent, or significant events affecting the Project that Mr. Sharkansky simply failed
`to disclose to Mr. Murphy.
`Three Undisclosed Loan Draws
`48. For example, on or about March 13, 2024, Mr. Sharkansky emailed Mr.
`Murphy to say that Trion was processing its “first draw” under the Loan for the
`Project and the Lender was requesting Mr . Murphy’s signature per the loan
`documents. Mr. Murphy asked to see the supporting backup documents for the
`construction projects that needed to be pa id out of the draw. Trion responded with
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`an email that provided copies of contract s for three projects, but noted that the
`funding was actually for “Draw #4.” Mr. Sharkansky followed up that message with
`his own email that said: “My mistake. It’s the fourth draw, not the first.”
`49. Hearing that there had been three prior draws from the Lender that were
`done without his knowledge, Mr. Murphy emailed back on March 22, 2024: “If this
`is the 4th draw, I’m concerned that this is the first I’ve heard of it. Can you help me
`understand that piece?” To which Mr. Sharkansky replied: “We discussed copying
`you on the submission moving forward.”
`50. On April 3, 2024, Mr. Murphy sent an email to Mr. Sharkansky and
`Trion emphasizing his disappointment with being kept in the dark on draw requests
`and reaffirming that he was an equal co-manager and needed to be involved in all
`major decisions going forward. Specifically, his email stated, in relevant part:
`We can talk in more detail at a later time, but I want to be
`clear that our Co-GP Agreement requires that we mutually
`agree on decisions such as major contracts and you do not
`have unilateral authority to enter them without my
`consent. You did exactly that, which is extremely
`disappointing and in direct contravention to our
`agreement.
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`At this point, given the extensive work that is already done
`and the substantial payments that have already gone out, I
`feel it would be detrimental to the project to withhold
`consent for this 4th draw/payment. However, I will require
`a detailed inspection and review of the work completed by
`my contractor, at the expe nse of TRION, prior to
`approving any further payments, and reserve the right to
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`renegotiate any part of the contract with the vendor we
`deem necessary.
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`Going forward, we fully be lieve and understand that you
`will be abiding by our JV A and your responsibilities under
`it and expect to be fully informed and included in any and
`all contracts or expenditures at the project. I view this
`initial bump as a growing pain of our first investment
`together and look forward to a successful and beneficial
`relationship going forward.
`Undisclosed Construction Contracts and Work at the Project
`51. Notwithstanding that “initial bump” and Mr. Murphy’s insistence on
`requiring his consent, Mr. Sharkansky c ontinued to act unila terally on significant
`Project decisions, contracts, and other ma tters, with Mr. Murphy finding out things
`after the fact.
`52. Pursuant to the Loan Agreement, certain life and safety repairs needed
`to be undertaken at the Project, as well as renovations to certain units, which were
`to be funded out of reserves established as part of the Loan.
`53. Mr. Sharkansky and Trion initially wanted to use a general contractor
`that Mr. Sharkansky went “way back” with – Mike Rovner Construction (“MRC”).
`In April of 2024, Mr. Sharkansky let Mr. Murphy know about his desire to use MRC,
`and Mr. Murphy was open to it but also suggested another construction company he
`had used in the past – Build 365 Construc tion (“Build 365”). Trion solicited bids
`for the work from both MRC and Build 365, and ultimately decided to go with Build
`365.
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`54. However, Mr. Murphy later learned that Trion had entered into a formal
`$1.2 million general contracting agreem ent for the construction without Mr.
`Murphy’s knowledge. In the late fall of 2024, Mr. Murphy visited the Project site
`only to see construction projects in full swing without his knowledge. He also began
`learning about a growing pile of mechanic ’s lien claims being filed by contractors
`and vendors who were owed money for construction work on the Project.
`55. Mr. Sharkansky and Trion had simply moved forward unilaterally with
`significant construction work without Mr. Murphy’s knowledge or approval.
`Undisclosed Member Loans by Trion in Excess of $2.1 Million
`56. Towards the end of 2024, Mr. Murphy also became aware that Mr.
`Sharkansky had obtained member loans from Trion without Mr. Murphy’s prior
`knowledge or approval in orde r to pay for some of the construction costs at the
`Project.
`57. The ability to obtain member loans is a matter subject to the discretion
`of both Managers under Section 3.6 of the LLCA, but Mr. Murphy had not been
`consulted and these member loans from Tri on were not disclose d anywhere in the
`monthly financial reporting that Mr. Murphy had been receiving at the time.
`58. After discussing the member loans with Trion post-facto, Mr. Murphy
`suggested that if Trion wanted to contribute capital to cover construction costs, they
`might consider doing so under Section 3.2.2 of the limited liability company
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`agreement for Investor HoldCo, which pe rmits Trion and RPEGP to contribute
`capital to cover cost overruns from the cons truction without issuing a capital call.
`Mr. Murphy suggested he would be open to Trion contributing up to $1 million in
`this manner on an interest free basis provi ded that it would subordinate to all the
`equity in the deal.
`59. Thereafter, the monthly financing reporting to investors began to
`include balance sheets from Trion with a new line item under Current Liabilities for
`“Due To-From Related Party.” No further information was disclosed as to whether
`that was with respect to member loans, contributions under Section 3.2.2, or
`something else, but the balance of this vague liability line item increased to over $2
`million as the months went by.
`60. The increase in member loan liabilities clearly means that Trion
`continued to make member loans to the Project, but Mr. Sharkansky failed to consult
`or obtain approval from Mr. Murphy for a ny of the specific member loans or for
`authorization to continue making loans to the Project in excess of the $1 million
`previously discussed. Mr. Murphy was seeing the line item for the member loans on
`the balance sheet go up, but was being kept in the dark as to any details on specific
`loans being made, despite his role as an equal co-manager.
`61. Indeed, Trion recently disclosed to Mr. Murphy that it had infused
`$2,118,500 in member loans to the Project, which purport to accrue interest at the
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`rate of 6.3%. There has been no transparen cy into any of these member loans, and
`no disclosure to Mr. Murphy as to when th ese loans were being made and what the
`loan proceeds were being used for specifically.
`62. Mr. Sharkansky and Trion acted unilaterally in obtaining member loans
`from Trion without Mr. Murphy’s approval or prior knowledge as a co-Manager.
`Mr. Murphy Discovers the Project was Sold Through a
`Constable’s Sale and Then Subsequently Reacquired
`63. In or about June of 2025, it was brought to Mr. Murphy’s attention that
`two property transfer deeds appeared of record in the property records of Dallas
`County, Texas that were previously unknown to Mr. Murphy.
`64. Specifically, a Constable’s Deed ha d been recorded on January 15,
`2025, pursuant to which the Constable for Dallas County, Texas purported to transfer
`all right, title and interest of TIC 2 in the Project to a bidder at a Constable’s auction
`for a nominal bid of just $12,100. Then, on April 9, 2025, a Special Warranty Deed
`was recorded purporting to reconvey that same interest back to TIC 2.
`65. Mr. Murphy had no prior knowledge of these transfers and neither Mr.
`Sharkansky nor Trion provided any disclosure about what transpired.
`66. Upon further investigation, Mr. Mu rphy discovered the transfers were
`the result of a default judgment that had been obtained by a plaintiff in a small claims
`lawsuit that had been commenced against the PropCos in the Justice of the Peace
`Court in Dallas County, Texas, in July of 2024. A default judgment was entered for
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`less than $6,000. The Constable levied on the property, sold it at auction in
`December of 2024, and recorded the Constable’s Deed on January 15, 2025.
`67. At some point, Trion became aware of the property transfer at the
`Constable’s sale and engaged with the purported transf eree and negotiated for the
`return of the property back to TIC 2, wh ich resulted in the filing of the Special
`Warranty Deed in April of 2025.
`68. Trion failed to disclose any of th is to Mr. Murphy until Mr. Murphy
`specifically inquired in July of 2025, having independently learned of the recording
`of the two deeds.
`Unapproved Capital Call
`69. On or about July 11, 2025, Mr. Mu rphy received an email from Trion
`Properties, Inc. purporting to make a capita l call on behalf of Investor HoldCo and
`asking for funds to be contributed by Ju ly 25, 2025. The capital call email was
`accompanied by materials prepared by Trion Properties that disclosed that “Trion”
`was issuing the capital call in respect of the Project in order to pay for certain
`accounts payable that had accrued.
`70. The capital call was also being made in connection with efforts by Mr.
`Sharkansky and Trion to obtain refinancing for the current Loan.
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`71. Mr. Murphy was never asked to revi ew any of the materials for the
`purported capital call and did not give his au thorization as a co-Manager to initiate
`the capital call.
`72. On July 23, 2025, Mr. Murphy sent a notice to Mr. Sharkansky formally
`objecting to the capital call because it had been undertaken without his approval in
`violation of his rights under the LLCA as a co-Manager. A true and correct copy of
`that notice is attached hereto as Exhibit C.
`Undisclosed Lender Correspondence Concerning Alleged Defaults
`73. On or about June 11, 2025, Lender, as administrative agent on the Loan,
`sent a letter (the “First De fault Letter”) to the two PropCos as borrowers (to the
`attention of Mr. Sharkansky and Mr. Paskhover) and to the guarantors for the Loan
`– Mr. Sharkansky, Mr. Paskhover, and Trion Multifamily Opportunity Fund IV , LLC
`(also to the attention of Messrs. Sharkansky and Paskhover). A true and correct copy
`of the First Default Letter is attached hereto as Exhibit D.
`74. The First Default Letter gave notice that a certain lien affidavit had been
`recorded against the Project resulting in an alleged breach of Section 6.14 of the
`Loan Agreement and an Event of Defa ult under Section 7.1(e) of the Loan
`Agreement.
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`75. The First Default Letter also gave notice of two other circumstances
`that would constitute an Event of Defau lt under the Loan Agreement if not cured
`within ten days of receiving the First Default Letter.
`76. Mr. Sharkansky failed to provide a copy of the First Default Letter to
`Mr. Murphy when it was received and faile d to let Mr. Murphy know that a formal
`default letter had even been received from the Lender.
`77. Instead, Mr. Sharkansky told Mr. Murphy generally that the Lender
`believed certain defaults ex isted, but was apparently not planning on taking any
`action based on the alleged de faults for the time being. There was no mention of
`receiving a default letter.
`78. Even more concerning, when Mr. Sharkansky had received the formal
`First Default Letter from the Lender, he had previously received a formal books and
`records demand from Mr. Murphy’s legal c ounsel dated December 6, 2024. The
`books and records demand raised Mr. Murphy’s concerns with Mr. Sharkansky’s
`pattern of unauthorized un ilateral management actions and demanded that Mr.
`Sharkansky turnover certain books and r ecords of the Company to Mr. Murphy,
`including, among other things: “All doc uments, including emails involving
`managers, regarding any loan s, convertible notes, debent ures, or other forms of
`indebtedness involving the Company.” Despite having received this prior books and
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`records demand, Mr. Sharkansky still failed to provide Mr. Murphy with the First
`Default Letter when it was received.
`79. It was not until August 26, 2025, when Mr. Murphy learned for the first
`time during a phone call with the Lender that a formal First Default Letter had been
`sent. Mr. Sharkansky had sat on this info rmation and failed to disclose it to Mr.
`Murphy for over two months.
`80. The following day, August 27, 2025, the Lender delivered a formal
`Notice of Demand to Cure Events of Defa ult (the “Second Default Letter”), a true
`and correct copy of which is attached here to as Exhibit E. This time, Mr. Murphy
`was copied on the communication in an email sent by the Lender.
`81. The Second Default Letter gave notic e that the prior circumstances
`identified in the First Default Letter had not been cured and now constituted Events
`of Default under the Loan Agreement. In addition, the letter identified a second
`alleged Event of Default relating to a lien affidavit that was recorded by MRC
`against the Project after the Lender had se nt the First Default Letter. The Second
`Default Letter advised that if the outstanding alleged defaults were not cured by
`August 29, 2025, the Loan would be accelerated and amounts due will bear interest
`at a default rate of interest.
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`82. On August 29, 2025, the Lender sent a formal Notice of Acceleration
`and Demand for Payment in respect of the Loan, a true and correct copy of which is
`attached hereto as Exhibit F.
`E. Mr. Sharkansky’s and Trion’s Mismanagement of the Project.
`83. In addition to all of the unilateral unauthorized actions described above
`taken by Mr. Sharkansky in violation of the LLCA and in derogation of Mr.
`Murphy’s right as an equal co-manager, Mr. Sharkansky mismanaged the Project in
`other ways as well.
`84. Mr. Sharkansky and Trion failed to act in accordance with
`commercially reasonable standards in payi ng vendors, causing harm to the Project.
`For example, in or about the summer of 2024, Mr. Sharkansky and Trion hired Stone
`Crete LLC to repair a retaining wall at the Project. Mr. Sharkansky and Trion wired
`approximately $100,000 of project funds direc tly to an individual who purportedly
`worked with that vendor rather than to an account owned by the vendor itself. The
`individual then absconded with the funds a nd left the work on the retaining wall
`unperformed. This too was done without Mr. Murphy’s knowledge and was later
`disclosed to Mr. Murphy in or about September of 2024.
`85. Mr. Sharkansky and Trion also failed to maintain the premises of the
`Project in a commercially r easonable manner. Just last month, in August of 2025,
`another investor in the Project sent a team to conduct an in-person site visit and
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`observed first-hand the poor condition in which Mr. Sharkansky and Trion kept the
`Project. For example, the landscaping was overgrown; the trash was not picked up;
`significant irrigation leaks were no ticed that filled the street with water; patio lights
`were broken and/or missing ligh tbulbs; and two of the Project’s pools were out of
`order and contained water th at was opaque an d deep green color, indicating they
`were out of order for an extended period of time. These issues are not the result of
`a lack of access to financing . Mr. Sharkansky and Trion were simply not prop erly
`and adequately managing the day-to-day conditions at the Project.
`COUNT I
`(BREACH OF CONTRACT)
`86. Plaintiffs repeat and reallege all preceding allegations as though fully
`set forth herein.
`87. Section 18-111 of the Delaware Limited Liability Company Act permits
`this Court to “interpret, apply or enforce the provisions of a limited liability company
`agreement[.]”
`88. As alleged in detail above, Mr. Sharkansky and Trion have breached
`numerous provisions of the LLC A by acting unilaterally on numerous matters
`without Mr. Murphy’s authorization as a co-Manager.
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`89. Such unilateral actions far exceed Mr. Sharkansky’s authority under the
`provisions of the LLCA and disenfranchise Mr. Murphy of his rights as an equal co-
`Manager of the Project.
`90. Among other things, by unilaterally making significant decisions in
`respect of draw requests under the Loan , unilaterally entering into construction
`contracts, unilaterally obtaining member loans from Trion, and unilaterally initiating
`a capital call through Trion, all without Mr. Murphy’s authorization, Mr. Sharkansky
`breached sections 6.1(a)(i), 6.1(a)(iii), and 6.1(f) of the LLCA.
`91. As set forth in detail above, such sections provide, among other things,
`that the business and affairs of the Comp any shall be manage d under the direction
`of the Managers (plural), that the Manage rs (plural) have authority to undertake
`specific actions such as obtaining loans and entering contracts on behalf of the
`Project, and that the Managers shall each have one vote and the unanimous act of
`the Managers is required to constitute the act of the Company.
`92. Furthermore, Mr. Sharkansky also breached § 6.3(a) of the LLCA,
`which provides that each Manager is “r esponsible for performing all duties and
`obligations of a Manager a nd shall devote a reasonable am ount of business time to
`the business and affairs of the Company as is necessary to perform the duties and
`carry out the responsibilities as a Manager in a diligent and professional manner.”
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`93. By allowing a default judgment to be entered against the PropCos and
`a Constable’s sale to occur, only to ha ve to unwind the sale through a negotiated
`resolution with the transferee and then fail to disclose any of it to his co-Manager,
`Mr. Sharkansky did not responsibly pe rform his duties and did not devote a
`reasonable amount of time to the business.
`94. Mr. Sharkansky’s pattern of violating the LLCA and taking unilateral
`unauthorized actions requires that he be removed from his role as Manager to prevent
`ongoing harm.
`COUNT II
`(BREACH OF CONTRACTUAL FIDUCIARY DUTIES)
`95. Plaintiffs repeat and reallege all precedi