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Filed: December 20, 2012
IN THE SUPREME COURT OF THE STATE OF OREGON
SYNECTIC VENTURES I, LLC, an Oregon limited liability company; SYNECTIC VENTURES II, LLC, an Oregon limited liability company; SYNECTIC VENTURES III, LLC, an Oregon limited liability company,
Plaintiffs-Appellants, Petitioners on Review,
v.
EVI CORPORATION, an Oregon corporation,
dba Endovascular Instruments, Inc.;
SYNECTIC VENTURES IV, LLC,
an Oregon limited liability company;
SYNECTIC VENTURES V, LLC,
an Oregon limited liability company;
and SYNECTIC ASSET VENTURES, LLC,
purportedly an Oregon limited liability company,

Defendants-Respondents, Respondents on Review.
(CC 060404199; CA A139879 (Control), A142184; SC S059454)
En Banc
On review from the Court of Appeals.*
Argued and submitted January 10, 2012.
Scott A. Shorr, Stoll Stoll Berne Lokting & Shlachter PC, Portland, argued the cause for petitioners on review.  With him on the brief were Gary M. Berne, Mark A. Freil, and Roy Pulvers, Hinshaw & Culbertson LLP, Portland.
Kevin H. Kono, Davis Wright Tremine LLP, Portland, argued the cause for respondents on review.  With him on the brief were Robert D. Newell and Derek D. Green.
Cody Hoesly, Larkins Vacura LLP, Portland, filed a brief on behalf of amicus curiae Oregon Trial Lawyers Association.
DE MUNIZ, J.
The decision of the Court of Appeals is reversed.  The judgments of the circuit court are reversed, and the case is remanded to the circuit court for further proceedings.
*Appeal from Multnomah County Circuit Court, Henry C. Breithaupt, Judge Pro Tempore. 241 Or App 550, 251 P3d 216 (2011).
1  DE MUNIZ, J.  
2  Plaintiffs --Synectic Ventures I, LLC, Synectic Ventures II, LLC, and  
3  Synectic Ventures III, LLC --entered into a loan agreement regarding money that they  
4  had loaned to defendant EVI Corporation.  The loan agreement provided that the loan,  
5  which was secured by a security interest in essentially all of defendant's property, would  
6  be converted to equity ownership in defendant, if defendant obtained additional financing  
7  by a certain date.  Shortly before that deadline, the managing member of plaintiffs --who  
8  was also chairman of the board and treasurer of defendant and financially interested in  
9  defendant --entered into an agreement purporting to extend the loan period by an  
10  additional year.  During the extension period, defendant obtained the additional financing  
11  and converted the debt to equity.  Plaintiffs filed an action against defendant, asserting  
12  (among other things) that they were not bound by the extension because the managing  
13  member had had a conflict of interest and defendant knew of the conflict.  The trial court  
14  rejected that argument and granted summary judgment for defendant.  The Court of  
15  Appeals affirmed.  Synectic Ventures I, LLC v. EVI Corp., 241 Or App 550, 251 P3d 216  
16  (2011). On review, we conclude that the trial court erred in granting defendant summary  
17  judgment. We therefore reverse the decision of the Court of Appeals and the judgment of  
18  the trial court.  
19  I. FACTS AND PROCEDURAL POSTURE  
20  A. Underlying Facts  
21  As noted, this case is before us on review from a trial court's grant of  
22  summary judgment for defendant.  Accordingly, we consider the facts, as well as all  

1 reasonable inferences from those facts, in the light most favorable to the nonmoving
2 party --in this case, plaintiffs.  Loosli v. City of Salem, 345 Or 303, 306 n 1, 193 P3d 623
3 (2008); see ORCP 47 C (on summary judgment, trial court must determine whether there
4 is no genuine issue of material fact "based upon the record before the court viewed in a
5 manner most favorable to the adverse party").
6 Plaintiffs are manager-managed limited liability companies (LLCs).1
7 Plaintiffs' purpose, as identified in their operating agreements, was to invest plaintiffs'
8 funds in all types of securities of other corporations.  Plaintiffs, in turn, were capitalized
9 by their members, who are individuals or entities seeking investment gains from the
10 money they contributed to plaintiffs; plaintiffs are, in effect, investment vehicles for their
1 Plaintiffs assert that they are member-managed LLCs, but defendant disputes that assertion.  The distinction between manager-managed LLCs and member

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Oregon Law