Case Title: Marie L. Kasten v. Doral Dental USA

Citation: 2007 WI 76

Docket Number: 2005AP000995

State: wisconsin

Court: Wisconsin Supreme Court

Date: 2007-06-22T00:00:00Z

Document:
2007 WI 76 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2005AP995 
 
 
COMPLETE TITLE: 
 
 
Marie L. Kasten, 
          Plaintiff-Appellant, 
     v. 
Doral Dental USA, LLC, 
          Defendant-Respondent. 
 
 
 
 
ON CERTIFICATION FROM THE COURT OF APPEALS 
 
 
OPINION FILED: 
June 22, 2007   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
October 30, 2006   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Ozaukee 
 
JUDGE: 
Thomas R. Wolfgram   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
        
 
NOT PARTICIPATING: CROOKS, J., did not participate.   
 
 
 
ATTORNEYS: 
 
For the plaintiff-appellant there were briefs by Jane C. 
Schlicht, David A. McClurg, and Cook & Franke S.C., Milwaukee, 
and oral argument by Jane C. Schlicht. 
 
For the defendant-respondent there was a brief by K. Scott 
Wagner, Jacques C. Condon, and Hale & Wagner, S.C., Milwaukee, 
and oral argument by K. Scott Wagner. 
 
 
2007 WI 76
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  2005AP995  
(L.C. No. 
2003CV488) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Marie L. Kasten, 
 
          Plaintiff-Appellant, 
 
     v. 
 
Doral Dental USA, LLC, 
 
          Defendant-Respondent. 
 
FILED 
 
JUN 22, 2007 
 
David R. Schanker 
Clerk of Supreme Court 
 
 
 
 
 
APPEAL from an order of the Circuit Court for Ozaukee 
County, Tom R. Wolfgram, Judge.  Reversed and cause remanded.   
 
¶1 
LOUIS B. BUTLER, JR., J.  This case concerns a limited 
liability company (LLC) member's request to inspect company 
records and is before us on certification from the court of 
appeals, pursuant to Wis. Stat. § (Rule) 809.61 (2003-04).1  
Marie Kasten, a non-managing member of the former Doral Dental 
USA, LLC (Doral Dental), appeals from an order of the Ozaukee 
County Circuit Court, Honorable Tom R. Wolfgram, denying her 
                                                 
1 All references are to the 2003-04 version of the statutes 
unless otherwise noted.   
 
No. 
2005AP995   
 
2 
 
request to inspect copies of company electronic mails (e-mails) 
and document drafts, and an order of summary judgment dismissing 
her action to compel Doral Dental to comply with her inspection 
requests.2    
¶2 
The circuit court denied Marie's request to inspect e-
mails and document drafts on grounds that:  (1) the e-mails and 
document 
drafts 
were 
neither 
"records" 
under 
Wis. Stat. § 183.0405(2) nor "Company documents" under Doral 
Dental's operating agreement and, therefore, were not subject to 
inspection; and (2) Doral Dental was unable to make available 
for inspection the requested items because they were stored on 
computer equipment that was no longer under Doral Dental's 
control.   
¶3 
The court of appeals certification asks us to address 
the following questions: 
1)  Whether Wis. Stat. § 183.0405, part of the 
Wisconsin 
Limited 
Liability 
Company 
Law 
(WLLCL), 
grants a broad right of member access to limited 
liability 
company 
records 
that, 
absent 
contrary 
language in the LLC operating agreement, embraces 
informal and nonfinancial records;  
                                                 
2 Doral Dental moved to supplement the record with materials 
offered to show that the issues raised in this appeal were moot.  
We ordered the motion held in abeyance pending our decision in 
this case.  Copies of the materials submitted with this motion 
were first brought to the attention of the court when they were 
discussed in Doral Dental's initial brief and included in its 
appendix.  We previously granted a motion of Marie Kasten to 
strike these materials from Doral Dental's brief and ordered 
Doral Dental to file a new brief-in-chief.  We now deny Doral 
Dental's motion to supplement the record.    
No. 
2005AP995   
 
3 
 
2)  If the court determines that the statute 
grants members a broad inspection right, whether e-
mails can be classified as "records" under Wis. Stat. 
§ 183.0405(2) such that they are subject to a member's 
inspection. 
We believe that the certification raises novel questions of 
statutory interpretation.  However, the case before us does not 
present the precise questions that the certification raises.  
 
¶4 
Wisconsin Stat. § 183.0405(2) grants LLC members the 
right to inspect "any . . . limited liability company record," 
"unless otherwise provided in an operating agreement."  Doral 
Dental's operating agreement gives members the right to inspect 
"Company documents" as well as "records."  See Doral Dental 
Operating Agreement, §§ 6(k)(i) (providing right to inspect 
"all . . . records") and 8(e) (providing a right to inspect and 
copy "Company documents").   
¶5 
We 
conclude 
Doral 
Dental's 
operating 
agreement 
provides 
greater 
member 
rights 
of 
inspection 
than 
Wis. Stat. § 183.0405(2) 
because 
"Company 
documents" 
is 
a 
broader category of stored information than "records."3  We 
                                                 
3  A limited liability company (LLC) is required to keep at 
its principal place of business certain recorded information.  
Wis. Stat. § 183.0405(1).  The types of information required to 
be kept by § 183.0405(1) are formal writings, such as records of 
each member's contribution to the LLC, tax returns, financial 
statements, copies of all operating agreements, and the like.  
Also required to be kept are the value of each member's 
contribution to the LLC, records of the times at which or the 
events upon which additional contributions are agreed to be made 
by each member, any events upon which the LLC is to be dissolved 
and its business wound up, and other writings as required by the 
operating agreement.  Wis. Stat. § 183.0405(1)(e).  It is these 
other writings contained in the operating agreement that may 
exceed the scope of the other enumerated items contained within 
the statute.  
No. 
2005AP995   
 
4 
 
therefore do not address whether "informal" stored information 
and 
e-mails 
are 
"records" 
for 
purposes 
of 
Wis. Stat. § 183.0405(2).4  Construing Doral Dental's operating 
agreement, 
we 
conclude 
that 
"Company 
documents" 
embraces 
document drafts and some company e-mails.  We therefore conclude 
the circuit court's ruling to the contrary was in error. 
¶6 
As 
provided 
by 
Wis. Stat. § 183.0405 
and 
Doral 
Dental's operating agreement, an LLC member may make an 
inspection only "upon reasonable request."  We conclude that the 
reasonableness inquiry seeks to balance the statute's bias in 
favor of the member's right of inspection against the burden the 
specific request may place upon the company.  We construe the 
language "upon reasonable request" to pertain to the financial 
burdens a request may place upon the company, as well as the 
timing and form of inspection.  
¶7 
We therefore reverse the circuit court's orders 
denying Marie Kasten's request to inspect e-mails and document 
drafts 
and 
dismissing 
her 
declaratory 
action 
on 
summary 
judgment.  We remand this matter to the circuit court to 
reconsider Marie's request of July 2004 to inspect e-mails and 
document drafts in a manner consistent with this opinion.   
I 
¶8 
Doral Dental was organized on April 29, 1996, by, 
among others, Craig Kasten (Craig), who was then married to 
                                                 
4 We disagree with the assumption underlying the court of 
appeals' 
certification that e-mails are always "informal" 
communications.  See infra, ¶46.   
No. 
2005AP995   
 
5 
 
Marie Kasten (Marie).  Doral Dental's primary business was 
creating 
and 
administering 
dental 
programs 
for 
health 
maintenance organizations (HMOs) and state governments.  In the 
year 2000, Doral Dental reported revenues of $98.3 million.  
Marie asserts (and Doral Dental does not dispute) that much of 
Doral Dental's success was due to the utility of claims 
processing software developed by Craig.  In early 2001, Craig 
and Marie divorced, with each taking a 23.13% interest in Doral 
Dental.  MOA Investments, a company managed and part-owned by 
Doral Dental Chief Executive Officer Greg Borca, held 51.4% of 
Doral Dental, the lion's share of the interest in the company 
not held by Craig or Marie.   
¶9 
In February 2003 Marie began asserting her rights 
under the operating agreement and Wis. Stat. § 183.0405(2) to 
inspect and copy company records and documents.  Marie states 
that she made these requests because negotiations had begun with 
potential buyers for the sale of Doral Dental, and she was 
concerned that such a transaction would adversely impact her 
interest in the company.  Marie asserts that after reviewing 
documents produced in response to her initial inspection 
request, she "began to suspect that Doral's management was 
engaging in various actions adverse to her interests, such as 
the transfer, without adequate consideration of Doral's assets, 
including the [software] at the heart of the Company's success, 
to entities which Craig Kasten/MOA [Investments] owned, but she 
did not."  
No. 
2005AP995   
 
6 
 
¶10 Marie asserts that several of the documents that Doral 
Dental produced in response to her inspection requests gave her 
cause for concern.  Marie notes that a copy of a multi-part 
restructuring plan she obtained showed that Doral Dental was to 
be acquired by Doral Systems, Inc., a company owned by Craig in 
which Marie had no interest, and eventually placed under the 
ownership 
of 
Athena Insurance Technologies Corporation, a 
company that would be held by Craig and MOA Investments.  Marie 
further points to handwritten notes of an August 2001 meeting 
regarding a restructuring proposal that appeared to ask what 
"claims" Marie might have if the proposal were adopted.  She 
alleges that a company e-mail5 Craig sent to other Doral Dental 
executives and its attorney, stating that he "would rather sell 
Doral Dental for +$90 million and focus on growing the emerging 
companies[,]" indicates that Craig intended to steer future 
growth opportunities away from Doral Dental.  
¶11 From February to October 2003, Marie made numerous 
requests of Doral Dental managers and their attorneys to inspect 
company records.  Doral Dental fulfilled to Marie's satisfaction 
some of these requests but not others.  In November 2003 Marie 
filed an action in Ozaukee County Circuit Court seeking an order 
pursuant to the operating agreement and Wis. Stat. § 183.0405 
requiring Doral Dental to provide Marie with copies of documents 
                                                 
5 Doral Dental produced some e-mails in response to Marie's 
inspection requests before ultimately denying further requests 
for e-mails on grounds Marie was not entitled to inspect them 
under Wis. Stat. § 183.0405(2) and the operating agreement. 
No. 
2005AP995   
 
7 
 
not yet produced and to respond to her requests for information 
about Doral Dental's attempts to sell the company.  Doral Dental 
states that prior to and during the ensuing litigation, it 
provided for Marie's inspection over thirteen boxes containing 
35,000 documents. 
¶12 In April 2004 some of Doral Dental's assets, including 
some computer equipment, were sold to DentaQuest Ventures (DQV) 
for approximately $95 million.  Marie received $17.9 million 
from the sale.6  In July 2004 Marie filed a motion to compel 
production of documents not yet provided for inspection by Doral 
Dental.  The motion sought inspection of electronic files and 
document drafts first requested in two June 2004 letters to 
Doral Dental.  Specifically, the motion requested the following:  
"For the years 2001 to the present, e-mails by/to/from Greg 
Borka, 
Craig 
Kasten 
or 
Lisa 
Sweeney"; 
"[a]ll 
internal 
communications between the officers or directors of Doral (e-
mail, memo or correspondence) for the years 2001 to the 
present"; and "drafts of . . . sales documents and exhibits."  
Marie proposed that a computer expert provided at her expense 
"make a copy of the e-mail server."   
¶13 Doral Dental opposed Marie's request to inspect e-
mails and other electronically stored files, asserting that "all 
computers were sold," and that, regardless, the request was 
unreasonable under Wis. Stat. § 183.0405(2) and the operating 
                                                 
6 Following the sale, Doral Dental changed its name to DD 
Sale, LLC.  For the sake of clarity, we refer to the company as 
Doral Dental throughout. 
No. 
2005AP995   
 
8 
 
agreement because it contained no limitation as to subject 
matter, and sought all e-mails over a three-year period.  Doral 
Dental argued that the e-mails likely numbered in the hundreds 
of thousands and that it would have to review each e-mail to 
segregate those containing information to which Marie was not 
entitled, including attorney-client communications and personal 
communications not related to company business.   
¶14 The circuit court held a hearing on July 30, 2004, on 
the motion to compel.  In a bench decision, the circuit court 
concluded that e-mails were not "Company documents" under the 
operating agreement, and, further, that Doral Dental could not 
produce the e-mails because the computer equipment containing 
these documents was no longer in its possession:  
 
I guess I have the most problem with the e-mails.  
They're not documents or records.  They're just 
communications.  It's like notes or a telephone call.  
I mean it's —— e-mails in my view are certainly 
entirely different, coupled with the fact that they 
don't have possession of the machines that are storing 
the electronic data.   
The circuit court concluded that e-mails were not subject to 
inspection under the WLLCL or the operating agreement: 
 
First of all, I think the term "documents" is 
broader than the term "records."  It may well 
encompass things which would not fall under the 
contemplation of the statute.  And as such, I think 
that the agreement provides a broader basis upon which 
to request information than the statute itself does. 
 
I 
don't 
think 
that 
emails 
fall 
under 
the 
definition of documents.  They just don't.  They're 
communications.  It's like asking someone to provide a 
summary of a telephone conversation.  It may be 
memorialized electronically, but it clearly in my view 
No. 
2005AP995   
 
9 
 
is not a document, nor a draft that may be contained 
on those emails.  They're simply not documents in my 
opinion as that was contemplated by the terms of the 
operating agreement. 
The circuit court added: 
 
The other basis for my ruling as to the emails is 
that, quite frankly, I think they're out of the 
control of the company at this point.  They're 
contained on machines that they don't have.  There may 
be other ways to get those documents, but I don't 
think that I could under anything compel Doral to go 
and get them.  I don't think they have the ability to 
do that, nor do they have to go out and actually 
create 
something. 
 
I 
don't 
think 
that's 
their 
responsibility.  
 
¶15 On August 2, 2004, Marie served a subpoena on DQV to 
obtain copies of the hard drives of the computers Doral Dental 
sold to DQV, and copies of back-up tapes containing e-mail and 
other electronic data produced through April 2, 2004, the date 
Doral Dental was sold to DQV.  Marie and DQV reached an 
agreement whereby a computer expert would copy, at Marie's 
expense, the hard drives of computers used by Ronald Brummeyer 
and Lisa Sweeney, two DQV employees who had formerly worked for 
Doral Dental.  The computer expert would then provide a written 
report of his findings for Marie and DQV, who would meet to 
confer regarding the production "of any such e-mail that may be 
relevant" to the action against Doral Dental.   
¶16 In response, Doral Dental filed a motion for a 
protective order to prevent Marie from obtaining a copy of the 
electronic files from DQV.  The circuit court denied Doral 
Dental's motion, concluding that Doral Dental no longer had an 
interest in documents contained on the computer equipment it had 
No. 
2005AP995   
 
10 
 
sold to DQV.  Marie asserts that she has not obtained access to 
these files, however, "due to DQV's acquiescence to Defendant's 
insistence that Doral and its counsel be allowed to 'screen' the 
e-mails to determine what should be produced" to her.  The 
circuit court formalized its ruling regarding the protective 
order, and its prior ruling denying Marie's request to obtain e-
mails and drafts from Doral Dental directly, in a January 2005 
written order.   
¶17 In November 2004 Doral Dental filed a motion for 
summary judgment.  Marie requested that a hearing on the motion 
be stayed because she had yet to obtain a copy of the electronic 
files from DQV.  She also requested that the circuit court 
consider first whether certain correspondence between Doral 
Dental's 
managers 
and 
its 
attorneys 
was 
subject 
to 
the 
crime/fraud exception to the rule of attorney-client privilege.  
The circuit court denied Marie's motion for a stay.  It then 
granted Doral Dental's motion for summary judgment, concluding 
that Doral Dental had "complied with [all requests for record 
inspection] that they were supposed to comply with."   
¶18 Marie appealed to the court of appeals, and the court 
of appeals certified this case to address the scope of an LLC 
member's right of inspection, and whether this right encompasses 
the right to inspect e-mails and document drafts. 
II 
 
¶19 This case requires us to examine the record inspection 
provisions of Wisconsin's Limited Liability Company Law (WLLCL) 
contained 
in 
Wis. Stat. § 183.0405, 
and 
the 
inspection 
No. 
2005AP995   
 
11 
 
provisions of the operating agreement of Doral Dental USA, LLC.  
Statutory interpretation and contract interpretation are matters 
of law subject to our independent review.  See Gottsacker v. 
Monnier, 2005 WI 69, ¶13, 281 Wis. 2d 361, 697 N.W.2d 436.   
¶20 This case was disposed of by the circuit court on 
summary judgment.  We review a grant of summary judgment de 
novo, benefiting from the circuit court's analysis, but applying 
the same methodology as the circuit court.  Dairyland Greyhound 
Park, Inc. v. Doyle, 2006 WI 107, ¶15, 295 Wis. 2d 1, 719 N.W.2d 
408.    
III 
¶21 We begin by discussing the legal background of the 
WLLCL, and the applicable language of Wis. Stat. § 183.0405 and 
the operating agreement. 
A 
¶22 We first considered Wisconsin's limited liability 
company statute two years ago in Gottsacker.  There, we noted 
that the LLC is a hybrid business form that combines structural 
elements of the corporation and the partnership forms:   
From 
the 
partnership 
form, 
the 
LLC 
borrows 
characteristics of informality of organization and 
operation, internal governance by contract, direct 
participation by members in the company, and no 
taxation at the entity level.  From the corporate 
form, the LLC borrows the characteristic of protection 
of members from investor-level liability.  
Gottsacker, 281 Wis. 2d 361, ¶15.7   
                                                 
7 For additional discussion of the history and development 
of the LLC, see Gottsacker v. Monnier, 2005 WI 69, ¶¶13-17, 281 
Wis. 2d 361, 697 N.W.2d 436.   
No. 
2005AP995   
 
12 
 
¶23 Wisconsin enacted its LLC statute, the Wisconsin 
Limited Liability Company Law (WLLCL), Chapter 183 of the state 
statutes, in 1993.  Id., ¶18.  The drafters of the WLLCL 
borrowed concepts from the state partnership and corporation 
statutes, Chapters 179 and 180 respectively, and the 1992 
Prototype Limited Liability Company Act, a product of an ABA 
Business Law Section subcommittee.  Id.   
¶24 The WLLCL contains an explicit statement of statutory 
purpose, which provides, in part, that "[i]t is the policy of 
this chapter to give maximum effect to the principle of freedom 
of contract and to the enforceability of operating agreements."8 
Wis. Stat. § 183.1302(1).  LLCs and LLPs:  A Wisconsin Handbook 
§ 1.11 (rev. ed. 1999), written by the members of the State Bar 
Business Law Committee who drafted the WLLCL, explains that the 
committee members sought to encourage LLCs to adopt their own 
rules 
by 
operating 
agreement, 
while 
establishing 
default 
statutory rules that were simple enough to be used by "mom and 
pop" operations:    
[F]lexibility within the act and freedom of contract 
among members were the overriding goals [of the 
WLLCL]. . . . [T]he 
WLLCL 
incorporated 
flexible 
default provisions that were designed to apply only if 
the 
operating 
agreement 
did 
not 
address 
the 
issue. . . .  
The paramount importance of flexibility and freedom of 
contract is evident throughout the WLLCL.  All 
                                                 
8 "Operating agreement" is defined within Chapter 183 as "an 
agreement in writing, if any, among all of the members as to the 
conduct of the business of a limited liability company and its 
relationships with its members."  Wis. Stat. § 183.0102(16).   
No. 
2005AP995   
 
13 
 
statutory 
provisions 
dealing 
with 
governance, 
membership, finance, dissolution and even fiduciary 
duties may be varied by the operating agreement.  The 
drafters intended the operating agreement to give 
members the opportunity to establish the real law 
applicable to the LLC, even with the attendant risk to 
the unsophisticated investor. 
Notwithstanding this approach, it was also intended 
that the LLC form be suitable for the "mom and pop" 
grocery store.  The drafters hoped that the LLC would 
provide an inexpensive and simple vehicle that did not 
require legal guidance at every step.  Indeed, it was 
visualized that an operating agreement would not even 
be required for many LLCs or that the agreement would 
merely focus on the specifics of the business deal, 
permitting the statute to fill in the gaps.  Thus, the 
default provisions were drafted with a common-sense 
business approach.9  
¶25 The default rules concerning the rights of LLC members 
to inspect company records, and the duties of LLC managers to 
disclose 
information 
to 
members, 
are 
provided 
in 
Wis. Stat. § 183.0405.  Subsection (1) of § 183.0405 sets forth 
the records a limited liability company must keep at its 
principal place of business.  These include a list of members, 
and, if applicable, manager(s); copies of the articles of 
organization and all amendments thereto; copies of tax returns 
and financial statements; copies of all operating agreements, 
all amendments thereto, and operating agreements no longer in 
effect; the value of each member's contribution to the LLC; 
information concerning additional contributions to be made by 
                                                 
9 We note that the drafters intended "that the LLC would 
provide an inexpensive and simple vehicle that did not require 
legal guidance at every step."  Some LLCs may decide that the 
inspection rules of the WLLCL do not meet their needs and 
therefore adopt their own rules.  
No. 
2005AP995   
 
14 
 
each member; events upon which the LLC is to be dissolved; and 
any other writings required under the operating agreement.10  
                                                 
10 Wisconsin Stat. § 183.0405(1) provides: 
A 
limited 
liability 
company 
shall 
keep 
at 
its 
principal place of business all of the following: 
(a) A list, kept in alphabetical order, of each past 
and present member and, if applicable, manager. The 
list shall include the full name and last-known 
mailing address of each member or manager, the date on 
which the person became a member or manager and the 
date, if applicable, on which the person ceased to be 
a member or manager. 
(b) A copy of the articles of organization and all 
amendments to the articles. 
(c) Copies of the limited liability company's federal, 
state and local income or franchise tax returns and 
financial statements, if any, for the 4 most recent 
years or, if such returns and statements are not 
prepared for any reason, copies of the information and 
statements provided to, or which should have been 
provided to, the members to enable them to prepare 
their federal, state and local income tax returns for 
the 4 most recent years. 
(d) Copies of all operating agreements, all amendments 
to operating agreements and any operating agreements 
no longer in effect. 
(e) 
Unless 
already 
set 
forth 
in 
an 
operating 
agreement, written records containing all of the 
following information: 
1. The value of each member's contribution made to the 
limited liability company as determined under s. 
183.0501(2). 
2. Records of the times at which or the events upon 
which any additional contributions are agreed to be 
made by each member. 
3. Any events upon which the limited liability company 
is to be dissolved and its business wound up. 
No. 
2005AP995   
 
15 
 
¶26 Wisconsin Stat. § 183.0405(2) addresses the right of a 
member to inspect company records.  It provides as follows: 
"Upon reasonable request, a member may, at the member's own 
expense, inspect and copy during ordinary business hours any 
limited liability company record required to be kept under sub. 
(1) and, unless otherwise provided in an operating agreement, 
any other limited liability company record, wherever the record 
is located."  Chapter 183 does not define what constitutes an 
LLC "record," or indicate what constitutes a "reasonable 
request" for inspection.  
¶27 The WLLCL further addresses a member's right to 
company information by imposing a duty upon LLC managers to 
disclose "true and full information of all things affecting the 
[LLC] members to any member . . . upon reasonable request of the 
member or [the member's] legal representative."  Wisconsin Stat. 
§ 183.0405(3) provides in full:  
Members or, if the management of the limited liability 
company is vested in one or more managers, managers 
shall provide, to the extent that the circumstances 
render 
it 
just 
and 
reasonable, 
true 
and 
full 
information of all things affecting the members to any 
member or to the legal representative of any member 
upon reasonable request of the member or the legal 
representative. 
¶28 Here, Doral Dental's operating agreement included two 
provisions regarding a member's right of inspection that were 
effective when Marie made the July 2004 inspection request that 
                                                                                                                                                             
4. Other 
writings 
as 
required 
by 
an 
operating 
agreement. 
 
No. 
2005AP995   
 
16 
 
is the focus of this appeal.11  Section 6(k)(i) of Doral Dental's 
operating agreement provided as follows: 
 
Books of Account.  The manager shall maintain 
full and accurate books of account for the Company at 
the principal Company office.  Each Member shall have 
access and the right to inspect and copy such books 
and all other Company records at all reasonable times. 
Section 8(e) of the operating agreement provides:  
 
Company Books.  Upon reasonable request, each 
Member shall have the right, during ordinary business 
hours, to inspect and copy Company documents at the 
requesting Member's expense.   
Doral Dental's operating agreement is silent on the company 
managers' duty to disclose information to Doral Dental members. 
B 
¶29 Doral 
Dental 
contends 
that 
Wis. Stat. § 183.0405 
should not be read to authorize members to make unlimited record 
requests that amount to "corporate proctology exams."  Doral 
Dental argues that a member's right to inspect company records 
hinges on the reasonableness of the request, citing language of 
§ 183.0405(2) 
that 
authorizes 
inspections 
"upon 
reasonable 
request."  It asserts that the operating agreement similarly 
provides that Doral Dental managers need comply only with 
"reasonable" member requests to access records.  It further 
                                                 
11 Doral Dental notes that its operating agreement was 
amended on June 1, 2005, to limit a member's right to inspect 
records to copies of income tax returns, copies of the current 
and past operating agreements and consent resolutions by 
members, and minutes of all meetings by members.  We consider 
Marie's July 2004 request under the version of the operating 
agreement in effect at the time of her request.  
No. 
2005AP995   
 
17 
 
notes 
that 
the 
requirement 
of 
§ 183.0405(3) 
that 
the 
member/managers or managers of an LLC provide "true and full 
information of all things affecting the members to any member" 
is only "to the extent that the circumstances render it just and 
reasonable."   
¶30 Doral Dental asserts that the types of documents 
described 
in 
Wis. Stat. § 183.0405(1) 
(member 
lists, 
tax 
returns, copies of the operating agreement, values of member 
contributions, 
dissolution 
events 
and 
"other 
writings 
as 
required by an operating agreement") are illustrative of those 
that we should consider to be "records" under § 183.0405(2).  It 
further notes that subsection (2) does not reference e-mails or 
drafts of documents.  
 
¶31 When construing a statute, we begin with the statutory 
language.  State ex rel. Kalal v. Circuit Court, 2004 WI 58, 
¶45, 271 Wis. 2d 633, 681 N.W.2d 110.  "If the meaning of the 
statute is plain, we ordinarily stop the inquiry."  Id. 
(citation omitted).  Nevertheless, the scope, context and 
purpose 
of 
a 
statute 
are 
relevant 
to 
a 
plain-meaning 
interpretation of an unambiguous statute "as long as the scope, 
context, and purpose are ascertainable from the text and 
structure of the statute itself, rather than extrinsic sources, 
such as legislative history."  Id., ¶48.  "A statute's purpose 
or scope may be readily apparent from its plain language or its 
relationship to surrounding or closely-related statutes——that 
is, from its context or the structure of the statute as a 
coherent whole."  Id., ¶49.  When a statute contains an explicit 
No. 
2005AP995   
 
18 
 
statement of legislative purpose or scope, we may consider it 
when ascertaining a statute's plain meaning.  Id.  
¶32 We begin by examining the record inspection provisions 
of two closely-related statutes, the corporation and partnership 
statutes.  As we noted above, the LLC is a hybrid of these two 
business forms, and the drafters of Wisconsin's LLC statute 
borrowed freely from these established forms in crafting the 
WLLCL.  LLCs and LLPs:  A Wisconsin Handbook, § 1.16.  
¶33 Wisconsin Stat. § 179.05(1) of Wisconsin's Uniform 
Limited Partnership Act enumerates the records a limited 
partnership must keep.  Section 179.05(2) then provides that 
records under that subsection "are subject to inspection and 
copying at the reasonable request, and at the expense, of any 
partner during ordinary business hours."  Section 179.05 does 
not include explicit requirements concerning the form, timing 
and purpose of the request.  Like the WLLCL, the limited 
partnership statute provides an interest holder with the right 
to inspect and copy records "at the reasonable request" of the 
interest holder.  However, the limited partnership statute 
appears to restrict the right to inspect records to those 
enumerated by the statute, while the WLLCL contains no such 
limitation; LLC members may inspect and copy "any other LLC 
records" 
in 
addition 
to 
those 
enumerated 
in 
Wis. Stat. §  183.0405(1), "unless otherwise provided in an 
operating agreement."  § 183.0405(2).  
¶34  The 
corporation 
inspection 
statute, 
Wis. Stat. 
§ 180.1602(2)(b), contains numerous limitations on shareholder 
No. 
2005AP995   
 
19 
 
access to corporate records, including requirements that the 
requests be made "in good faith and for a proper purpose," and 
that the request identify "with reasonable particularity" the 
records sought and the purpose of the request.  Moreover, an 
inspection request must target only those records that "are 
directly connected with [the requester's] purpose."  See 
§ 180.1602(2)(b)3.-5.12   
                                                 
12 Wisconsin Stat. § 180.1602 provides, in part: 
(2)(a) Except as provided in par. (c) and sub. (4), a 
shareholder of a corporation who satisfies par. (b) 
may inspect and copy, during regular business hours at 
a reasonable location specified by the corporation, 
any of the following records of the corporation: 
1. Excerpts from any minutes or records that the 
corporation is required to keep as permanent records 
under s. 180.1601(1). 
2. Accounting records of the corporation. 
3. The record of shareholders, except as provided in 
s. 180.1603(3). 
(b) To inspect and copy any of the records under par. 
(a), the shareholder must satisfy all of the following 
requirements: 
1. The shareholder has been a shareholder of the 
corporation for at least 6 months before his or her 
demand under subd. 2, or the shareholder holds at 
least 5% of the outstanding shares of the corporation. 
2. The shareholder gives the corporation written 
notice that complies with s. 180.0141 of his or her 
demand at least 5 business days before the date on 
which he or she wishes to inspect and copy the 
records. 
3. The shareholder's demand is made in good faith and 
for a proper purpose. 
No. 
2005AP995   
 
20 
 
¶35 Doral Dental urges us to look to the corporation 
inspection 
statute 
for 
guidance 
in 
interpreting 
Wis. Stat. § 183.0405.  Doral Dental asserts that the explicit 
limitations 
on 
a 
shareholder's 
record 
inspection 
demand 
contained in the corporation statute strike a proper balance 
between the shareholder's legitimate need for information and 
the corporation's need to be protected from repeated, harassing 
record requests.  It argues that language limiting a member's 
                                                                                                                                                             
4. 
The 
shareholder 
describes 
with 
reasonable 
particularity his or her purpose and the records that 
he or she desires to inspect. 
5. The records are directly connected with his or her 
purpose. 
(c) A person that has delivered the resolution under 
s. 180.1150(4) may, by giving written notice to the 
resident 
domestic corporation, as defined in s. 
180.1150(1)(c), 
that 
complies 
with 
s. 
180.0141, 
inspect and copy the record of shareholders of the 
resident domestic corporation, in person or by agent 
or attorney at any reasonable time for the purpose of 
communicating with the shareholders in connection with 
the 
special 
shareholders' 
meeting 
under 
s. 
180.1150(5). 
(3) The rights under this section may not be abolished 
or limited by the domestic corporation's articles of 
incorporation or bylaws. 
(4) This section does not affect any of the following: 
(a) The right of a shareholder to inspect records 
under s. 180.0720 or, if the shareholder is in 
litigation with the corporation, to the same extent as 
any other litigant. 
(b) The power of a court, independently of this 
chapter, to compel the production of corporate records 
for examination. 
No. 
2005AP995   
 
21 
 
right to inspect records to requests that are "reasonable" 
establishes a similar balance in the LLC context between the 
inspection right of members and the need to protect companies 
from improper record requests.    
¶36 However, 
consideration 
of 
the 
WLLCL's 
inspection 
provision in light of its corporate counterpart only serves to 
highlight the differences between the statutes.  The corporation 
statute includes a host of explicit requirements not provided in 
the WLLCL's inspection statute, including that the requester 
either hold at least five percent of the company's shares or be 
a shareholder for at least six months prior to the request; that 
the request be made in writing, and at least five days prior to 
the desired inspection date; and that the records requested be 
directly 
connected 
to 
the 
purpose 
of 
the 
request.  
Wis. Stat. § 180.1602(2)(b).   
¶37 Additionally, 
the 
corporation 
statute 
limits 
shareholder inspection rights to the types of records enumerated 
in 
Wis. Stat. §  180.1602(2)(a).  The WLLCL, by contrast, 
contains no explicit restrictions on the time and place of 
inspection, and allows access to "any . . . limited liability 
company record," unless otherwise provided by the operating 
agreement.  Wis. Stat. § 183.0405(2).  Indeed, the transparency 
of the business form established by the default rules of the 
WLLCL is further illustrated by its unique requirement that 
managers provide "true and full information of all things 
affecting the members to any member  . . .  upon reasonable 
No. 
2005AP995   
 
22 
 
request of the member."  Wis. Stat. § 183.0405(3).  There is no 
analogue to this provision in the corporation statute.  
¶38 By the plain language of Wis. Stat. § 183.0405(2), an 
LLC member may inspect anything that is a "record," and access 
will be granted to the member "upon reasonable request."  Thus, 
the scope of a member's right of inspection under the default 
inspection provisions of § 183.0405(2) is exceptionally broad, 
and hinges on what constitutes an LLC "record," and the degree 
and kind of restrictions on access that "upon reasonable 
request" may impose.  
¶39 This interpretation is consistent with the purposes of 
simplicity and freedom of contract that are at the heart of the 
WLLCL.  As we said in Gottsacker, the overriding goal of the 
WLLCL was "to create a business entity providing limited 
liability, flow-through taxation, and simplicity."13  Gottsacker, 
281 Wis. 2d 361, ¶19 (citation omitted).  See LLCs and LLPs:  A 
Wisconsin Handbook at § 1.11 ("[I]t was  . . .  intended that 
the LLC form be suitable for the 'mom and pop' grocery 
store. . . .   Indeed, it was visualized that an operating 
agreement 
would 
not 
even 
be 
required 
for 
many 
LLCs."); 
Wis. Stat. § 183.1302(1) ("It is the policy of [the WLLCL] to 
give maximum effect to the principle of freedom of contract and 
to the enforceability of operating agreements.").   
                                                 
13 In Gottsacker, we recognized that the drafters of the 
WLLCL hoped that a Wisconsin LLC would provide an inexpensive 
vehicle that did not require legal counsel at every step, and 
that a Wisconsin LLC be treated as a partnership for tax 
purposes.  Gottsacker, 281 Wis. 2d 361, ¶19.  
No. 
2005AP995   
 
23 
 
¶40 The 
default 
inspection 
rules 
provided 
in 
Wis. Stat. § 183.0405(2) were designed for less sophisticated 
companies that would be less likely to craft their own 
inspection rules in an operating agreement.  Accordingly, the 
default provisions do not include cumbersome restrictions on 
records access that might burden such businesses.  Conversely, 
the statutory scheme envisions that larger, more sophisticated 
companies with multiple members may chose to adopt inspection 
rules that may be more suited to their needs, and the statute 
permits them to do so by the operating agreement.14   
¶41 In this case, we note that the inspection provisions 
of the operating agreement are not identical to those of 
Wis. Stat. § 183.0405(2).  While the operating agreement, like 
the statute, provides for inspection "upon reasonable request," 
the agreement provides members a right to inspect "documents" as 
well as "records."  We therefore examine first whether, under 
language 
of 
the 
operating 
agreement, 
informal 
stored 
information, document drafts and e-mails may be "records" and/or 
"documents."   
C 
¶42 As noted above, section 6(k)(i) of Doral Dental's 
operating agreement provides that "[e]ach Member shall have 
                                                 
14 Under the WLLCL, larger, more sophisticated LLCs are free 
to adopt more restrictive inspection rules that may incorporate 
features of the corporation inspection statute. Of course, the 
statutory scheme also permits LLCs to adopt inspection rules 
that are less restrictive than the default statutory rules, as 
Doral Dental did here by its operating agreement.   
No. 
2005AP995   
 
24 
 
access and the right to inspect and copy such books and all 
other Company records at all reasonable times."  Later, section 
8(e) provides as follows:  "Upon reasonable request, each Member 
shall have the right, during ordinary business hours, to inspect 
and copy Company documents at the requesting Member's expense."   
¶43 The WLLCL does not define "record."  Likewise, Doral 
Dental's operating agreement does not define "record" or 
"Company document."15   
¶44 We therefore consult a dictionary to ascertain the 
common meaning of these words.  See State v. Denis L.R., 2005 WI 
110, ¶40, 283 Wis. 2d 358, 699 N.W.2d 154.  Merriam-Webster's 
Collegiate Dictionary (11th ed. 2003) defines "record" as "an 
authentic official copy of a document deposited with a 
legally designated officer," id. at 1040, and "document" as 
"a writing conveying information" or "a computer file 
containing information input by a computer user and usually 
created with an application (as a word processor)."  Id. at 
368.  Merriam-Webster's definition of "record"——"an authentic 
official copy of a document"——indicates that a "document" is a 
                                                 
15 We note that items an LLC must keep "at its principal 
place of business" under § 183.0405(1) are referred to in 
subsection (2) as "records."  See § 183.0405(2) ("a member 
may . . . inspect and copy . . . any limited liability company 
record required to be kept under sub. (1)").  As noted earlier, 
supra, ¶25, these items include a list of members, tax returns, 
and other items that record financial and organizational 
essentials of an LLC.  However, while subsection (2) indicates 
recordings of these essentials are "records," it does not limit 
"records" to only these types of items.  Likewise, the context 
in which the term "Company documents" appears in the operating 
agreement is of little assistance to us. 
No. 
2005AP995   
 
25 
 
broader category of stored information than "record," capturing 
all "records" and many types of stored information that would 
not be "records."  However, section 8(e) of the operating 
agreement does not permit inspection of "documents," but rather 
"Company documents."  We conclude that Doral Dental's operating 
agreement, by permitting inspection of "Company documents" as 
well as the statutorily-provided "records," affords access to 
more forms of stored information than the default inspection 
provisions of the WLLCL.  Thus, we do not address whether the 
right 
to 
access 
"any 
other 
records" 
under 
Wis. Stat. 
§ 183.0405(2) embraces "informal and nonfinancial records," 
and/or e-mails and document drafts.  We examine instead what 
constitutes a "Company document" subject to member inspection 
under Doral Dental's operating agreement, and, specifically, 
whether e-mails and document drafts may be "Company documents."   
¶45 The circuit court concluded that e-mails and document 
drafts 
were 
categorically 
neither 
"records" 
nor 
"Company 
documents" and therefore were not subject to inspection.  The 
circuit court reasoned that e-mail was a "communication," 
similar to a telephone call, and not a "record" or a "Company 
document."   
¶46 We agree with the circuit court that some e-mails may 
properly be categorized as private communications between the 
sender and the receiver that are neither "Company documents" nor 
"records."  Nevertheless, the circuit court's view fails to 
account for the ubiquity of e-mail in today's business world and 
the many purposes for which e-mail is now used.  E-mail is a 
No. 
2005AP995   
 
26 
 
primary tool of modern business communication.  One market 
research firm estimates that in 2006, there were 128.7 million 
business e-mail users, and that the typical business user sent 
and received 600 e-mails per week.  David Ferris, Industry 
Statistics 
(2006), 
http://www.ferris.com/research-library/ 
industry-statistics.   
¶47 For most businesses, e-mail has all but replaced 
hardcopy correspondence and memoranda.  Michael McCrystal, 
William C. Gleisner III, & Michael Kuborn, Coping with the Legal 
Perils of Employee Email, Wisconsin Lawyer, March 1999, at 48 
("Email 
is 
rapidly 
becoming 
a 
vehicle 
for 
intra-office 
communication that is as important, if not more important, than 
'snail' mail and hardcopy memoranda.").  A categorical holding 
that 
e-mail 
is 
never 
a 
"Company 
document" 
under 
Wis. Stat. § 183.0405(2) would be blind to the day-to-day volume 
of e-mail in the modern business setting and the business-
related purposes for which e-mail is used.  Moreover, such a 
holding would frustrate the purposes of the inspection statute 
by encouraging LLC managers to conduct business via e-mail to 
avoid the scrutiny of non-managing members.  
¶48 However, without addressing the question of whether 
all 
e-mail 
created 
and 
stored 
on 
company 
equipment 
is 
necessarily a "document," we do not believe that all of the 
requested 
e-mails 
in 
this 
case 
are 
necessarily 
"Company 
documents" subject to Marie's inspection under the Doral Dental 
operating agreement.  When construing the language of a 
contract, we give meaning to every word, avoiding constructions 
No. 
2005AP995   
 
27 
 
"which render[] portions of a contract meaningless, inexplicable 
or mere surplusage."  Goebel v. First Fed. Sav. and Loan Ass'n 
of Racine, 83 Wis. 2d 668, 680, 266 N.W.2d 352 (1978).  We 
construe "Company" to limit "documents" available for inspection 
to those relating to the business.  Stored information of a 
strictly personal or social nature, such as personal e-mails 
that do not touch upon business matters, are not "Company 
documents" subject to inspection under the operating agreement.16 
Subject 
to 
this 
limitation, 
we 
therefore 
conclude 
that 
information that is stored as e-mail may be a "Company document" 
subject to a member's reasonable inspection request under the 
operating agreement.  Because the circuit court concluded 
information that is stored as e-mail was categorically not a 
"Company document," its decision was in error.  See State v. 
Hutnick, 39 Wis. 2d 754, 763, 159 N.W.2d 733 (1968).  
 
¶49 With regard to Marie's request to inspect company 
document drafts, we conclude that such drafts are clearly "a 
writing conveying information," Merriam-Webster's definition of 
"document."  Merriam-Webster's New Collegiate Dictionary at 368.  
Accordingly, under the language of the operating agreement, 
                                                 
16 Our determination that e-mails that are strictly personal 
or social in nature are not "Company documents" is based on a 
plain meaning interpretation of the operating agreement.  We 
note that other factors not contained in the record before us 
may be relevant to a determination of what constitutes "Company 
documents," including whether Doral Dental had in effect a 
company 
policy 
regarding 
the 
use 
of 
e-mail, 
employment 
agreements addressing the ownership of e-mail with those 
employees whose e-mails were sought, and the terms of these 
policies and/or agreements.  
No. 
2005AP995   
 
28 
 
document drafts are subject to inspection upon a member's 
reasonable request.  We do not address here whether a document 
draft 
may 
be 
a 
"record" 
within 
the 
meaning 
of 
Wis. Stat. § 183.0405(2).  
¶50 We have thus concluded that the operating agreement 
provides member access to business-related company e-mails and 
document drafts.  This right is subject to "upon reasonable 
request" language contained in Wis. Stat. § 183.0405(2) and the 
operating agreement, which we consider in the next section.  We 
pause first, however, to consider what impact, if any, the 
requirement 
of 
§ 183.0405(3) 
that 
LLC 
managers 
provide 
"information" about "all things affecting the members" may have 
upon a request to inspect LLC records or documents.   
¶51 Wisconsin Stat. § 183.0405(3) is not a "record" or 
"document" inspection statute per se.  Rather, it imposes a duty 
upon managers to provide, "upon reasonable request," "true and 
full information of all things affecting the members," whether 
or not that information is recorded and stored as a "record" or 
a "document."  § 183.0405(3).  It establishes a member right to 
"true and full information," without regard to whether that 
information is recorded and stored as a "record" or "document."  
However, the requesting member is entitled under this section 
only to information "affecting the members."  § 183.0405(3).  
Managers must provide such information to members "to the extent 
that the circumstances render [the provision of the information] 
just and reasonable." Id.  
No. 
2005AP995   
 
29 
 
¶52 We construe the phrase "all things affecting the 
members" to mean all things affecting the requesting member's 
financial interest in the company.  To the extent that records 
and documents requested by Marie under Wis. Stat. § 183.0405(2) 
contain information affecting her financial interest in the 
company, subsection (3) requires that the information contained 
in the records or documents be furnished to Marie.   
¶53 Doral Dental contends that Wis. Stat. § 183.0405(3) 
limits the scope of records and documents subject to inspection 
under § 183.0405(2) and sections 6(k)(i) and 8(e) of the 
operating agreement to records and/or documents that "affect" 
the member's interest.  However, nothing in the text of 
subsections (2) and (3) suggests that the two should be read to 
limit each other.  Had the legislature intended to limit the 
scope of inspection provision to only those "records" that 
affect a member's membership interest, it would have done so in 
the text of the inspection provision.  
D 
¶54 Earlier, we rejected Doral Dental's argument that 
language in Wis. Stat. § 183.0405 and the operating agreement 
providing access to LLC records only "upon reasonable request" 
imposed on LLC members the specific limitations on inspection 
rights set forth in the corporation statute.  See supra, ¶34-37.  
We return now to this language to determine what constitutes a 
"reasonable request" with respect to LLC member inspection 
rights.  
No. 
2005AP995   
 
30 
 
 
¶55 For her part, Marie argues that "upon reasonable 
request" does not relate to the scope of records subject to 
inspection, only to the timing of the inspection and the form of 
production requested.  Marie asserts that where the legislature 
has provided access to records "upon reasonable request," it has 
not restricted the scope of the records requested, citing the 
inspection 
provisions of the limited partnership statute, 
Wis. Stat. § 179.05.  Marie notes that § 179.05(2) already 
limits a partner's inspection right to records required to be 
kept under § 179.05(1), so the limited partnership statute's 
guarantee of access "upon reasonable request" in that statute 
applies only to time and manner of inspection.  Marie reasons 
that because § 179.05(2) uses the phrase "upon reasonable 
request" in a very similar context, we should construe the 
phrase as having the same meaning in Wis. Stat. § 183.0405. 
 
¶56 Doral Dental contends that "upon reasonable request" 
applies to more than just the timing and form of the inspection, 
but also to the breadth of the request, to whether the request 
is tied to the concerns of the requester and to the types of 
records or documents requested.  Doral Dental argues that the 
reasonableness requirement attempts to strike a balance between 
member access to information and the LLC's ability to conduct 
its business.  Doral Dental asserts that the "upon reasonable 
request" language prohibits requests that are not reasonably 
limited by the date the requested items were created, by the 
place the items may be stored, and/or by the reason for the 
request.  Doral Dental also argues the reasonableness language 
No. 
2005AP995   
 
31 
 
should be read to limit the right of inspection to certain kinds 
of formal records, such as tax returns, financial records and 
sales tax documents.  
 
¶57 We disagree with Doral Dental that "upon reasonable 
request" language limits the types of records that are subject 
to inspection.  The statutory language unambiguously provides 
members with the right to inspect "any limited liability company 
record required to be kept under sub. (1) and, unless otherwise 
provided in an operating agreement, any other limited liability 
company record."  Wis. Stat. § 183.0405(2) (emphasis added).   
¶58 But we also disagree with Marie that the phrase "upon 
reasonable 
request" 
in 
Wis. Stat. § 183.0405(2) 
should 
be 
interpreted in the same manner in which it is used in the 
inspection 
provisions 
of 
the 
partnership 
statute, 
Wis. Stat. § 179.05(2).  The partnership statute differs from 
the LLC statute in that it authorizes inspection of only certain 
specified records, see § 179.05(1), while § 183.0405(2) permits 
inspection of all records the LLC must keep under § 183.0405(1) 
and "any other limited liability company record."  Because the 
right to inspect records under the partnership statute is 
already 
limited 
to 
only 
certain, 
specified 
records, 
the 
"reasonableness" of such a request would not encompass the types 
or scope of records sought by the request.  By contrast, an 
inspection request under the LLC statute is not limited to 
specified records, as LLC members may inspect any records (or, 
as here, even more items under the terms of the operating 
agreement).  
No. 
2005AP995   
 
32 
 
¶59 Chapter 183 does not explicitly address whether the 
reasonableness language encompasses the breadth of the request 
or whether it applies only to the timing and form of the 
request. 
 
Because 
neither 
the 
language 
of 
Wis. Stat. 
§ 183.0405(2) nor the context in which it appears provides any 
guidance as to the factors that may be relevant to whether an 
inspection request is "reasonable," we conclude the provision is 
ambiguous.  We therefore turn to extrinsic sources to ascertain 
the meaning of "upon reasonable request" within the context of 
Wis. Stat. § 183.0405(2).   
¶60 The legislative history of the WLLCL contains no 
discussion of the LLC inspection statute in general terms, much 
less any specific consideration of "upon reasonable request."  
The Wisconsin Handbook to LLCs, authored by the drafters of the 
WLLCL, is similarly mute.  Moreover, no Wisconsin cases have 
interpreted the inspection provision of the WLLCL, and no cases 
from other jurisdictions have interpreted similar "reasonable 
request" language contained in LLC inspection provisions of 
other states.   
¶61 However, 
other 
state 
inspection 
statutes 
provide 
insight into the meaning of Wisconsin's inspection provisions 
and the phrase "upon reasonable request."  As noted, the LLC is 
a new business form, and most state LLC statutes, including 
Wisconsin's, were adopted between 1990 and 1995.  1 Larry E. 
Ribstein and Robert R. Keatinge, Ribstein and Keatinge on LLCs, 
§ 1:2 (2d ed. 1996).  Because the drafters consulted other LLC 
statutes when drafting the WLLCL, see Gottsacker, 281 Wis. 2d 
No. 
2005AP995   
 
33 
 
361, ¶18 n. 5, differences between the WLLCL and other state LLC 
statutes suggest choices the drafters made that may be relevant 
to statutory meaning.  
¶62 One leading treatise has surveyed the various state 
LLC record inspection statutes and has identified four general 
approaches to LLC record inspection.  Ribstein and Keatinge on 
LLCs, App. 9-3.  It notes that in approximately half of the 
states, LLC members are permitted to inspect records only "upon 
demand for a proper purpose," id., a requirement familiar to 
corporation law and included in Wisconsin's corporation statute.  
See Wis. Stat. § 180.1602(2)(b)3.   
¶63 Other states, including Wisconsin, do not include an 
explicit "proper purpose" requirement, but require, in some 
fashion, that the inspection request be "reasonable."17  Ribstein 
and Keatinge on LLCs, App. 9-3.  Ribstein and Keatinge note that 
reasonableness limitations on LLC member inspection rights 
                                                 
17 These jurisdictions include Arkansas, Connecticut, the 
District of Columbia, Georgia, Iowa, Idaho, Illinois, Kansas, 
Louisiana, Michigan, North Dakota, New Mexico, Nevada, Oklahoma, 
Oregon, Rhode Island, Tennessee, Utah, Virginia, Wisconsin, and 
the American territories.  1 Larry E. Ribstein and Robert R. 
Keatinge, Ribstein and Keatinge on LLCs, App. 9-3 (2d ed. 1996).  
Indiana, which Ribstein and Keatinge list among those states 
without a "proper purpose" requirement, amended their inspection 
statute to require a showing of a "proper purpose," among other 
restrictions.  Ind. Stat. 53-625 (2006).  Minnesota, also 
included on this list by Ribstein and Keatinge, does not require 
that a member show that his or her request is made for a "proper 
purpose" when seeking to inspect certain records that the LLC 
must keep by law, but does require a showing of "proper purpose" 
when the request is for any LLC record not required to be kept 
by statute.   
No. 
2005AP995   
 
34 
 
contained in many state LLC statutes are not as restrictive as 
limits on corporation shareholder inspection rights, and as a 
result, "courts may be more lenient in allowing inspection in 
LLCs than in publicly held corporations."  Ribstein and Keatinge 
on LLCs, App. 9-3.  The authors explain that corporation 
inspection and disclosure statutes are more restrictive and 
detailed than those of LLCs and partnerships "because of the 
need [for corporations] to spell out ground rules that both 
avoid 
unreasonable 
and 
costly 
requests 
by 
thousands 
of 
shareholders and ensure disclosure by managers who are remote 
from the owners."  Id. at § 9:10.   
¶64 Nine 
jurisdictions, 
Alabama, 
Hawaii, 
Illinois, 
Montana, South Carolina, South Dakota, Vermont, the Virgin 
Islands, and West Virginia, have adopted the Uniform Limited 
Liability Company Act (ULLCA), which contains a member right to 
inspect records that includes no language requiring that a 
request be "reasonable" or made for a "proper purpose."  
Finally, two states, Nebraska and Wyoming, have LLC statutes 
that do not include an inspection provision.  Id.   
¶65 Those 
states that have adopted "proper purpose" 
language permit LLC managers to deny an inspection request based 
on the member's intent, regardless of whether the records sought 
would otherwise be available for member inspection.  Some 
commentators have argued that states that permit inspections 
without the showing of a "proper purpose" may be inviting record 
inspections that are contrary to the company's financial health.  
See J. William Callison and Allan W. Vestal, "They've Created a 
No. 
2005AP995   
 
35 
 
Lamb with Mandibles of Death":  Secrecy, Disclosure, and 
Fiduciary Duties in Limited Liability Firms, 76 Ind. L.J. 271, 
279 (1991).  One state law treatise urges that the "reasonable 
request" requirement contained in the Louisiana statutes (and 
similar to the WLLCL) be read to prohibit such inspection 
abuses.  It warns that  
without . . . [a] 
restrictive 
reading 
of 
the 
reasonable request requirement, even an LLC member who 
was starting up his own competing business would be 
entitled to copy his LLC's contracts, customer lists, 
and pricing calculations, as long as he was willing to 
do so with adequate notice and at a convenient time 
and place.  Surely, this is not the result that the 
legislature would have expected had it considered the 
matter.    
8 Glenn G. Morris and Wendell H. Holmes, La. Civ. L. Treatise, 
Business Organizations § 44.21 (1999).   
 
¶66 We read the absence of "proper purpose" language in 
Wis. Stat. § 183.0405(2) to indicate the drafters of the WLLCL 
chose not to require LLC members to demonstrate, as a threshold 
matter, that their inspection request is not made for an 
improper motive.  Moreover, this interpretation is in harmony 
with the intent of the WLLCL drafters to favor simple default 
rules suitable for "mom and pop" operations.  However, this does 
not mean that the statute is blind to a member's motive for 
making an inspection request. 
 
¶67 We conclude that a number of factors may be relevant 
to whether a request to inspect LLC records (or, here, "Company 
documents") was submitted "upon reasonable request."  The scope 
of items subject to inspection under Wis. Stat. § 183.0405(2)——
No. 
2005AP995   
 
36 
 
"any . . . record[s]," unless the operating agreement provides 
otherwise——is so broad that to permit any inspection request, no 
matter its breadth, could impose unreasonable burdens upon the 
operation of the company.  Because we do not believe that the 
drafters intended the inspection statute to threaten the 
financial well being of the company, we read "upon reasonable 
request" to pertain to the breadth of an inspection request, as 
well as the timing and form of the inspection. 
¶68 We therefore conclude that one purpose of the language 
"upon reasonable request" is to protect the company from member 
inspection requests that impose undue financial burdens on the 
company.18  Whether an inspection request is so burdensome as to 
be unreasonable requires balancing the statute's bias in favor 
of member access to records against the costs of the inspection 
to the company.  When applying this balancing test, a number of 
factors may be relevant, including, but not limited to:  (1) 
whether the request is restricted by date or subject matter; (2) 
the reason given (if any) for the request, and whether the 
                                                 
18 As noted, the statute requires that the member shoulder 
the 
costs 
of 
inspection. 
 
See 
Wis. Stat. § 183.0405(2) 
(providing a member may "inspect and copy" LLC records "at the 
member's own expense").  However, we observe that other costs, 
including labor and other indirect costs, may result from a 
member inspection request.  Expenses incurred litigating an 
inspection request are not among those that may be factored into 
the reasonableness analysis.   
No. 
2005AP995   
 
37 
 
request is related to that reason;19 (3) the importance of the 
information to the member's interest in the company; and (4) 
whether the information may be obtained from another source.  
¶69 In the event that an LLC inspection request comes 
before a circuit court, the court within its discretion will 
take into account these purposes when determining whether an 
inspection request is reasonable under Wis. Stat. § 183.0405(2), 
provided the operating agreement does not require a different 
analysis.  A circuit court's determination of the reasonableness 
of a member's request will depend on the circumstances of the 
case. 
 
Decisions 
of 
the 
circuit 
court 
regarding 
the 
reasonableness of an inspection request are addressed to its 
discretion. 
E 
¶70 Doral Dental contends that Marie's requests of July 
2004 to inspect e-mails and draft documents were "unreasonably 
broad."  The requests stated as follows: 
17. 
For 
years 
2001 
to 
the 
present, 
e-mails 
by/to/from Greg Borca, Craig Kasten or Lisa 
Sweeney. 
                                                 
19 We note that while Wis. Stat. § 183.0405(2) does not 
require that a member's inspection request be made for a "proper 
purpose," the reason for the request may be a relevant factor in 
determining 
whether 
the 
request 
is 
reasonable 
under 
§ 183.0405(2).  Thus, a request that is made for an improper 
purpose may well be unreasonable.  However, for a request to 
meet the reasonableness requirement, the requester need not 
always show that the request was submitted for a "proper 
purpose," or even give a reason for the request.   
No. 
2005AP995   
 
38 
 
18. 
All internal correspondence between the officers 
and 
directors 
of 
Doral 
(e-mail, 
memo 
or 
correspondence) for the years 2001 to the 
present.  
Doral Dental also argues that because Marie's actual requests 
were not limited to any stated concern, we should conclude that 
they were unreasonable under Wis. Stat. § 183.0405.   
 
¶71 As noted, a member's inspection request need not 
necessarily be tied to a stated concern of the member to be 
reasonable.  However, the question of whether a specific 
inspection request is reasonable under the WLLCL and the 
operating agreement is a question for the circuit court, 
applying the legal standards set forth above. 
¶72 Additionally, the parties dispute whether servers and 
computer equipment formerly owned by Doral Dental and now in the 
possession of DQV may be subject to an inspection request under 
the WLLCL.  Doral Dental contends that no provision of the WLLCL 
or the operating agreement permits members to inspect items now 
in the possession of third parties.  Doral Dental states the 
circuit court made a finding of fact "that Doral sold the 
servers at issue" and that this finding was supported by a 
representation of Doral Dental's counsel in open court.  Doral 
Dental asserts that the finding is also supported by the fact 
that Marie subpoenaed e-mails from DQV.  Marie counters that a 
rule prohibiting member inspections when records are no longer 
in the possession of the company would result in companies 
simply selling or disposing of servers when they wished to avoid 
an inspection.  She further states that the circuit court did 
No. 
2005AP995   
 
39 
 
not make a factual finding that the servers that were sold to 
DQV were the only source of the information she seeks. 
¶73 We note that nothing in the WLLCL nor the operating 
agreement prevents Marie from seeking information contained on 
computer equipment now in the possession of a third party.  That 
is what Marie did here, obtaining a subpoena to make electronic 
copies of computer hard drives and servers in DQV's possession.  
¶74 Regardless, to the extent that these issues arise 
before this court as a result of the circuit court's order 
denying Doral Dental's motion for a protective order, they are 
not properly before us because Doral Dental has not filed a 
petition for cross-appeal seeking review of the order.  See 
Wis. Stat. § (Rule) 809.10(2)(b) ("A respondent who seeks a 
modification . . . of another judgment or order entered in the 
same action or proceeding shall file a notice of cross-
appeal.").   
¶75 Whether the information Marie seeks may be available 
on other electronic equipment not sold to DQV, and whether Doral 
Dental made a reasonable effort to discover such information on 
any such equipment are issues for the circuit court. 
¶76 Additionally, Doral Dental objects to Marie's request 
to inspect e-mails on grounds that they may contain privileged 
medical information, noting that Doral Dental's business is 
developing systems to manage health care information.  Marie 
responds that this argument is a red herring because the Health 
Insurance Portability and Accountability Act regulations already 
require that Doral Dental segregate such information.  We cannot 
No. 
2005AP995   
 
40 
 
determine on the record before us whether Doral Dental's concern 
is well-founded, and leave for the circuit court to resolve this 
issue, if necessary, on a more fully developed record. 
IV 
¶77 In summary, we conclude that Doral Dental's operating 
agreement, which provides access to "Company documents" as well 
as "records," grants a right of inspection that embraces 
document drafts and some company e-mails.  We therefore conclude 
that the circuit court's order denying inspection of company e-
mails on grounds that they were, categorically, not "Company 
documents" was in error.  
¶78 Additionally, 
we 
construe 
the 
language 
"upon 
reasonable request" included in Wis. Stat. § 183.0405(2) and the 
operating agreement to pertain to the financial burdens a 
request may place upon the company, as well as the timing and 
form of inspection.  We conclude that the reasonableness inquiry 
seeks to weigh the statute's bias in favor of the member's right 
of inspection against the burden the specific request may place 
upon the company.  
¶79 We therefore reverse the circuit court's orders 
denying Marie Kasten's request to inspect e-mail and document 
drafts 
and 
dismissing 
her 
declaratory 
action 
on 
summary 
judgment.  We remand this matter to the circuit court to 
reconsider Marie's request of July 2004 to inspect e-mails and 
document drafts in a manner consistent with this opinion.   
 
By the Court.—Reversed and cause remanded for further 
proceedings consistent with this opinion.   
No. 
2005AP995   
 
41 
 
 
¶80 Justice N. PATRICK CROOKS did not participate. 
 
 
No. 
2005AP995   
 
 
 
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