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Mirowski when she formed and funded MFV was the substantial gift
tax for which she would be liable with respect to her contem-
plated respective gifts of 16-percent interests in MFV to her
daughters’ trusts. We have also found that at no time before Ms.
Mirowski’s death did the members of MFV have any express or
unwritten agreement or understanding to distribute assets of MFV
in order to pay that gift tax liability. In order to pay the
anticipated gift tax liability with respect to her contemplated
respective gifts of 16-percent interests in MFV to her daughters’
trusts, Ms. Mirowski could have (1) used a portion of the over
$7.5 million of personal assets that she retained and did not
transfer to MFV, including cash and cash equivalents of over $3.3
million, (2) used a portion or all of the distributions that she
expected to receive as a 52-percent interest holder in MFV of the
millions of dollars of royalty payments under the ICD patents
license agreement that she expected MFV to receive, and
(3) borrowed against (a) the personal assets that she retained
and did not transfer to MFV and (b) her 52-percent interest in
MFV,48 see Md. Code Ann., Corps. & Assns. sec. 4A-602 (West
48Under applicable Maryland law, the interest of a member in
an LLC constitutes personal property, Md. Code Ann., Corps. &
Assns. sec. 4A-602 (West 2008), and the term “security interest”
is defined as an interest in personal property that secures
payment or performance of an obligation, Md. Code Ann., Com. Law
sec. 1-201(37) (West 2008). Thus, under applicable Maryland law,
a member of an LLC may grant an interest in that member’s inter-
est in the LLC in order to secure payment of a loan.
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Last modified: March 27, 2008