Olmstead Stops at the State Line.

The rule itself is real enough. In Olmstead v. FTC, 44 So.3d 76 (Fla. 2010), the Florida Supreme Court held that the charging-order limitation — which ordinarily confines a member’s creditor to a right to distributions, and nothing more — does not protect the sole member of a company. With no innocent co-member to shield, the Court reasoned, the creditor may reach the interest directly. The legislature answered by codifying the result. Section 605.0503(4), Florida Statutes, now provides that where distributions under a charging order “will not satisfy the judgment within a reasonable time,” a creditor of “the sole member of a limited liability company” may obtain the sale of that interest at a foreclosure sale.

Every operative word of that remedy is addressed to “a limited liability company.” In an ordinary statute the phrase would pass without notice. In this one it is the hinge of the whole question, because the Act does not use those words loosely. It defines them.

Section 605.0102(36) does not merely define “limited liability company” to mean a domestic entity — one “formed or existing under this chapter.” It writes an express exclusion into the definition itself, telling the reader that the term carries that domestic meaning everywhere “except in the phrase ‘foreign limited liability company.’” One could hardly ask for a plainer instruction. When § 605.0503 speaks of “a limited liability company,” the definition supplies the meaning: an entity formed under Chapter 605 — a Florida company.

A company organized elsewhere is a different statutory creature. Section 605.0102(26) defines a “foreign limited liability company” as one “formed in a jurisdiction other than this state.” The Act uses that defined phrase deliberately and often — an entire part of the statute, governing the registration and governing law of out-of-state companies, is written in its terms. The legislature plainly knew how to say “foreign limited liability company” when it meant to reach one. In § 605.0503 it did not. The omission is not an oversight to be repaired by construction; under the ordinary canon that the expression of one thing implies the exclusion of another — and under the Act’s own express carve-out — it is a choice. The Olmstead foreclosure is a remedy for Florida companies.

If the negative inference left any doubt, the Act resolves it affirmatively. Section 605.0901, titled “Governing law,” provides that the law of the jurisdiction under which a foreign limited liability company exists governs “the organization and internal affairs” of the company and “the liability of a member as member.” This is the internal affairs doctrine, codified — the settled choice-of-law principle that the internal ordering of a business entity answers to the law that created it.

The significance is structural. Florida has not merely declined to extend its Olmstead remedy to companies formed abroad; it has affirmatively directed that the internal affairs of such a company, and the rights of a member as member, are governed by the company’s home law. What a member’s personal creditor may do to that member’s interest lies at the heart of what the doctrine commits to formation law. A Wyoming, Nevada, or Nevis company is, on this question, a creature of Wyoming, Nevada, or Nevis — by Florida’s own command.

Candor requires confronting the decision that points the other way, because a creditor will cite it first. In Wells Fargo Bank, N.A. v. Barber, 85 F.Supp.3d 1308 (M.D. Fla. 2015), two banks held a deficiency judgment of some $62 million against a Florida resident, Sabrina Barber. After judgment, she had moved roughly $870,000 into a brokerage account titled in the name of Blaker Enterprises, LLC, a single-member company she had organized in Nevis. The creditors sued to foreclose on, or charge, her interest in Blaker, and to avoid the transfers as fraudulent.

On a motion to dismiss, the court reasoned that a membership interest is intangible property that “accompanies the person of the owner”; that because Barber resided in Florida her interest was situated in Florida; and that Florida law therefore governed the remedy. Having located the interest in Florida, the court applied the LLC Act then in force — former § 608.433(6) — and held that, because Barber was the sole member, the creditors had stated a claim to foreclose her interest in the Nevis company. It is worth being precise about what the ruling is: an order that a claim was adequately pleaded, entered against a judgment debtor of modest means litigating two national banks, in which the argument that follows was never raised.

The flaw is a single, identifiable step. The court treated the conclusion “Florida law governs” as though it were the conclusion “§ 608.433(6) applies.” Those are not the same proposition, and the gap between them is where the case fails. Grant the premise — that an intangible interest follows its Florida-resident owner, so that Florida’s law supplies the rule of decision. It still does not follow that this statute reaches this company.

The Act in force in 2015 defined its terms exactly as the current Act does. Former § 608.402(16) defined “limited liability company” to mean one “organized and existing under this chapter” — a domestic company — while former § 608.402(12) separately defined a “foreign limited liability company.” The subsection the court applied spoke only of “a limited liability company having only one member.” Blaker Enterprises was, by the statute’s own definition, not a limited liability company at all. It was a foreign limited liability company. The remedy the court reached for was, by the plain terms of the chapter that created it, unavailable against the entity before the court.

Choosing Florida as the governing law cannot manufacture a remedy that Florida law withholds. A foreclosure sale of a membership interest is not a remedy that floats free in Florida law, to be applied to whatever interest a court deems locally situated; it exists only in the single-member subsection of the LLC Act, and that subsection operates only on companies organized under the Act. Professor Carter Bishop, who has written most carefully on the subject, called the surrounding choice-of-law tangle a “jurisdictional and governing-law quagmire” for good reason — courts repeatedly conflate the question of which sovereign’s law governs with the distinct question of what that sovereign’s law actually provides.

One further feature of Barber has only grown more pointed with time. The court rested its situs analysis on a contrast between an intangible interest and a tangible corporate stock certificate, a contrast it drew from Sargeant v. Al-Saleh, 137 So.3d 432 (Fla. 4th DCA 2014). But Sargeant was later disapproved by the Florida Supreme Court in Shim v. Buechel, 340 So.3d 507 (Fla. 2022). That shift bears on a court’s reach over a debtor’s foreign assets generally — it does not touch the point that matters here, which is that the Olmstead foreclosure statute never described a foreign company in the first place.

A creditor’s best answer is practical rather than textual: if neither the charging-order nor the foreclosure subsection reaches a foreign company, is a Florida judgment creditor simply left without recourse against a resident’s valuable interest? He is not — and the answer reinforces the reading rather than embarrassing it.

• The company’s own law. Section 605.0901 refers the creditor to the law of the jurisdiction that made the company. If it is a Nevis company, he has the remedy Nevis law affords — a charging order, and no foreclosure. He receives precisely the protection, and the limitation, that attended the interest from the moment it was created.
• Florida’s general execution. Proceedings supplementary under § 56.29, and garnishment, remain available to reach distributions when and as they are made. What that machinery does not contain, anywhere, is authority to order the foreclosure sale of a membership interest. That singular remedy lives only in the LLC Act’s domestic subsection.

So the creditor of a foreign-company member may stand in line for distributions, here or at home, but he may not compel a sale of the interest — not because Florida has opened a loophole, but because Florida, in deference to the law that made the company, never extended its foreclosure remedy that far. It is comity, not evasion.

The proposition is narrow, and it is sturdy. The single-member foreclosure power of § 605.0503(4) operates by its own words on “a limited liability company,” a term the legislature defined in § 605.0102(36) to mean a company “formed or existing under this chapter” and defined expressly to exclude the phrase “foreign limited liability company.” A company organized outside Florida is, by § 605.0102(26), a different thing under the statute, and by § 605.0901 its internal affairs answer to the law that created it. A Florida court cannot deploy the Olmstead foreclosure against such a company without reading a defined term to mean its opposite.

That a single trial court once did exactly that — on a motion to dismiss, against an overmatched debtor, with the argument never raised — does not unsettle the text. It illustrates how easily a court may mistake the question whose law governs for the question what that law provides. No Florida appellate court has adopted that reasoning, and the better reading is the plain one. Olmsteadis real, and for a Florida company it bites — but the reputation stops where the statute does: at the state line.