The trial court’s dismissal of the LLC’s claim against its broker was affirmed because the LLC failed to file its tax return and its status as an LLC was forfeited. 1201 W. Cross Street, LLC v. Gray Ins. Group, Inc., 2025 Md. App. LEXIS 858 (Md. Ct. App. Oct. 8, 2025).

1201 W. Cross Street, LLC (Cross Street) employed Gray Insurance Group to broker insurance for the LLC’s property. Cross Street and Gray continued their business relationship for years with Gray notifying Cross Street when it was time to renew its property insurance.

On October 3, 2022, The Maryland State Department of Assessments and Taxation listed Cross Street as “forfeited” and “not in good status” for failure to file property returns for the 2021 tax year. On September 11, 2023, while Cross Street remained forfeited, it filed the underlying complaint, claiming that Gray fialed to notify it that its property insurance had lapsed. Gray filed a motion to dismiss or, in the alternative, for summary judgment, arguing that Cross Street lacked standing to initiate the lawsuit because it was a forfeited LLC.

Cross Street then filed its missing property return, thereby reviving its ability to do business. Cross Street responded to Gray’s motion, arguing that its “”temporary forfeiture” did not impact its standing to initiate the lawsuit. The circuit court dismissed Cross Street’s complaint with prejudice. Cross Street appealed.

The appellate court affirmed. There was no Maryland authority holding that an insurance broker could owe either a negligence-based or contract-based duty to a forfeited LLC with which the broker had previously conducted business. Entering into a new contract on behalf of an LLC was not winding up affairs for purposes of the Maryland statute. Cross Street did not demonstrate that Gray owed it any common law duty while forfeited. Because the complaint stated no legally cognizable action, the circuit court did not err in dismissed Cross Street’s suit with prejudice.