During a business breakup or dissolution, financial liabilities sometimes follow the shareholders or directors of the former corporation. In certain circumstances, a judgment creditor may seek to hold these individuals or entities liable under an alter ego (piercing the corporate veil) theory.
There have been some interesting developments regarding piercing claims in the last few years, including recent cases underscoring:
- That a piercing claim can attach to anyone, including non-shareholders without any formal corporate title whatsoever, so long as the elements are met (Buckley v. Abuzir).
- That a creditor pursuing an alter ego theory based on a breach of contract judgment must allege and prove fraud (Saletech v. East Balt).
There have also been academic studies showing that successful piercing claims are not nearly as rare as people think.
The seminar will provide an overview of common issues encountered when a client wants to dissolve a business, including filing requirements, IP rights, and personal and business liabilities. To register, visit IICLE.