As you know, we often focus on issues related to personal liability on this blog. In our multi-post blog series on personal liability of business owners, for example, we discussed types of business entities designed to protect business owners from business debts and liabilities. In our multi-post blog series on corporate veil piercing, we looked at situations where courts “pierce the corporate veil” to hold LLC members liable for business debts, and in another multi-post blog series on single-member LLCs and creditors’ rights, we looked at situations where single-member LLCs had no charging order protection in the context of bankruptcy.
But can you, as a corporate officer, be held personally liable for your corporation’s misdeeds? The short answer is, it depends.
In a recent New York case, Public Sector Pension Investment Board v. Saba Capital Management, L.P., a corporate officer was personally named in the lawsuit because he allegedly acted in his own personal interest.[1] The case involved an alleged breach of contract and fiduciary duty in connection with a valuation of certain investment assets.
This post was part of a two-part series on the liability of corporate officers under New York law. You can find the other post by searching our blogs at www.mcbrideattorneys.com. In our next post, we will discuss the details of the case.
[1] See generally Pub. Sector Pension Inv. Bd. v. Saba Capital Mgmt., L.P., 2016 N.Y. Slip Op. 30215(U) (N.Y. Sup. Ct. Feb. 8, 2016). Unless otherwise noted, all references to the case are from this citation.
This posting is intended to be a planning tool to familiarize readers with some of the high-level issues discussed herein. This is not meant to be a comprehensive discussion and additional details should be discussed with your transaction planners including attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. This article should not be treated as legal advice to any person or entity.
Steps have been taken to verify the contents of this article prior to publication. However, readers should not, and may not, rely on this article. Please consult with counsel to verify all contents and do not rely solely on this article in planning your legal transactions.
[1] See generally Pub. Sector Pension Inv. Bd. v. Saba Capital Mgmt., L.P., 2016 N.Y. Slip Op. 30215(U) (N.Y. Sup. Ct. Feb. 8, 2016). Unless otherwise noted, all references to the case are to this citation.