Judicial Opinion Ensures NC to Remain Business Friendly: Decision Shields Officers and Directors from Personal Liability


North Carolina’s reputation as a pro-business state received strong backing when the NC Business Court issued a significant 70-page opinion outlining the protections from personal liability afforded to officers and directors of NC corporations. The decision has profound implications for the statewide business community.

The Business Court's decision in State ex rel. Commissioner v. Custard of Insurance openly acknowledges how faulty decision-making by officers and directors of major corporations led directly to the current economic crisis. Nevertheless, the Court concluded that officers and directors cannot be held personally liable for taking on risks they believed in good faith were in the company’s best interests, even if those decisions...

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