Personal Liability

News & Analysis as of

Recent Remarks By Officials Reinforce DOJ’s Focus On Criminal Fraud Investigations And Prosecutions Of Culpable Individuals

In a trio of speeches given at separate events on September 17, 2014, Department of Justice (“DOJ”) officials announced new initiatives and points of emphasis in the Government’s ongoing efforts to hold corporations and...more

Ninth Circuit Holds That "Tag Jurisdiction" Does Not Apply to Corporations - The Court's Decision Limits Personal Jurisdiction...

Following closely on the heels of the U.S. Supreme Court's landmark personal jurisdiction decision in Daimler AG v. Bauman, the U.S. Court of Appeals for the Ninth Circuit has issued a decision that further reinforces the...more

Social Host And Server Liability

The intoxicated person is over-served. Whether hosting a house party or tending bar at a public place, serving alcohol to a visibly intoxicated person is illegal. It is appropriate to seek compensation from not only the drunk...more

Criminal Conduct and Corporate Liability

Some blame a general quest for the almighty dollar, others, a decline in moral fiber, but white-collar crime has been around as long as commerce itself, or at least as long as there have been white collars. The film "The Wolf...more

"Federal Circuit Decision Underscores the Importance of Customs Compliance for All Parties to an Import Transaction"

A decision issued last week by the U.S. Court of Appeals for the Federal Circuit in United States v. Trek Leather, Inc. has shaken fundamental assumptions held by many U.S. importers and their business partners (including...more

Customs Litigation: Federal Circuit Decision In United States v. Trek Leather Broadens Personal Liability For Penalties Under 19...

On September 16, 2014, the U.S. Court of Appeals for the Federal Circuit issued its en banc decision in United States v. Trek Leather, Inc. No. 2011-1527, 2014 U.S. App. LEXIS 17746 (Fed. Cir. Sept. 16, 2014). The decision is...more

Speech by DOJ’s Marshall Miller Could Be Harbinger of Bad Things to Come

So here’s a thing. Last week Marshall Miller, the No. 2 official in the Justice Department’s Criminal Division, made a speech urging corporations to focus its investigations into misconduct on individual malefactors and...more

Introducing Personal Liability Into Corporate Negligence: An Analysis of the Trek Leather Decision

Are you an owner or officer of a small or midsize business? An import or trade compliance professional? Someone whose job responsibilities include some aspect of the process of importing merchandise into the United States,...more

Investment Firm Fined $15 Million for Cherry Picking and Soft Dollar Schemes

An investment firm's plan to defraud clients out of $10.9 million landed it a $15 million penalty from the U.S. Securities and Exchange Commission (SEC). On top of the penalty, the firm must disgorge — or give up the profits...more

Court of Appeals for Federal Circuit (CAFC) Issues Decision In U.S. v. Trek Leather – Corporate Officer Held Liable

Yesterday, the CAFC issued its en banc decision in the U.S. v. Trek Leather case. The Court held the President of the company liable for gross negligence due to his own actions, even if he is an agent of the company....more

Do Not Pass Go: Federal Judge Orders Execs Jailed for Contempt of Recall Order

A recent federal decision has made clear that court-ordered recalls can have real teeth, not just for manufacturers but also their officers—especially when the court has reason to suspect a company’s execs are deliberately...more

SEC Sends A Message — To Executives And Their Companies

In October 2013, SEC Chair Mary Jo White gave a speech at the Securities Enforcement Forum in which she declared an “enforcement mission” of the SEC to be implementation of the “broken windows” theory of crime deterrence...more

“Culture of Compliance” Urged by FinCEN

Following months of rumors that the Financial Crimes Enforcement Network (FinCEN) is preparing to impose personal liability on officers, directors and employees for shortcomings in their financial institutions’ Bank Secrecy...more

Personal Responsibility for PA Tax Assessments

Under Pennsylvania law, there are important exceptions to the general rule that officers, employees and owners of a corporation or limited liability company have no personal liability for the business’s unpaid tax...more

Reminder: Just Being Incorporated Isn’t Enough

Being incorporated isn't enough for a construction company to keep its assets protected. As a contractor or subcontractor you need to keep up the corporate formalities to avoid the possibility of personal assets being on the...more

LLC Managers Beware: Get Involved With Member Distributions By an Insolvent LLC and You May Be Personally Liable

A chapter 7 trustee sued a manager of three limited liability company (LLC) debtors for breach of fiduciary duty and to hold the manager personally liable for distributions made to members, including himself....more

Personal Liability In Business Ownership/Operation

Common practice for well advised business owners is to operate the enterprise through a chartered corporation or other limited liability entity recognized in the state(s) in which the business will be operated. The main...more

Idaho Real Estate & Development Law Update: Lack of Corporate Formalities Will Not Destroy the Limited Liability Protection...

In the case of Wandering Trails v. Big Bite Excavation released June 18, 2014, the Idaho Supreme Court clarified the requirements for piercing the veil of a limited liability company or LLC and thereby imposing liability on...more

Individual Responsibility under the ACA

Effective 2014, if a taxpayer is not covered under minimum essential coverage for one or more months, then, unless an exemption applies, the taxpayer is liable for the individual shared responsibility payment on his return. ...more

Georgia Supreme Court: Business Judgment Rule Valid, But Bank Officers Can Still Be Liable

In the context of Federal Deposit Insurance Corporation (FDIC) litigation against the former directors and officers of a failed bank, the Georgia Supreme Court has upheld the validity of the business judgment rule in the...more

Pin the Blame on the Corporate Officer: Senators Introduce Hide No Harm Act

Three Senate Democrats recently introduced a bill that seeks to hold company executives of a product maker or seller criminally liable for knowingly "failing to inform and warn of serious dangers" associated with a product....more

Business Judgment Rule in Georgia: Not a "Get Out of Jail Free Card" for Officers and Directors

The Georgia Supreme Court has adopted the Business Judgment Rule with a very important nuance that requires officers and directors to not only be prepared when making their decisions but to document their preparations in...more

Doing Business in Canada: Directors' Liabilities

DIRECTORS’ LIABILITIES - In Canada, there is a legal duty for every director and officer of a corporation to act honestly and in good faith with a view to the best interests of the corporation when exercising his/her...more

Chancery Court Provides Additional Room for Shareholders Challenging Change of Control Transactions

What you need to know: In its recent decision in Chen v. Howard-Anderson, Delaware’s Court of Chancery held that directors and officers may be found to have acted in bad faith, thereby breaching their fiduciary duty of...more

Individual Liability: What’s Behind The Headlines?

It’s been open season on financial institutions since the 2008-2009 financial crisis (“Financial Crisis”). State and federal prosecutors and regulators are competing with each other for press coverage of their latest consent...more

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