tim <fincadenada@yahoo.com> wrote:
I am a 30% minority shareholder in an LLC. The majority
shareholder is another (parent) company that is wholly owned by a
family and entirely controlled and micromanaged by the family
patriarch and manager of of both the LLC and the parent company.
This manager has solely controlled the parent company's fraudulent
actions (under the veil of being the manager) diverting funds &
patents to his family and his family's (parent) company. As a
result of his actions the LLC is now about $5 million in debt to
the parent company and lost several good business opportunities.
These actions seem to be covered under our arbitration agreement
even though they were technically enacted by the parent company
(by the manager). Is there any possibility of piercing the
corporate veil and suing the manager in court for fraud, damages,
etc..? Help!
The manager is always liable for his own torts. Under state law he may
also have a fiduciary duty to other LLC members to manager the business
of the LLC is a reasonable way and for the best interests of the
members. If he doesn't do that, I think he is personally responsible
for the damages incurred by other members.
Stu
