Articles Posted in Corporate Law

Underwood-Blog-Images-2-300x300No. In California, individuals often hide behind “corporations” that consist of a single shareholder. In so doing, they protect themselves from liability by utilizing a corporate form. This can be especially frustrating in lawsuits.

Often, a plaintiff will receive a judgment in their favor, only to find the corporation they’ve sued has magically become bankrupt, unable to satisfy their debts. California law provides a remedy for this instance, called “piercing the veil.”

But sometimes, the situation is reversed, and an individual cannot satisfy their debts. In some states, courts allow creditors to reverse pierce the veil and seize the corporate assets owned by the individual shareholder. California does not allow this, as the courts see it as a hasty and inadequate solution for which other remedies already exist.

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