January 20, 2018

Colorado Supreme Court: Corporate Veil Properly Pierced to Impose Attorney Fees on LLC Manager

The Colorado Supreme Court issued its opinion in Stockdale v. Ellsworth on Monday, December 18, 2017.

Corporations—Piercing the Corporate Veil—Attorney Fees—Joinder.

The Colorado Supreme Court reversed the Colorado Court of Appeals’ opinion vacating the trial court’s judgment awarding attorney fees. The court held that the trial court properly pierced the corporate veil to impose joint and several liability on a limited liability company’s managing member for attorney fees. The court also held that the managing member was properly joined as a party to the litigation, and that imposing such liability did not violate the managing member’s due process rights under the circumstances of this case.

Summary provided courtesy of Colorado Lawyer.

Colorado Supreme Court: Test Enunciated to Determine Personal Jurisdiction for Non-resident Company Based on In-state Contacts

The Colorado Supreme Court issued its opinion in Griffith v. SSC Pueblo Belmont Operating Co. on Monday, September 26, 2016.

Constitutional Law—Personal Jurisdiction—Corporations and Business Organizations—Related or Affiliated Entities.

The Colorado Supreme Court held that, to exercise personal jurisdiction over a nonresident parent company based on the in-state contacts of its resident subsidiary, a trial court shall perform the following analysis: First, the trial court shall determine whether it may pierce the corporate veil and impute the resident subsidiary’s contacts to the nonresident parent company. If so, the court shall analyze all of the nonresident company’s contacts with Colorado, including the resident subsidiary’s contacts, to determine whether exercising either general or specific personal jurisdiction over the company comports with due process. Conversely, if the trial court concludes that it may not pierce the corporate veil, it shall treat each entity separately and analyze only the contacts that each parent company has with the state when performing the personal jurisdiction analysis. Here, because the trial court did not perform this two-step analysis when it determined that petitioners were subject to personal jurisdiction in Colorado, the court made its rule to show cause absolute.

Summary provided courtesy of The Colorado Lawyer.