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Beware Your Alter Ego

Banner of the California Courts, which have written opinions about the alter ego doctrineThis post discusses the alter ego doctrine, particularly as it is applied by courts in California.

The section references below has been updated to reflect California’s new LLC law that took effect on January 1, 2014 (see RULLCA Brings New LLC Laws to California in 2014).

Corporations have existed for centuries. One way they promote economic activity is by allowing stockholders to limit their personal liability for corporate debts to the amount of their individual investments in the corporation (“limited personal liability”). (more…)