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Can an LLC be dissolved if it is in the process of being sued?
Los Angeles, CA
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Posted about 1 month ago in Limited Liability Company (LLC)
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Can an LLC be dissolved if it is in the process of being sued? Also, what protection is afforded the members of the LLC in the event that the LLC is sued?
Additional information
No we do not have insurance to defend the LLC and its members. Are we still ok? My thought was since we've gone out of business and the LLC has no tangible assets it serves no purpose to keep it in tact. With the exception of the line of credit which I personally guaranteed, I figure the remaining debt will disappear with the dissolution of the company. Am I correct in assuming this? Long story short, I'm looking for the best exit strategy possible. Answers (2)
Steven Alan Fink
This attorney is licensed in California.
Posted about 1 month ago.
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It can be dissolved. The members of the LLC are generally not liable for the debts of the LLC except to the extent they receive assets of the LLC in the dissolution or signed personal guarantees. Does the LLC have insurance to defend the LLC and its members?
The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. 
Henry Daniel Lively
This attorney is licensed in California.
Posted about 1 month ago.
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It has been my experience that most attorneys will try to sue the individuals of an LLC in Ca on an alter ego theory, in the same manner as they would attack the shareholders of a corporations.
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