- It cannot be proven that the CEO had prior knowledge of the product's defects.
- The defect is caused by the manufacturer.
Ethics / Professional Responsibility Lawyer
If the company is a corporation, the CEO would not be personally liable except in very rare and extraordinary circumstances.
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Criminal Defense Attorney
If the distributor is an LLC, he or she is very unlikely to be held personally liable. However, there are some instances where an officer or owner of a corporation can be held liable for tortious actions of the company. I suggest that the CEO seek legal counsel with more specific facts to protect from possible exposure.
This answer is intended to be used for general purposes only; it does not create an attorney-client relationship.
As a general rule, one of the legal advantages of a corporation as opposed to a partnership or sole proprietorship is that owners and executives of the corporation can only be held liable for their own acts, not the acts of their employees. This is what is meant by the "corporate shield."