Dive Brief:

• Forming a limited liability corporation is a popular tactic for protecting personal assets from claims against professional work, but the protection can be attacked in hopes of undoing it.
• Contractors and others who operate as LLC's need to keep it clear that it is the corporation for which they are acting and not slip into being perceived as acting personally, such as in letters.
• It also is critical to keep personal and corporate funds separate if the assets of the corporation "members" are going to have the protection they wanted when a claim is made some day.

Dive Insight:

The process of legally trying to get at personal assets to satisfy claims against the LLC is called piercing the veil, and it's not an unusual tactic. Finding a chink in an opponent's armor is a basic strategy, after all. There was a case recently in which a contractor had formed an LLC but was personally doing work that a customer later claimed was negligent. That case, in Louisiana, went to the state Supreme Court as the customer argued that the LLC shield should not apply in a case of what he claimed was negligent work.