The action the Attorney General recently brought against not only Lehman Brothers Holding Inc., but also its executives and directors, serves to remind us that the cloak of limited liability does not always shield the individuals through whom a corporation or limited liability company acts. By conducting their businesses as corporations or LLCs, shareholders and members erect a metaphorical wall, subject to the doctrine of veil piercing, which protects their personal fortunes from liability for the torts and contracts of the enterprise. The potential for personal liability of directors, officers, managers and employees (each hereafter a “Corporate Agent”) is, however, distinct and separate from that of the shareholders or the members and is not limited to veil piercing. Donsco, Inc. v. Casper Corp ., 587 F.2d 602, 606 (3rd Cir. 1978). In Milgram v. Comfort Direct, Inc., (unreported), Docket No. A-0360-07T2 (App. Div. 2008), the court said:
A judge is not required to pierce the corporate veil in order to enter judgment against a corporate officer where, as here, that officer personally engages in unlawful activity under [the Consumer Fraud Act].
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