August 19, 2010
On August 16, 2010, the Colorado Supreme Court granted a Petition for Writ of Certiorari filed by BHGR in one of its business law cases. As a result, Colorado's highest Court will consider and decide the following issues which will create new state law precedent:
Issue 1: Whether the creditors of a limited liability company have standing to sue individual members of the LLC who have allegedly received an unlawful distribution under section 7-80-606, C.R.S. (2009), the Colorado Limited Liability Company Act.
Issue 2: Whether the court of appeals erred in extending the limited common law fiduciary duty which directors of insolvent corporations owe to an insolvent corporation's creditors to managers of LLCs.
A Petition for Writ of Certiorari is the legal mechanism for requesting the Colorado Supreme Court to review a case. With a few exceptions, the Supreme Court hears only those cases it chooses to hear and it is estimated that only 1 in 14 Petitions for Certiorari filed with the Court is accepted for review. Partners Giovanni Ruscitti of BHGR's Business Law group and Heidi Potter of BHGR's Appellate Law group are handling the appeal with the assistance of Associate Jack Storti.
For more information concerning this issue, you may download an in-depth article written by Herrick K. Lidstone, Jr. and published in The Colorado Lawyer, August 2010, Vol. 39, No. 8.