Am I responsible for a suit that has been filed against a corporation where I am also named in the suit?

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Am I responsible for a suit that has been filed against a corporation where I am also named in the suit?

I joined a public (pink sheets) corporation just over a year ago; one month prior to my joining, an agreement was signed to raise capital (the suit is based on this agreement.) I have no shares and I do not receive any compensation for my efforts. My title is CTO (officer) and Director (board member). I donated my time to this corporation to gain experience. Now I was just named in a lawsuit against the corporation – where the corporation did not convert shares to the company filing the suit for a previous loan agreement. I resigned months ago, am I responsible now?

Asked on February 6, 2012 under Business Law, Texas

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

You need to seek help from an attorney in your area on this matter as soon as you can. The terms of your agreement with this company need to be reviewed as well as the terms of the agreement that is the cause of the suit.  You need to check out if your "employment" included a defense and indemnification in the lawsuit. It should have but you need your own attorney here to protect your interests and make sure that you are dismissed from the case early on if warranted.  Good luck.  


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