What to do if I have been personally named in a lawsuit stemming from my former employment?

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What to do if I have been personally named in a lawsuit stemming from my former employment?

My former employer is now defunct and all assets have been sold to another company. I worked for a self-directed IRA custodian. Account owners for self-directed IRAs are solely responsible for selecting and monitoring their financial advisors and investments. We had a client who was scammed out of $360k because he invested in a private placement orchestrated by a Madoff-type crook. Along with my former employer, I have been named in the lawsuit because my signature was on the administrative review paperwork. I own nothing and earn about $30k a year. Does it sound like the case has merit? Should I speak with a litigation attorney? In Denver, CO.

Asked on August 20, 2011 Colorado

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

First you need to retain an attorney to represent you in the lawsuit. This lawyer need to contact plaintiff's counsel regarding your representation and the need to tender your defense to the presumed errors and omissions insurance carrier for your former employer that was in effect when you were an employee and when the plaintiff was allegedly damaged.

Hopefully there is insurance coverage in place and if so, most likely your willl be assigned defense counsel through this insurance carrier to defend and indemnify you concerning the claims against you in the lawsuit at no cost to you. The fees that are charged by your private attorney initially retained might be reimbursed by the insurance carrier if there is a policy in effect and coverage for the claims.

Contact an attorney right away to assist you.

Good luck.


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