Scammed by Larocco... Anyone else? - Page 2

I believe Tomo buys Xin amps and sells them in Asia. He is a nice guy and bought my Xim SuperMacro III v3 a while back, and I noticed he buys a lot of them.

1) Because the owner(s) have quite likely already taken all of the money out of the legal entity for themselves.

2) It depends upon the form, but in general yes.

I have been in the business of collecting money for over 30 years. I have seen this scenario play out a thousand times. I don't know the exact details of this circumstance obviously, but I am willing to bet that Larocco is now a worthless shell entity.

So now we are back to setting his lawn on fire.

Claim < 5000 = small claims court (at least, I think that's what the limit is). Wouldn't it be worth the small fee to play out the scenario and see if the owners made a mistake? Or is setting up a shell company such an easy thing that it can be done with little fear of making a mistake that would allow for personal liability to attach, e.g., fraudulent misrepresentation (which I imagine would allow for personal liability to attach despite normal corporate insulation), Partnership instead of LLP, etc.? (This is a serious question--I really don't know how easy it is for a person to makeup a company, take someones money, empty out the company, and still avoid all sorts of loopholes (if there are any) at getting at the person's personal assets).

5000 or 500?

to the OP,
read post #14 from this thread:

http://www.head-fi.org/forums/f11/la...91/index2.html

there may be a member that can help you out.

I give up. If my previous posts don't answer this, I really can't help you. May we have the next contestant, please?

That's fine.. I really was just trying to get to the bottom of it. An owner of a bankrupt company is treated much differently than an owner of a company who engaged in tortious, e.g., fraud, conduct within his capacity as owner. The former is, in most cases, only touchable so far as the company's assets exist; the latter has no such protection.

At least this is my understanding of the law..

"The specific direction or sanction of, or active participation or cooperation in, a positively wrongful act of commission or omission which operates to the injury or prejudice of the complaining party, is necessary to generate individual liability in damages of an officer or agent of a corporation for the tort of the corporation." AMJUR Corporations § 1629, Rights, Duties, and Liabilities of Directors, Officers, and Employees: Generally

"If the corporation is a mere instrumentality or alter ego of the shareholder, the corporate entity will be disregarded, and the individuals owning the stock and the corporation treated as identical, with the result that such individuals will be personally liable for the acts and obligations of the purported corporation. The limitation of liability to the corporate assets must give way to imposition of personal liability if the actions of those in control of the corporation denigrate the purpose of limited liability, which is to encourage investment of risk capital . . . Corporate creditors may reach unpaid stock subscriptions, and if a corporation is liquidated, the shareholders are liable if, otherwise, they would be unjustly enriched by retaining assets of the corporation free from the debts of the corporation." AMJUR Corporations § 728, Exceptions to Rule Against Liability; Theories or Bases of Liability

**Not a lawyer, just a law student. Not giving legal advice, just suggesting that, if the story is true, it may serve to look into it more--3000$ is no small bit of change.**

I would guess it depends on the state. In CA, I believe, the limit is 7000$.

With respect to number 2, it depends on the causes of action you are asserting.

Officers and directors of corporations are generally shielded from contractual liability for contracts entered into in their representative capacity on behalf of the entity.

By contrast, officers and directors who perpetrate a tort (fraud, personal injury, etc) through their corporation are generally personally liable, at least under California civil law.

Other forms of business associations like dba's and partnerships do not shield individuals from personal liability.

Any idea how many other people were taken in by this scam? If there are enough to bring it as a class action, it might be worth talking to a consumer class action attorney/seeking out a contingency fee arrangement. Otherwise, a pro per action in small claims court is really your only option.

Do we know what happened to Larocco? I've been away from the scene for a while (few years). Very surprised to learn this. I had no problems with Larry ever.