I have the impression the situations where that actually happens are at least arguably serious misconduct, and usually targeted at someone with significant assets.
A construction company that pockets ten million dollars and doesn't build anything probably can't shield its owner this way, but a single-developer software consultancy that pockets ten thousand dollars and delivers buggy code can.
In theory it’s based on whether the owner of the company intended to run it under capitalized in an effort to shirk liability.
But the larger point still stands: Limited liability was granted “on the front end” without the entity needing to demonstrate a minimum amount of capital. You’re only pointing out that in the U.S. that it’s possible that “on the back end” the owners of the entity might become personally liable.
Yes, i’m just elaborating on OP’s point. The US system is different and basically more optimistic on the front end.
Much the same in the UK. Usually some kind of fraud or failing to stop trading when it was obvious insolvency was unavoidable. No minimum capital requirements either.
Thats cause the software and computing industry early on, disclaimed all liability.
"Computers are hard, yo!". It devalues the profession.
And I thought no liability was bad enough... But no. Now its LLMs and " for entertainment purposes only". I take it management and leadership also read that, and don't give one fuck.
The ability to build reliable software has existed for a long time. Commercial airlines make heavy use of it, and serious failures are vanishingly rare.
The problem is building software to those standards of reliability is expensive and slow. Consumer software never justifies it. Business software rarely does. If you want me to accept liability for the consequences of bugs in code I write, I'm giving you a schedule five times as long and a price twenty times as high.
>Commercial airlines make heavy use of it, and serious failures are vanishingly rare.
Is this a joke? There's a major outage effecting flights at least yearly. The Delta one is from May...
[1] https://en.wikipedia.org/wiki/2022_Southwest_Airlines_schedu... [2] https://www.usatoday.com/story/travel/airline-news/2026/05/0...
The OP is talking about the software onboard airplanes, not the operational software used by airlines.
They should have said aircraft manufacturers, not airlines, but it’s clear what they meant.
While extreme cases are the easiest to imagine, in real life the plaintiff almost always argues to pierce the veil and the defendant always argues the opposite, and both sides earnestly believe that they are right.
And in real life piercing the veil is extremely exceptional
It's so exceptional in the UK you can run a series of fraudulent businesses which are incorporated, "buy" services, don't pay for them, then declare themselves insolvent, rinse and repeat, and there's a fair chance you'll get away with it.
It's called phoenixing. There are good few bans for it every year, but almost no convictions for fraud.
Not to mention all the fraud the Turkish barbers etc are up to
Yeah but the veil doesn’t get pierced that’s super rare, which is more important than everyone’s emotional state.
Not in the US it’s not. LLCs don’t shield your assets from personal negligence. So if you have a single member LLC with no employees (very common), an awful lot of what prompt a successful suit will be because of negligence on your part.