§ 17-29-304 — Liability of members and managers

(a) The debts, obligations or other liabilities of a
limited liability company, whether arising in contract, tort or
otherwise:
(i) Are solely the debts, obligations or other
liabilities of the company; and
(ii) Do not become the debts, obligations or other
liabilities of a member or manager solely by reason of the
member acting as a member or manager acting as a manager.
(b) Repealed by Laws 2016, ch. 54, § 2.
(c) For purposes of imposing liability on any member or
manager of a limited liability company for the debts,
obligations or other liabilities of the company, a court shall
consider only the following factors no one (1) of which, except
fraud, is sufficient to impose liability:
(i) Fraud;
(ii) Inadequate capitalization;
(iii) Failure to observe company formalities as
required by law; and
(iv) Intermingling of assets, business operations and
finances of the company and the members to such an extent that
there is no distinction between them.
(d) In any analysis conducted under subsection (c) of this
section, a court shall not consider factors intrinsic to the
character and operation of a limited liability company, whether
a single or multiple member limited liability company. Factors
intrinsic to the character and operation of a limited liability
company include but are not limited to:
(i) The ability to elect treatment as a disregarded
or pass-through entity for tax purposes;
(ii) Flexible operation or organization including the
failure to observe any particular formality relating to the
exercise of the company's powers or management of its
activities;
(iii) The exercise of ownership, influence and
governance by a member or manager;
(iv) The protection of members' and managers'
personal assets from the obligations and acts of the limited
liability company.