Wednesday, July 04, 2007, 7:38 AM

LLC Member Not Liable For LLC Employee Injury

In Spaulding v. Honeywell International, Inc., the COA held that an LLC member could not be held liable based on its member status or for acts undertaken as a member.

Honeywell was a member of an LLC that was also plaintiff's employer. Plaintiff sued Honeywell and others, alleging exposure to hazardous chemicals in the workplace. The trial court granted summary judgment for Honeywell, and the COA affirmed.

The COA held that mere participation in the business affairs of a limited liability company by a member is insufficient, standing alone and without a showing of some affirmative independent conduct, to hold the member liable for harm caused by the LLC. This holding seems in tension with Hamby v. Profile Products, in which a divided COA panel indicated that tort liability is categorically excluded from a member-manager's participation in an LLC's ("regular") business but rather constitutes independent conduct. Judge Tyson, Spaulding's authoring judge, dissented in Hamby, which is currently pending before the Supreme Court. (And in the interest of full disclosure, WCSR represents Profile.)

Further, the COA held that because plaintiff had dismissed his claims against the employer LLC, derivative liability could not be pinned on Honeywell.

The COA also held that an affirmative undertaking would be required to hold an LLC member liable for an LLC employer's duty to ensure safety. Here, the COA held, there was no such affirmative undertaking.


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