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

UPDATED: Aug 20, 2011

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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


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 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.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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