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the client of the LLC who has been severed the assignment order
even though the LLC has sent in a letter explaining it the client would like a letter from legal representation to explain it.
Steve,In that situation you have little options available to you. As you are likely aware, an LLC cannot be represented by anyone but an attorney. Unless one of your 6 partners is an attorney, if the LLC is requesting formal legal correspondence, you would need to retain counsel to do so. The assignment order, although against you as an individual, was still served onto the LLC, which, due to the fact it is an artificial entity, requires counsel to respond and contest their assignment. I do happen to agree with you that if the LLC can prove that it is a separate entity and that there is no 'alter ego' argument (that you, the former company, and the new company are really one entity) due to ownership dilution they really cannot demand an assignment order, but other than with counsel I do not see how you would be able to contest it, or communicate about it with your client. Hope that helps.
You may not understand the question the LLC is not requesting legal consul. the LLC has not been severed the assignment order. The assignment order has been served to some one that the LLC provides billable services to. The severed company used to pay my DBA which ended over 1 1/2 years ago. The LLC is not being asked to turn over any revenue on behave of wages or K-1 earning due XXXXX XXXXX...The other company a client of the LLC is being asked to turn over revenue due the LLC...with out any proof that the any of that money is due the debtor XXXXX XXXXX. Due to the Similar names the collector is simply using the LLC name as an identifier for the debtor. would the collect not have to sever the LLC first before having the ability to go after clients of the LLC. I feel the collector is trying to coheres the client into believing they are one in the same with out proof or proper legal process. the LLC has been severed not papers what so ever
StevemYou are correct, I did not understand, my apologies. Please allow me to re-answer.The other company has the right to demand both proof of judgment and validity of claim. They do not have to provide anything to the creditor simply on their say-so, especially as the letter to the other company appears to be more or less a fishing expedition rather than a legitimate demand. The collector not have to pursue the LLC first, and the creditor and holder of the judgment can seek to 'intercept' payments (which is what he attempting to do here), by assigning payments over to himself that are due to the individual that is signed under judgments. The LLC, in this case, has no duty to do anything but wait until there is substantial proof and evidence that the judgment is valid AND that the funds are being sent to the individual rather than the LLC which is not under judgment.Good luck.
last question I am sorry...so how do I explain that to the cleint being asked to send in funds due the LLC by telling them to asked for validity of debt owed by the LLC?
Steve,That is exactly how you explain it, point out to the LLC that you and the other entity are separate legal entities, there is no judgment against that entity, and unless they are sending funds directly to you which they would then have to forward to the initial party, they do not have to hold as the legal identities are different. It would still be up to the creditor to file suit against you against and prove 'alter ego' on all the different legal entities that you have currently set up.Good luck.
Thank you that is what I thought...
Steve,Glad to help and you are most welcome! If you found my information to be useful, please do not forget to positively rate my answers as otherwise I do not get paid for assisting you with your concerns. Thank you!
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