Case Law
Curci Investments, LLC v. Baldwin, 14 Cal. App. 5th 214 (2017)
California’s charging order is exclusive as to the debtor’s transferable interest. Reverse veil piercing reaches the LLC’s assets instead.
Short answer: a California Court of Appeal held that outside reverse veil piercing is available against an LLC in California, and that the charging-order exclusivity provision does not bar it, because reverse piercing reaches the LLC’s assets, not the member’s transferable interest.
The citation
- Case: Curci Investments, LLC v. Baldwin
- Citation: 14 Cal. App. 5th 214, 221 Cal. Rptr. 3d 847 (Cal. Ct. App., 4th Dist., Div. 3, Aug. 10, 2017)
What the court held
Postal Instant Press, Inc. v. Kaswa Corp., 162 Cal. App. 4th 1510 (2008), which barred outside reverse veil piercing, was “expressly limited to corporations.” California Corporations Code § 17705.03(f) makes the charging order the exclusive remedy for reaching “the judgment debtor’s transferable interest”, and reverse veil piercing “is a means of reaching the LLC’s assets, not the debtor’s transferable interest in the LLC.” The RULLCA drafters’ comments confirm the charging provisions are “not intended to prevent a court from effecting a ‘reverse pierce’ where appropriate.”
The court reversed and remanded for a fact-driven determination, expressly declining to say whether the veil should actually be pierced.
The facts that drove it
Baldwin held 99% of a Delaware LLC formed to “hold and invest” his and his wife’s cash. He caused $178 million in distributions between 2006 and 2012, and then zero distributions after the October 2012 judgment. Curci collected nothing on its charging order.
How it is commonly miscited
As having “abolished charging-order protection in California.” It did not. It opened a narrow, fact-intensive equitable route and remanded without deciding it.
The planning lesson
This one is directly relevant to California clients. Charging-order exclusivity is not a force field: an entity used as the owner’s pocket, with distributions turned off the moment a judgment lands, invites an equitable remedy. Respect the entity, genuine business purpose, real separateness, consistent distribution practice, proper records, or the protection thins. Note also that single-member status makes reverse piercing easier, not harder.
Why this matters for your plan
Reading the cases is not an academic exercise. Every one of these decisions turned on something a planner controls: when the structure was created, how much control the settlor kept, whether the governing-law choice was backed by real contacts, and whether the client told the truth on the record. We build to the way these disputes are actually litigated, because Elizabeth litigates them. To discuss how your situation maps onto this body of law, call (858) 755-6672.
A necessary caveat
These summaries describe published decisions. They are informational only, are not legal advice, and do not predict any outcome. Case law changes, and the result in any dispute depends entirely on its own facts and procedural posture. Consult a qualified attorney about your circumstances.
Citation status
KeyCite as of August 8, 2026: Yellow. No direct history. Seven negative citing references; the most negative is Calsoft Labs, Inc. v. Panchumarthi (N.D. Cal. Jan. 31, 2020) (declined to follow).
Treatment signals change. Verify current status before relying on any decision.
Related resources
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Common questions
Frequently asked
Can a creditor reach LLC assets in California despite the charging order?
Potentially, through outside reverse veil piercing. In Curci Investments v. Baldwin the court held charging-order exclusivity under Corporations Code ยง 17705.03(f) covers the debtor's transferable interest, while reverse veil piercing reaches the LLC's assets, so the statute does not bar it. Whether to pierce is a fact-intensive question.
What conduct invites reverse veil piercing?
In Curci, the member held 99% of an LLC formed to hold his and his wife's cash, took $178 million in distributions over six years, and then stopped distributions entirely once a judgment was entered. Using an entity as a personal pocket and shutting off distributions when a creditor appears is the pattern courts respond to.
This website is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Every situation is different; please consult a qualified attorney about your specific circumstances.
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