Limitation of liability for copyright claims: GmbH, LLC, Ltd

Limitation of liability for copyright claims

How can a limitation of liability protect against copyright claims? Copyright infringement can have serious consequences for limited liability companies such as a GmbH, LLC or Ltd. This article examines the extent to which limitation of liability offers protection in copyright infringement claims.

Limitation of liability in the event of a lawsuit

Basic principle of limited liability

• GmbH, LLC and Ltd offer shareholders protection from personal liability
• Company assets are liable for liabilities, not the private assets of the shareholders

Limits of the limitation of liability

1. Managing director liability: Personal liability threatens in the event of breaches of duty
2. Intentional actsIntentional copyright infringements can Limitation of liability break through
3. Undercapitalization: Extreme cases could lead to liability under the law

Does limited liability help with copyright claims?

Protective effect of the limitation of liability

• In principle, yes: shareholders are protected against personal financial losses
• Company bears court costs and any claims for damages

Restrictions on protection in copyright actions

1. Insolvency riskInsufficient capital can lead to company insolvency
2. Pass-through liabilityPossible in exceptional cases, e.g. abuse of rights
3. Reputational damageLoss of image despite financial protection

Consequences of insufficient capital

Undercapitalization may not allow the limitation of liability to unfold its true power.

Consequences for GmbH, LLC, Ltd

• Possible insolvency of the company or case closure
• Creditors may not be able to fully enforce claims

Legal risks for shareholders

1. Increased judicial scrutiny: Corporate structure under observation
2. Potential pass-through liability: Possible in case of extreme undercapitalization

Preventive measures against copyright claims

This makes the limitation of liability for copyright claims even more effective.

1. Ensure adequate capitalization of the GmbH, LLC or Ltd
2. Legal protection insurance for copyright cases can also be taken out as an option for high-risk sectors
3. Careful examination of copyrights before content use
4. Employee training in copyright issues