Business & Insurance Litigation Newsletter for Indiana

Lost Profits of S-Corp May be Recoverable in Personal Injury Action

In Bovla v. Gary, 843 N.E.2d 952 (Ind. Ct. App. 2006), Bovla sued the defendant for personal injuries sustained in an automobile accident and claimed lost profits of the subchapter S-corporation which he owned and operated. Relying on traditional principles of corporate law, the defendant argued that Bovla was not entitled to recover lost profits of the corporation since he was pursuing a personal injury claim in his individual capacity. However, the Court held that when a corporation is essentially a sole proprietorship and the plaintiff is in essence the alter ego of the corporation, plaintiff may recover the corporate lost profits in a personal injury action.