Piercing the corporate veil would seem to be an appropriate course of action in court when there is serious misconduct within the operations of the company. Most of the time, judges attempt to avoid piercing the corporate veil, as it stunts development within public markets and causes individuals to mistrust LLC’s. There is no set reason why a judge would pierce the corporate veil, and it varies even more state-to-state. Reasons could vary from under-capitalization to failing to keep minutes or other corporate formalities. When the veil is pierced, all shareholders and owners of the company, acquire the company’s debt and they are all required to use personal income and or assets to pay it off. This is very common with corporations with very few shareholders as there is no general board of general directors or formal meetings to ensure proper conduct of the company.