Also known as:voies directes · direct action · direct recourse
Written by attorneys · grounded in primary & secondary sources — see below
A lawsuit brought directly by a claimant against a third party such as an insurer or company manager to enforce the claimant's personal rights without first proceeding against an intermediary entity.
Sources & Authorities
How it applies
Common Examples
6
Direct Action Against Insurer
Valerie Viera, a Florida citizen, sues the liability insurer of Velocity Logistics in federal court under a Georgia direct-action statute after a trucking accident. Velocity Logistics is incorporated in New York and Illinois with its principal place of business in Illinois. The insurer is incorporated in New York with its principal place of business in Illinois. The court treats the insurer as a citizen of New York and Illinois plus every state of which the insured is a citizen.
LLC Member Direct Claim
Vincente Vukovic, a member of Valor Capital LLC, sues the managing member for diverting company funds into a personal side business. The operating agreement gave Vincente specific distribution rights that the manager violated. Vincente pleads an injury to his own interests separate from any loss to the LLC itself.
Select any source to read its text and confirm it supports the definition.
Statutes
Uniform Acts
Restatements
Hornbooks
Limited Partnership Direct Suit
Victoria Vernon, a limited partner in Volta Electric LP, sues the general partner for breaching a side agreement that promised her personal access to proprietary technology. The agreement created rights independent of her partnership interest. She seeks enforcement without first pursuing an accounting of the partnership.
Pleading Injury in LLC Action
Vanessa Vega, a member of Valdez Steel LLC, files a direct action alleging the manager awarded herself excessive bonuses. Vanessa pleads that the bonuses reduced her personal distributions under the operating agreement and was not merely a general injury to the company. The complaint includes facts showing the harm is particular to her membership interest.
Direct Claim for Sanctionable Conduct
Violet Vang sues her former business partner after he destroys documents central to their joint venture dispute. The partner had already been warned by the court about discovery abuse. Violet seeks sanctions directly against the partner for the bad-faith destruction rather than pursuing relief only through the entity.
Chambers v. NASCO, Inc.501 U.S. 32 (1991)
Direct Action Jurisdiction Limits
Veronica Villanueva, injured in an accident, sues the liability insurer of the at-fault driver in the state where the policy was issued. The insured driver has no contacts with that state. The court refuses to base jurisdiction solely on the insurer's policy obligation and requires independent contacts with the forum.
Rush v. Savchuk444 U.S. 320, 332 (1980)
Common questions
Frequently Asked
4
When does a direct action against a liability insurer expand the insurer's citizenship for diversity purposes?+
In a direct action against the insurer of a liability policy where the insured is not joined as a defendant, the insurer is deemed a citizen of every state of which the insured is a citizen in addition to its own states of incorporation and principal place of business.
What must a member plead to maintain a direct action in an LLC?+
The member must plead and prove an actual or threatened injury that is not solely the result of an injury to the limited liability company itself.
How does the direct-action rule differ from a derivative action in an LLC?+
A direct action enforces the member's personal rights and interests, while a derivative action enforces a right belonging to the LLC after demand or a showing of futility.
Does a partner need an accounting before bringing a direct action in a limited partnership?+
No. A partner may maintain a direct action with or without an accounting as to the partnership's activities and affairs.
444 U.S. 286 (1980)Civil Procedure
…beyond what he would face if the suit were in his home State. The real impact on the named defendant is the same as it is in a direct action against the insurer, which would be constitutionally permissible. Watson v. Employers Liability Assurance Corp. , 348 U. S. 66 (1954); Minichiello v. Rosenberg , 410 F. 2d 106, 109-110…