Background
Michael P. Link was a 50% shareholder and director of Total Imaging Concepts, Inc. (“TIC”), a Louisiana corporation, until his death on August 31, 2024. TIC alleged that in January 2021, Mike Link breached his fiduciary duties by facilitating the removal of TIC’s medical imaging equipment from a Florida state prison and allowing rental payments of approximately $160,000 to be diverted to his brother’s company, Imaging Support Services, Inc. (“ISS”), rather than to TIC. TIC first sued Mike Link and related parties in Caddo Parish district court in October 2022, but that action was removed to federal court at Mike Link’s request and ultimately dismissed without prejudice in July 2024 for lack of personal jurisdiction over Mike Link.
After Mike Link’s death, his surviving spouse Gail Link was appointed administrator of his estate by an Ohio probate court and subsequently by a Louisiana ancillary proceeding. She filed suit in Caddo Parish in February 2025 seeking corporate records and a shareholder meeting. TIC responded in March 2025 by filing a reconventional demand against the Estate asserting the same breach-of-fiduciary-duty claims from January 2021. The Estate raised exceptions of peremption and prescription, arguing that Louisiana’s three-year outer limit under La. R.S. 12:1502 had run by January 2024 and extinguished TIC’s claims. The trial court overruled the exceptions, reasoning that La. R.S. 12:1502(E) rendered all time limits in the statute interruptible by the timely filing of a lawsuit in a court of competent jurisdiction. The Estate sought supervisory review.
The Court’s Holding
The Second Circuit reversed the trial court and sustained the Estate’s peremptory exception of peremption, dismissing TIC’s reconventional demand with prejudice. Applying de novo review to the purely legal question of statutory interpretation, the court held that the three-year outer limit in La. R.S. 12:1502(C) and (D) is peremptive, not merely prescriptive. Relying on its own recent decision in Succession of Tripp, 55,496 (La. App. 2 Cir. 5/29/24), 387 So. 3d 939, the court reaffirmed that the “in no event” language fixing the three-year ceiling reflects a legislative choice to extinguish the underlying right itself upon expiration — not merely to bar the remedy.
The court further held that La. R.S. 12:1502(E), which states that the time limitations “shall not be subject to suspension on any grounds or interruption except by timely suit filed in a court of competent jurisdiction and proper venue,” applies only to the one- and two-year prescriptive periods in subsections (C) and (D). The court observed that the qualifying phrase “filed in a court of competent jurisdiction and proper venue” tracks the language of the one- and two-year periods but is conspicuously absent from the three-year provisions, indicating legislative intent to confine subsection (E)’s interruption mechanism to the shorter prescriptive periods while leaving the three-year ceiling as an absolute peremptive bar. Because TIC’s reconventional demand was filed more than three years after the alleged acts in January 2021, the right was extinguished and could not be revived. The court declined to reach the Estate’s alternative arguments regarding personal jurisdiction and Richard Lee’s authority to file the 2022 suit.
Key Takeaways
- The three-year outer limitation period in La. R.S. 12:1502(C) and (D) for claims against corporate officers and directors is peremptive — it extinguishes the underlying right entirely and cannot be interrupted or suspended by any means, including the filing of a prior lawsuit.
- La. R.S. 12:1502(E)’s exception permitting interruption “by timely suit filed in a court of competent jurisdiction and proper venue” applies only to the one- and two-year prescriptive periods; it does not save claims filed outside the three-year peremptive window.
- A prior lawsuit that was dismissed for lack of personal jurisdiction cannot interrupt even a prescriptive period, but the court found it unnecessary to decide that question once it determined the three-year period is peremptive and absolutely bars revival of the claim.
- Corporations and their counsel must assert director/officer breach-of-fiduciary-duty claims within three years of the alleged wrongful act, regardless of discovery, or the claims are permanently extinguished under Louisiana law.
Why It Matters
This decision reinforces a strict bright-line rule for Louisiana corporate litigation: claims against officers and directors under La. R.S. 12:1502 face a hard three-year deadline that no procedural maneuver — including a prior timely-filed but jurisdictionally defective lawsuit — can extend. The ruling resolves an ambiguity left open in Tripp by confirming that subsection (E)’s interruption mechanism does not reach the three-year peremptive ceiling, and it squarely rejects the trial court’s view that the statute collapses the prescription/peremption distinction into a single interruptible time limit.
For practitioners, the decision underscores the importance of filing breach-of-fiduciary-duty claims against corporate insiders in a court with proper jurisdiction and venue within three years of the alleged act — and not relying on a defective earlier filing to preserve the claim. Corporations that believe a director or officer has breached duties should move quickly to identify the proper forum and file suit, because once the three-year period expires, the cause of action is destroyed, not merely delayed.