What duties do officers and directors of a closely held business owe the company’s creditors when the company is failing?  Unfortunately, this has become a common question during these troubling economic times.  The answer in Wisconsin appears to be bit different than other states at this point if the failing business is still a “going concern.” In Polsky v. Virnich, thecourt held that officers and directors do not owe a fiduciary duty to creditors unless the company is BOTH: (a) insolvent; and (b) not a “going concern.” The court is quite critical of the “going concern” element reasoning that officers and directors in a closely held business can easily keep a failing business “going” and then drain the insolvent company of all cash via bonues, etc… while the company is insolvent thereby enriching themselves who also happen to be the owners. This appears to be at odds with many other jurisdictions where the rule is that a duty is owed creditors when the company is merely insolvent.