Scenario: An unincorporated business acts and operates independently of its parent company, which is a national corporation. This national corporation wholly owns the unincorporated entity. Lets say that the unincorporated company is sued by an individual that was involved in a car accident with one of their employees, who was an acting agent of the firm. In fact, the plaintiff (person suing) is at fault for the accident but plans to sue anyway.
Question: How is the liability for litigation distributed to the unincorporated company and the parent (incorporated) company? How can this risk of liability be mitigated through business reorganization?