The point of having a legal business entity is that now the business is responsible for any legal claims and debts that the business incurs and not the owner.
If COOL BOOK CORP happens to commit a bunch of copyright violations and Disney comes knocking for 10 million dollars, you'd rather it was COOL BOOK CORP that was on the hook than yourself.
Likewise, if the company falls 10 million dollars into debt, its the companys assets that are liquidated to pay debtors, not the owners.
Im not sure about the case you mention, so no comments there, just noting what the purpose is under US law. (also companies of course do all kinds of shenanigans that are not legal

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