Denver is notorious in other regards as well for STR and regulations in general.Converting the duplex to an SFR would have more cons than pros in general. and from zoning questions would be a tough thing to do.Definitely, a home with a mother-in-law suite or a separate living space is your best goal.

Most likely the state where the property is located is where lawsuits would be brought if they are something for personal injury like a trip and fall or something of that nature because the “cause of action” arose in that state.

My friend put his rental in a LLC and he states it will cover him if there is a lawsuit etc.  

Newb investors or overly greedy investors making horrible decisions resulting in lawsuits and continued black eyes in REI as well as more and more laws which goes hand in hand with the first one.

Property owners who refused to allow either the rental or point of sale inspection were subject to fines and possible criminal prosecution.The lawsuit, which was filed on behalf of several property owners by the 1851 Center for Constitutional Law, a non-profit entity, alleged that because the inspections were done under the threat of criminal prosecution, the ordinance violated the Fourth Amendment protection against unreasonable searches.

Or if a property manager sexually harasses a tenant, the lawsuit could be expensive.

Seriously, ask around Biggerpockets and try to find one investor that lost their personal property due to a lawsuit against their investment property.

Again there are a lot of moving parts, but only if the lawsuit goes against you or your WY LLC then goes backwards down the chain of ownership does it matter. 

However, it offers better anonymity than an LLC, and, when combined with an LLC as the Beneficiary, you will get the limited liability protection of the LLC (as the LLC owns the Land Trust) if the Land Trust were broken and dissolved during a lawsuit.

Water bills are outrageously high in Akron from ongoing lawsuits against the city, & they're just passing the cost onto the residents.