Piercing the corporate veil.

Practice point: In order to state a viable claim against a shareholder, in an individual capacity, for actions purportedly taken on behalf of the corporation, a plaintiff must allege facts that, if proved, indicate that the shareholder exercised complete domination and control over the corporation and abused the privilege of doing business in the corporate form to perpetrate a wrong or injustice.

Student note: Factors to be considered in determining whether an individual has abused the privilege of doing business in the corporate form include the failure to adhere to corporate formalities, inadequate capitalization, commingling of assets, and the personal use of corporate funds.

Case:  Allstate ATM Corp. v. E.S.A. Holding Corp., NY Slip Op 05898 (2d Dept. 2012).

Here is the decision. 

Tomorrow’s issue: Duty to provide a safe workplace.