Bischofshausen, Vasbinder, and Luckie v. D.W. Jaquays Mining and Equip. Contractors Co., 145 Ariz. 204, 210-11, 700 P.2d 902, 908-09 (App. 1985) (corporate directors can be personally liable for torts committed by a corporation or an officer by virtue of their office if they "have knowledge amounting to acquiescence. . . . "). The problem here, however, is there is no evidence appellants were aware of the misrepresentation concerning loan priorities and certainly nothing that would indicate the misrepresentations were being authorized or acquiesced in.

Bischofshausen, Vasbinder, and Luckie v. D.W. Jaquays Mining and Equip. Contractors Co., 145 Ariz. 204, 210-11, 700 P.2d 902, 908-09 (App. 1985) (corporate directors can be personally liable for torts committed by a corporation or an officer by virtue of their office if they "have knowledge amounting to acquiescence. . . .").

The rule in Arizona, where Transnation is incorporated, is that corporations are legally separate entities whose acts are not imputed to their officers, shareholders, or affiliates. In rare cases Arizona courts will pierce the corporate veil and declare a corporation the alter ego of another entity, see Gatecliff v. Great Republic Life Ins. Co., 170 Ariz. 34, 821 P.2d 725, 729 (1991) (in banc), but mere common ownership is insufficient for piercing, see, e.g., Bischofshausen, Vasbinder, Luckie v. D.W. Jaquays Mining Equip. Contractors Co., 145 Ariz. 204, 700 P.2d 902, 907 (Ct.App. 1985). Instead, Arizona courts require a showing that the corporations share a "unity of control" and that observance of the corporate form would sanction a fraud or promote injustice.

"[C]orporate directors are not personally liable for torts committed by the corporation or by one of its officers merely by virtue of the office they hold." Bischofshausen, Vasbinder, and Luckie v. D.W. Jaquays Min. and Equipment Contractors Co., 145 Ariz. 204, 211 (App. 1985). "[T]heir status," however, "does not shield them from personal liability."

It is an established principle of corporations law that corporate directors are not liable merely by virtue of their office for fraud or other tortious wrongdoing committed by the corporation or its officers. See, e.g., Bischofshausen, Vasbinder Luckie v. D.W. Jaquays Mining and Equipment Contractors Co., 145 Ariz. 204, 700 P.2d 902, 908-09 (Ariz. App. 1985); Speer v. Dighton Grain, Inc., 229 Kansas 272, 624 P.2d 952, 958-59 (1981); Klockner v. Keser, 29 Colo. App. 476, 488 P.2d 1135, 1137 (1971); Taylor v. Alston, 79 N.M. 643, 447 P.2d 523, 524 (1968); see also Lobato v. Pay Less Drugs, Inc., 261 F.2d 406, 409 (10th Cir. 1958). See generally 3A W. Fletcher, Cyclopedia of the Law of Private Corporations § 1137.

Impact asserts that even if it has or had an ownership interest in JFI, Impact and JFI are two separate entities. Furthermore, under Bischofshanusen, Vasbinder, & Luckie v. D.W. Jaquays Min. & Equip. Contractors Co., Impact is not liable for the acts of JFI, LLC even if Impact wholly owned JFI as a subsidiary, or financed it, or they were in the same building, shared the same telephone number and same bookkeeper. 145 Ariz. 204, 209, 700 P.2d 902, 907 (App. 1985). To state a claim against Impact for misappropriation of trade secrets, Plaintiffs need not allege that Impact itself stole the trade secrets; it is sufficient to allege that Impact is using JDM's trade secrets that it knows or has reason to know were acquired through improper means. Under A.R.S. § 44-401(2)(b) misappropriation includes "[d]isclosure or use of a trade secret of another without express or implied consent[.

Unity of control means there "is such a unity of interest and ownership that the personalities of the corporation and the owners cease to exist." Bischofshausen, Vasbinder, & Luckie v. D.W. Jaquays Min. & Equip. Contractors Co., 145 Ariz. 204, 208-09, 700 P.2d 902, 906-07 (App. 1985) (quoting Ize Nantan Bagowa, Ltd. v. Scalia, 118 Ariz. 439, 442, 577 P.2d 725, 728 (App. 1978)). Unity of control is shown where the parent corporation exercised "substantially total control over the management and activities of" the subsidiary.

Arizona law is well settled that courts will not disregard the corporate fiction and impose liability on the corporation's officers, directors, and shareholders unless the corporation is simply the alter ego of such officer, director, or shareholder. Bischofshausen, Vasbinder, and Luckie v. D.W. Jaquays Mining and Equipment Contractors Co., 145 Ariz. 204, 208, 700 P.2d 902, 906 (App. 1985). To prove that Madison Granite is simply the alter ego of Stan Novak, or to pierce the corporate veil, Trustee must establish that there is such a unity of interest and ownership between Stan Novak and Madison Granite that the separate personalities of him and the corporation cease to exist.

See id. Instead, "[t]he facts show no more than that the corporations were run in the same informal manner as is usually seen in closely held corporations." See Bischofshausen, Vasbinder, & Luckie v. D.W. Jaquays Mining & Equip. Contractors Co., 145 Ariz. 204, 209 (App. 1985). ¶23 Ashford also argues Gunwright's failure to keep liability insurance is particularly problematic when engaged in an "inherently dangerous" business.

These two propositions are so elementary that we think it a waste of space to cite authorities to support them.Fagerberg, 71 P.2d at 1024-25; see also Atkinson v. Marquart, 112 Ariz. 304, 541 P.2d 556, 557 (1975); Tovrea, 412 P.2d at 56-57; Bischofshausen, Vasbinder Luckie v. D.W. Jaquays Mining Equip. Contractors Corp., 145 Ariz. 204, 700 P.2d 902, 908-09 (1985); Jabczenski v. Southern Pac. Mem. Hosps., Inc., 119 Ariz. 15, 579 P.2d 53, 58 (1978); Kadish v. Phx.-Scotts. Sports Co., 11 Ariz. App. 575, 466 P.2d 794, 797 (1970). Similarly, the district court below relied on only those portions of the Dean decision with which it apparently agreed, and ignored the rulings with which it differed.