Summary
In James, the Court of Appeals held that the plaintiffs "did not meet this burden, inasmuch as they failed to produce evidence that the individual defendants took steps to render the corporate defendant insolvent in order to avoid to plaintiffs' claim for damages or otherwise defraud plaintiffs" (id. at 919).
Summary of this case from Coolbaugh v. Shulman Indus. Inc.Opinion
2012-11-29
Kayla JAMES, etc., et al., Appellants, v. Loran Realty V Corp., Defendant, Frank Palazzolo, et al., Respondents.
Sullivan Papain Block McGrath & Cannavo P.C., New York City (Brian J. Shoot of counsel), for appellants. Hass & Gottlieb, Scarsdale (Lawrence M. Gottlieb of counsel), for Frank Palazzolo, respondent.
Sullivan Papain Block McGrath & Cannavo P.C., New York City (Brian J. Shoot of counsel), for appellants. Hass & Gottlieb, Scarsdale (Lawrence M. Gottlieb of counsel), for Frank Palazzolo, respondent.
MEMORANDUM:
The order of the Appellate Division should be affirmed, with costs, and the certified question answered in the affirmative.
Plaintiffs, as the party seeking to pierce the corporate veil, had the burden to show that the individual defendants “abused the privilege of doing business in the corporate form to perpetrate a wrong or injustice against” them (Matter of Morris v. New York State Dept. of Taxation & Fin., 82 N.Y.2d 135, 141, 603 N.Y.S.2d 807, 623 N.E.2d 1157 [1993] ). Plaintiffs did not meet this burden, inasmuch as they failed to produce evidence that the individual defendants took steps to render the corporate*483defendant insolvent in order to avoid plaintiffs' claim for damages or otherwise defraud plaintiffs. Chief Judge LIPPMAN and Judges CIPARICK, GRAFFEO, READ, SMITH and PIGOTT concur.
On review of submissions pursuant to section 500.11 of the Rules of the Court of Appeals (22 NYCRR 500.11), order affirmed, with costs, and the certified question answered in the affirmative, in a memorandum.