Mississippi Jury Instruction - 1.9.5.2 Subsidiary As Alter Ego Of Parent Corporation
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Courts might pierce the corporate veil and impose personal liability on officers, directors, shareholders, or members when all of the following are true. There is no real separation between the company and its owners. ... The company's actions were wrongful or fraudulent. ... The company's creditors suffered an unjust cost.
Courts will disregard the corporate entity, allowing for individual shareholders, directors or officers (i.e. the ?alter-egos?) to be held liable in certain circumstances. This is also known as ?piercing the corporate veil.?
Alter ego is a legal doctrine whereby the court finds that a corporation lacks a separate identity from an individual or corporate shareholder. The court applies this rule to ignore the corporate status of a group of stockholders, officers, and directors of a corporation with respect to their limited liability.
A U.S. corporation was held liable under the alter ego doctrine for the debts of two foreign corporations where: (1) all three corporations were wholly owned by a single individual; (2) the work of all three corporations was performed by the same employees; (3) the three companies were operated in such a way that no ...
Alter ego generally requires proof of: (1) a unity of interest and ownership such that the separate personalities of the entity and individual do not exist, and (2) an unjust or inequitable result if the corporate entity is not disregarded.
Piercing the Corporate Veil/Alter Ego. There are some circumstances under which the corporate form will be disregarded and the corporate veil will be pierced to hold individual officers or shareholders personally liable for the conduct or debts of the entity.