CARTE BLANCHE (SINGAPORE) PTE., LTD., Plaintiff-Appellant, v. DINERS CLUB INTERNATIONAL, INC., also known as Citicorp/Diners Club, Inc., also known as The Diners Club, Inc., and CARTE BLANCHE INTERNATIONAL, LTD., Defendants-Appellees., 2 F.3d 24

Summary

Plaintiff franchisee brought an action to pierce the corporate veil and collect an arbitration award from defendant parent corporation which it had obtained against defendant subsidiary corporation. After a jury trial, the district court directed entry of judgment in favor of defendants. The court reversed and remanded, directing the district court to enter judgment in favor of plaintiff. Applying New York law, the court determined that the corporate veil was to be pierced only to prevent fraud or other wrong, or where a parent dominated and controlled a subsidiary. At the time of the breach, defendant subsidiary did not act as a separate corporation, as indicated, among other factors, by its failure to perform corporate formalities for at least two years and its lack of assets, corporate records, minutes, officers, directors, paid employees, or separate bank accounts. Defendant parent dominated and controlled every aspect of defendant subsidiary's operation. Therefore, New York law ...