Paul H. Fitzgerald, Appellant, v. Fahnestock & Co., Inc., Respondent., 286 A.D.2d 573

Summary

The employee obtained an arbitration award and judgment for severance pay against his former employer. The employee was initially unable to enforce the judgment as the employe had sold all its assets to another corporation. By the time the employee had set aside that transfer as fraudulent, served a garnishment, and obtained a further judgment, he discovered that all of the assets had been transferred to the defendant company, rendering the other company unable to satisfy his judgment. The appellate court held the trial court erred in holding that there could be no de facto merger where the subsidiary was not legally dissolved. So long as the acquired corporation was shorn of its assets and had become a shell, legal dissolution was not necessary before a finding of a de facto merger could be made. The appellate court held the trial court further erred in limited the de facto merger doctrine to tort actions, since the doctrine had been held applicable in breach of contract actions. The ...