Blue Whale Scores Corporate Veil Piercing Legal Victory in New York
A recent ruling by the Second Circuit Court of Appeals in New York will help preserve creditors' rights to seize assets in shipping disputes. The court overturned a ruling that protected the assets of HNA Group in a dispute between its subsidiary, Grand China Shipping Development and Blue Whale Corp.
This ruling upholds the broad reach of U.S. courts in "piercing the corporate veil" by allowing plaintiffs to seize assets held by different corporate entities deemed said to be alter egos of a wider corporate group. U.S. lawyers say there are numerous pending cases in federal courts that are pursuing similar alter ego claims that might have been affected if the original ruling was upheld.
"We believe that this decision has preserved our clients' rights in those cases," said Maritime Partner Michael Frevola, who submitted a friend-of-court brief in the appeals case for one of those clients.
READ: Blue Whale Scores Corporate Veil Piercing Legal Victory in New York (subscription may be required)