Kinney Shoe Corp v. Polan
Kinney Shoe Corp v. Polan, 939 F.2d 209, is a US corporate law case, concerning piercing the corporate veil.
Facts
Kinney Shoe Corp sued Mr Lincoln M Polan to pay money outstanding on a sub-lease by the "Industrial Realty Company". Polan wholly owned "Industrial", but had never held any corporate meetings or elected officers.The question is whether Kinney could pursue Mr Polan for the debt.
Judgment
Chapman J quoted from Sanders v Roselawn Memorial Gardens, Inc. that the "fiction" of separate legal personality,It emphasized that each case should be decided on its facts, and pointed to a number of relevant factors.
- that Industrial was not adequately capitalized
- no corporate formalities, such as taking minutes or electing officers, had been observed
- it appeared that the company was deliberately used to carry out transactions to benefit another of Mr Polan's companies, which had assets but would be shielded from liability