Complex Commercial Litigation
Entity and Structure Issues
Separateness requires distinct books and records, separate bank accounts, arm's length intercompany transactions, observed formalities, adequate capitalization, and distinct public presentation.
Erosion supports veil piercing and enterprise theories.
Alternative Names:
Corporate Formalities|Entity Separateness
Why it Matters?
Maintenance is substantially cheaper than defending a veil piercing claim, and the practices that matter are observable in discovery, including whether intercompany transfers were documented as loans with terms, whether boards met and recorded minutes, and whether the entities presented themselves distinctly to customers and vendors. Shared personnel is permitted where allocation is documented, which is a common practical accommodation.
Frequently Confused with
Related terms
Frequently asked questions
What practices matter most?
Is sharing personnel permitted?
