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Org-Chart-1024x576In June, the Pennsylvania Supreme Court granted an appeal that could radically alter existing state law on corporate liability based on the veil-piercing theory. The case, arising from a dram shop tort action, is poised to test Pennsylvania law’s “strong presumption” against piercing the corporate veil.

In the November 5, 2020 edition of The Legal Intelligencer Edward T. Kang, managing member of KHF wrote “Pa. Supreme Court to Review Veil-Piercing Appeal Based on Enterprise Theory.

In June, the Pennsylvania Supreme Court granted an appeal that could radically alter existing state law on corporate liability based on the veil-piercing theory. The case, arising from a dram shop tort action, is poised to test Pennsylvania law’s “strong presumption” against piercing the corporate veil. Hoping to recover damages from an affiliated corporation that was not a defendant at trial, the plaintiff in Mortimer v. McCool, was granted an appeal on the basis of the so-called “single business enterprise” or “single entity” theory. See Mortimer v. McCool, Nos. 20 MAL 2020, (Pa. June 22, 2020). Not currently adopted in Pennsylvania, the theory may be applied to allow a plaintiff to reach the assets of one or more affiliated corporations of the debtor when those “corporations share common ownership and are, in reality, operating as a corporate combine.” See Miners v. Alpine Equipment, 722 A.2d 691,695 (Pa. Super. 1998). Courts discussing or adopting the enterprise theory have found its rightful target to be corporate entities that have integrated business ownership and assets to achieve a common business purpose. Thus, in an important sense, by operating what is essentially a “single business enterprise” split into multiple affiliated entities (often purely for the sake of avoiding liability), owners of such enterprises open the door for the courts to impose shared liability. In the past, I have written about veil-piercing in Pennsylvania generally, as well as in specific regard to LLCs and the “alter ego” theory. This column addresses the implications of the Mortimer appeal and the “enterprise” theory for Pennsylvania corporate liability law.

Kang Haggerty & Fetbroyt has received national recognition for its Construction Law practice in the U.S. News – Best Lawyers® “Best Law Firms” 2021. In addition, the firm was recognized in the Philadelphia Metropolitan listings for Commercial Litigation and Construction Law.

Firms included in the 2021 Edition of U.S. News – Best Lawyers “Best Law Firms” are recognized for professional excellence with consistently impressive ratings from clients and peers. To be eligible for a ranking, a firm must first have a lawyer recognized in The Best Lawyers in America©, which recognizes 5% of lawyers practicing in the United States. Achieving a tiered ranking signals a unique combination of quality law practice and breadth of legal expertise.

The 2021 rankings are based on the highest lawyer and firm participation on record, incorporating 8.3 million evaluations of more than 110,000 individual leading lawyers from more than 22,000 firms.

The courts have, in turn, opened their ears (and maybe their hearts, too) to the plight of American businesses that have suffered on a truly historic scale.

Drawing of business meeting, participants wearing masks
In the October 15, 2020 edition of The Legal Intelligencer Edward T. Kang, managing member of KHF wrote “Business-Interruption Claims in the COVID-19 Era: Litigators Find Hope.

While the coronavirus itself may be novel, business interruption insurance lawsuits are not. Accordingly, in the initial wave of lawsuits arising from the pandemic, both business owners and courts throughout the country seemed trapped in a fixed mindset about this new type of case. Reeling from loss and damage, business owners assumed that since their businesses had been interrupted by COVID-19, their claims had merit. Courts, meanwhile, reading insurance policies narrowly, dismissed claims related to the virus for lack of tangible alteration to business property. In recent months, however, litigators have embraced more creative arguments to persuade the courts to hear their cases. The courts have, in turn, opened their ears (and maybe their hearts, too) to the plight of American businesses that have suffered on a truly historic scale.

Philadelphia, PA (October 14, 2020):  Kang Haggerty & Fetbroyt LLC, a business litigation boutique with offices in Philadelphia, PA and Marlton, NJ is pleased to announce that Kyle Garabedian has joined the firm as an associate.

Headshot of Kyle Garabeidan

Kyle Garabedian

Kyle represents clients in a wide range of complex and general civil litigation, including contract claims, business torts, professional malpractice and other commercial disputes. His practice includes prosecuting and defending claims for clients both large and small. He joins the firm after five years of practice at Fellheimer & Eichen LLP.

Clipboard and Chart overlay on modern buildingPiercing the veil of limited liability companies (LLCs) allows a court to disregard the separate corporate personality of the company and its member(s) to reach the assets of the members and hold them liable for all or part of the LLC’s debts under Pennsylvania law.

In the September 3, 2020 edition of The Legal Intelligencer Edward T. Kang, managing member of KHF wrote “Piercing the Corporate Veil of LLCs Under Pennsylvania Law.

Piercing the veil of limited liability companies (LLCs) allows a court to disregard the separate corporate personality of the company and its member(s) to reach the assets of the members and hold them liable for all or part of the LLC’s debts under Pennsylvania law. Previously, I’ve written on the general substantive and procedural requirements of piercing the corporate veil of an entity and alter ego jurisdiction over corporate groups. This column addresses the Pennsylvania law on the doctrine of piercing the corporate veil as applied to LLCs.

Illustration of computer monitor with six people video chattingPlease join KHF Managing Member Edward T. Kang (panelist) and Member Kandis L. Kovalsky (moderator) for an upcoming CLE, Next-Level ADR — The Future is Now for Arbitration in Complex Cases, during the NAMWOLF Virtual Annual Meeting, on September 16, 2020 from 4:00-5:00 PM ET.

The notable reasons for taking the arbitration route as opposed to heading to the Courthouse have only been exacerbated in recent months. We’ve seen what technology can (and can’t) do, what happens when the courthouse calendar gets further backlogged, and resources are slim. Where is arbitration heading in the legal profession?

Edward and Kandis will be joined by fellow panelists Nelson C. Bellido, Managing Partner of ROIG Lawyers in Miami, Florida; Marcus Wester, Senior Litigation Counsel, Harley-Davidson Motor Company; and Ingeuneal C. Gray, VP, Commercial Division, American Arbitration Association.

Kang Haggerty & Fetbroyt LLC is pleased to announce that three of the firm’s attorneys have been selected for inclusion in The Best Lawyers in America© 2021. Congratulations to Henry J. Donner, Gregory H. Mathews and Kandis L. Kovalsky.

For Donner, Of Counsel, this is his 10th consecutive year on the Best Lawyers list. Mathews, also Of Counsel to the firm, is listed for the fourth year in a row. Kovalsky, one of KHF’s newest members, is included in the inaugural edition of the Best Lawyers: Ones to Watch for Commercial Litigation.

Attorneys were recognized in the following practice areas for Philadelphia, Pennsylvania:

On Monday, August 24th KHF Associate Tianna Kalogerakis joins Judge Ann M. Butchart, Anjelica Hendricks, Stephen Kulp and Jennifer Coatsworth to present a CLE on professional inclusion. The CLE, Professional Inclusion: Sexual Orientation, Gender Identity and Rule 8.4(G), Prohibiting Discrimination “In The Practice of Law,” will address the June 8, 2020 Pennsylvania Supreme Court ruling, diversity training on the same and a lawsuit recently filed to prevent its implementation.  The CLE is moderated by Amanda J. Dougherty and is co-hosted by the Philadelphia LGBTQ Bar Association and the Barristers Association of Philadelphia. 50% of the proceeds will be donated to the National Black Justice Coalition.

Diverse group of business people with arms foldedA recent decision out of the U.S. District Court for the Eastern District of Michigan underscored the RICO “proximate cause” inquiry highlighting yet another, often overlooked, complexity in litigating such cases.

In the July 23, 2020 edition of The Legal Intelligencer Edward T. Kang, managing member of KHF wrote “Civil RICO and Proximate Cause: A Tool for Defendants and Challenge for Plaintiffs.

In March 2018, I authored a column on civil RICO claims brought under 18 U.S.C. Section 1962(a) and (b). In that space, I explained the complexity of those sections within RICO cases. A recent decision out of the U.S. District Court for the Eastern District of Michigan underscored the RICO “proximate cause” inquiry highlighting yet another, often overlooked, complexity in litigating such cases.

In the July 23, 2020 edition of The Washington Post, national sports reporter Adam Kilgore gets Edward Kang’s take on how can the Washington NFL team’s internal review be independent? Legal experts weigh in..

An inherent question looms over the Washington NFL team’s investigation of its workplace culture: If owner Daniel Snyder is paying the law firm tasked with inspecting his franchise, how can the ensuing report be considered independent, as Snyder insists it will be?

The article centers on Snyder’s hiring of D.C. attorney Beth Wilkinson to conduct an internal review of the team’s culture, in the aftermath of a Post report about 15 women who alleged sexual harassment while working for the franchise.

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