piercing the corporate veil

Abortion Clinics: Shareholder Liability

It is settled law that corporate officers can be held responsible for damage they cause, even if the corporation itself is also found responsible. But what about shareholders of a corporation? Courts with equity powers (such as the DC courts) will deprive shareholders of the privilege of operating as a corporation and assign individual liability if the evidence shows misuse of the corporate form to perpetrate fraud or wrong. An egregious local example of shareholder liability for misuse of the corporate form is that of Mrs. Vuitch, ex-wife of abortion-purveyor Dr. Vuitch. His “clinic annex” was housed at their residence. Although Mrs. Vuitch moved out after their divorce, she remained as a shareholder in their business and as CFO. Educated in business and finance, she paid the bills for the vast clinic, and was aware of a brazenly illegal clinic policy that led to a gruesome injury and a jury finding of her personal liability, although she did not directly participate in the misconduct. The case was Vuitch v. Furr, 482 A.2d 811 (D.C. 1984).

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