Pennsylvania Jury Instruction - 1.9.5.2 Subsidiary As Alter Ego Of Parent Corporation

• Category: Federal - Jury Instructions
• State: Multi-State
• Control #: US-11CF-1-9-5-2
• Format: Word; Rich Text

Description

This form contains sample jury instructions, to be used across the United States. These questions are to be used only as a model, and should be altered to more perfectly fit your own cause of action needs.

Pennsylvania Jury Instruction — 1.9.5.2 Subsidiary As Alter Ego Of Parent Corporation In Pennsylvania, when a subsidiary corporation acts as the alter ego of its parent corporation, it can be held liable for the parent's actions. This legal principle is essential in situations where a subsidiary is created and operated primarily for the benefit of its parent, without maintaining separate identities. The jury instruction — 1.9.5.2 Subsidiary As Alter Ego Of Parent Corporation, serves as guidance for the jury in understanding when a subsidiary corporation can be seen as the alter ego of its parent corporation. The instruction aims to ensure that the jury understands the legal criteria that can establish such a relationship. Typically, the instruction is divided into different types based on specific circumstances or criteria that need to be met. These various types may include: 1. Control by the Parent: In this type of instruction, the jury is guided to consider whether the parent corporation exercises substantial control over the subsidiary, both in terms of day-to-day operations and decision-making. Factors such as the parent's ownership of voting stock, control over the subsidiary's management, and domination in business activities come into play. 2. Common Officers and Directors: This instruction focuses on the presence of common officers and directors between the parent and subsidiary corporations. If there is a significant overlap in the personnel holding executive positions, it suggests that the subsidiary is operating as an alter ego of the parent. 3. Financial Dependency: Here, the jury is directed to examine the financial relationship between the parent and subsidiary. Factors such as the subsidiary's dependence on the parent's financial assistance, intermingling of funds, or inadequate capitalization can support a finding of alter ego status. 4. Identical Business Interests: This type of instruction emphasizes the shared business interests between the parent and subsidiary corporations. If there is a substantial overlap in operations, assets, customers, or branding, it suggests that the subsidiary is merely an extension of the parent's business. 5. Fraudulent Intent: If there is evidence of fraudulent intent or an intention to evade legal obligations through the use of a subsidiary corporation, the jury is instructed to consider this aspect. Fraudulent conduct, such as disregarding corporate formalities or manipulating the subsidiary's affairs to shield the parent from liability, can establish alter ego status. It is important to note that the jury instruction — 1.9.5.2 Subsidiary As Alter Ego Of Parent Corporation provides a framework for the jury to consider these types and determine whether a subsidiary should be treated as the alter ego of its parent corporation. The jury must carefully review the evidence presented during the trial, align it with the criteria outlined in the instruction, and reach a conclusion that fairly reflects the relationship between the corporations involved. The application of this jury instruction is critical in cases where plaintiffs seek to hold the subsidiary responsible for the parent's conduct, allowing for a comprehensive examination of the corporate structure and ensuring justice in legal proceedings.