Commissioner of Environmental Protection et al. v. State Five Industrial Park, Inc., et al.

Summary

The Supreme Court of Connecticut considered whether reverse piercing of the corporate veil could be used to hold State Five Industrial Park, Inc. liable for an environmental judgment against Joseph J. Farricielli and related corporations. The court held that the trial court improperly applied reverse veil piercing because the evidence did not adequately address the interests of innocent shareholders and corporate creditors, and did not establish the required connection between Joseph's conduct and the plaintiffs' inability to collect the judgment. The court reversed the judgment without deciding whether reverse veil piercing is categorically available in Connecticut.

Holdings

1. The facts proven do not warrant reverse piercing of State Five's corporate veil because plaintiffs failed to demonstrate that innocent shareholders (Joseph and Jean's sons) would not be prejudiced, that corporate creditors would not be harmed, and that Joseph's control of State Five proximately caused plaintiffs' inability to collect the judgment.
2. The trial court's findings that the sons were not innocent shareholders and that no corporate creditors would be harmed were clearly erroneous.

Questions Presented

1. Whether the equitable doctrine of reverse piercing of the corporate veil is a viable remedy in Connecticut.
2. Whether the facts of this case warranted application of reverse veil piercing.

Disposition

reversed_and_remanded