The Court of Appeals based this analysis on the Court of Appeals' case of Hildreth v. Because there was no disregard of the corporate entity, or alter ego issue, the Court felt that fraud was required. "In sum, Maryland is averse to disregarding the entity shield in a business situation in the absence of fraud." Serio at p.
#Pierce the veil concert maryland trial#
15. Because the trial court found no fraud, the Court of Special Appeals refused to enforce piercing of the corporate veil on the basis of a paramount equity. In Serio, the Court rationalized that "Maryland decisions that recognize alternate grounds for piercing the corporate veil have not done so absent a finding of fraud". App., Oct.28, 2011) quoting Bart Arconti & Sons, Inc. In Maryland, the standard for piercing the corporate veil set by the Court of Appeals is that “shareholders generally are not held individually liable for the debts or obligations of a corporation except where it is necessary to prevent fraud or enforce a paramount equity.
The Court reversed a trial court finding of liability against the managing member of a real estate development company, citing the lack of a finding of fraud. Baystate Properties LLC, the Maryland Court of Special Appeals, if not modifying Maryland law on piercing the corporate veil, re-enforced the disfavor upon which such actions are viewed by Maryland courts.
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