Minnesota Lawyer
Where a corporation with three shareholders owns commercial buildings; one of the shareholders, who was also the sole shareholder of a corporation that provided the buildings’ property-management services, proposed a new technology plan for the buildings with services to be provided by a separate technology corporation which the shareholder also formed; the shareholder siphoned money to himself through additional technology-related fees; the fact that the sole shareholder was siphoning the money was not obvious; and the other two shareholders testified that they made inquiries regarding financial matters relating to the technology and received repeated reassurances from the sole shareholder; we conclude that the District Court, as fact-finder, did not err in determining that the two shareholders reasonably relied on the sole shareholder’s misrepresentations.
We also conclude that piercing of the corporate veil was appropriate.
Affirmed.
A09-2107 Cirrus, Inc. v. Whitney (Hennepin County)
