OOO "GARANT-S" v. Empire United Lines Co., Inc. et al
MEMORANDUM and ORDER: Defendants motion 31 for partial summary judgment limiting Empires liability is granted. Defendants motion for summary judgment on the claims alleged against Hitrinov is also granted. This case will be dismissed upon defendants notifying the Court that they have tendered $1000 to plaintiff. Ordered by Judge Frederic Block on 3/29/2013. (Innelli, Michael)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
-------------------------------------------------------------x MEMORANDUM AND ORDER
Case No. 11-CV-1324 (FB)
-againstEMPIRE UNITED LINES CO., INC. and
For the Plaintiff:
JON WERNER, ESQ.
Lyons & Flood LLP
65 West 36th Street, 7th Floor
New York, NY 10018
For the Defendants:
DMITRY A. CHERNOV
11821 Parklawn Drive, Suite 206
Rockville, MD 20852
BLOCK, Senior District Judge:
Plaintiff OOO “Garant-S” has filed suit against defendants Empire United Lines
Co., Inc. (“Empire”) and Michael Hitrinov (“Hitrinov”) (collectively “defendants”) for losses
arising from a third party’s theft of plaintiff’s automobiles. Defendants move for partial
summary judgment limiting Empire’s liability, and summary judgment on all claims alleged
against Hitrinov. The parties appeared for oral argument on March 22, 2013. For the below
reasons, defendants’ motion is granted in full.
The following facts, taken from the parties’ Rule 56.1 statements, are undisputed
unless otherwise noted. Where disputed, they are presented in the light most favorable to the
plaintiff. See Fed. Ins. Co. v. Am. Home Assurance Co., 639 F.3d 557, 566 (2d Cir. 2011).
Plaintiff operates a business whereby it purchases used automobiles at auctions
held in the United States and exports them to Kotka, Finland for sale. Since 2008, plaintiff has
engaged Empire to transport hundreds of vehicles per year to Finland. Empire is a common
carrier regulated by the Federal Maritime Commission, and coordinates the transportation of
its clients’ cargo from the United States to foreign countries by water. As a licensed Ocean
Transportation Intermediary and Non-Vessel Operating Common Carrier, Empire arranges
for cargo to be delivered to one of its United States storage facilities, then retains ocean
carriers to perform the actual overseas carriage.
Hitrinov is the President and sole
shareholder of Empire.
On November 4, 2010, two of plaintiff’s BMW vehicles (“vehicles”) were
delivered to Empire’s storage facility in Elizabeth, New Jersey. Four days later, thieves broke
into the facility and stole four automobiles—including both of plaintiff’s vehicles. The next
morning a security guard reported the thefts to the police, and Hitrinov thereafter filed police
reports for each stolen vehicle. Neither of plaintiff’s vehicles has since been recovered.
Plaintiff then filed suit against Empire and Hitrinov for its related losses, alleging
breach of contract, wrongful taking and conversion, fraud, negligence, gross negligence,
promissory estoppel, negligent misrepresentation, and unjust enrichment.1 Defendants now
move for partial summary judgment limiting Empire’s liability to $1000 pursuant to the
Carriage of Goods Sea Act, and summary judgment on all claims alleged against Hitrinov on
Plaintiff also alleges a claim for detrimental reliance. This is not an independent
cause of action, but rather an element of plaintiff’s promissory estoppel claim. See
Adams v. Wash. Group, LLC, 11 Misc.3d 1083(A), at *1 (Sup. Ct. Kings Co. 2006).
the basis of alter ego liability.
Subject Matter Jurisdiction
As a preliminary matter, defendants contend that the Court lacks subject matter
jurisdiction. The complaint alleges diversity jurisdiction pursuant to 28 U.S.C. § 1332, and
seeks $80,000 in compensatory damages. Compl. ¶14. Defendants contend that plaintiff’s
damages are limited to the amount plaintiff paid for the vehicles at auction, and thus fall
below the $75,000 amount in controversy requirement. The Court finds that plaintiff has
sufficiently alleged the requisite amount for purposes of satisfying diversity jurisdiction.2 See
St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-89 (1938) (“[T]he sum claimed by
the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal
certainty that the claim is really for less than the jurisdictional amount to justify dismissal.”);
see also Zacharia v. Harbor Island Spa, Inc., 684 F.2d 199, 202 (2d Cir. 1982) (“The jurisdictional
determination is to be made on the basis of the plaintiff’s allegations, not a decision on the
merits. Moreover, even where those allegations leave grave doubt about the likelihood of a
recovery of the requisite amount, dismissal is not warranted.”).
Carriage of Goods Sea Act
Defendants first move for partial summary judgment limiting Empire’s liability
pursuant to the Carriage of Goods Sea Act (“COGSA”). 46 U.S.C. § 30701 (note). COGSA
Because plaintiff’s claims are governed by the Carriage of Goods Sea Act, 46
U.S.C. § 30701 (note), the Court also has jurisdiction under 28 U.S.C. § 1333. See
Complaint of Tecomar S.A., 765 F. Supp. 1150, 1173 (S.D.N.Y. 1991).
applies “to all contracts for carriage of goods by sea between the ports of the United States and
the ports of foreign countries.” Nippon Fire & Marine Ins. Co. v. M.V. Tourcoing, 167 F.3d 99,
100 (2d Cir. 1999) (per curiam). Where applicable, the statute limits a carrier’s liability to “$500
per package . . . for any loss or damage to or in connection with the transportation of goods,”
unless a shipper otherwise declares a higher value prior to shipment. COGSA §4(5).
Defendants contend that COGSA governs plaintiff’s claims and limits Empire’s liability to
$500 per vehicle, or $1000 total.3 Plaintiff argues that COGSA does not apply to the
transaction, and that the statute’s limitation of liability provisions are likewise inapplicable
because it was denied a fair opportunity to declare a value in excess of $500 per vehicle.
Plaintiff also claims that defendants’ alleged participation in the thefts deprives Empire of
COGSA’s limitation of liability benefit. Plaintiff’s arguments are without merit.
Whether COGSA Applies to Plaintiff’s Claims
COGSA normally “covers the period from the time when the goods are loaded
on to the time when they are discharged from the ship.” COGSA §1(e). However, the statute
permits parties to expand the reach of its provisions beyond the time of loading and
unloading. COGSA §7. A carrier’s bill of lading provides evidence of such an agreement.4
COGSA Introductory Note; see also Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 29 (2004) (bill of
Whether COGSA limits a carrier’s liability is often resolved on summary
judgment. See, e.g., Prebena Wire Bending v. Transit Worldwide Corp., 1999 WL 1293473, at
*2 (S.D.N.Y. June 2, 1999); Ins. Co. of N. Am. v. Blue Star, Ltd., 1997 WL 345235, at *4
(S.D.N.Y. June 20, 1997).
Subsequent to receiving a shipper’s goods, a carrier “shall, on demand of the
shipper, issue to the shipper a bill of lading” providing information including marks for
identifying the goods, the number of packages or pieces received, and the condition of
the goods. COGSA §3(c).
lading extended COGSA to cover the entire period in which the machinery would be under
the carrier’s responsibility).
Empire’s house bills of lading incorporate COGSA by reference and expand the
statute’s coverage as follows:
The Carrier undertakes responsibility from the place of receipt if
named herein or from the port of loading to the port of discharge
or the place of delivery if named hereto as follows: Where loss or
damage has occurred between the time of receipt of the Goods by
the Carrier at the port of loading and the time of delivery by the
Carrier at the port of discharge, or during any prior or subsequent
period of carriage by water, or where it cannot be established
where the loss or damage occurred, the liability of the Carrier
shall be determined in accordance with the provisions of the
International Convention for the Unification of Certain Rules
relating to Bills of Lading dated Brussels the 25th August, 1924
such as the Carriage of Goods by Sea Act 1924 of the United
Kingdom, or where compulsorily applicable the Carriage of
Goods by Sea Act of the United States 1936 or of like statutes of
other countries. If anything herein contained be inconsistent with
the said Acts or Laws it shall to the extent and on the occasion of
such inconsistency and no further, be null and void.
Hitrinov Aff. Ex. 4. Thus, if COGSA applies to a given transaction, Empire’s liability for loss
or damage to related goods is limited to $500 per package unless the shipper has otherwise
declared a higher value. If COGSA does not apply, Empire’s liability is not subject to the $500
per package limitation.
Empire’s house bills of lading identify the place of receipt as the company’s
storage facility in Elizabeth, New Jersey. Hitrinov Aff. Ex. 4; see also Hitrinov Aff. Ex. 2, Tariff
Rule 8 Part 4. Empire’s practice is to issue house bills of lading upon loading of the cargo onto
an ocean carrier. Hitrinov Aff. ¶ 13. As acknowledged by counsel during oral argument,
copies of these house bills of lading are thereafter electronically transmitted to a shipper.
Because plaintiff’s vehicles were stolen prior to being loaded onto an ocean carrier, Empire
had not yet issued bills of lading for the two vehicles. Plaintiff argues that Empire’s failure
to do so precludes COGSA and its terms from applying to the transaction and the related
claims. This argument is unpersuasive.
“[I]t is not unusual to issue a bill of lading after a carrier has taken possession
of cargo[,] and courts have regularly held that this does not prevent parties from being bound
by its terms.” Anvil Knitwear, Inc. v. Crowley Am. Transp., Inc., 2001 WL 856607, at *2 (S.D.N.Y.
July 27, 2001); see also Berkshire Knitting Mills v. Moore-McCormack Lines, Inc., 265 F. Supp. 846,
848 (S.D.N.Y. 1965) (“The fact that the bill of lading had not yet been issued, did not alter the
contractual relationship of the parties.”). Rather, “[w]here a shipper has ‘common business
experience’ with carriers such that it should know a carrier will issue a custom bill of lading,
the [unissued] bill of lading applies to the transaction.” Russul Corp. v. Zim Am. Integrated
Shipping Servs., 2009 WL 3247141, at *3 (S.D.N.Y. Oct. 5, 2009) (“It is well-settled that as long
as a bill of lading would have been issued in the ordinary course of business, the bill of lading
serves as the contract governing the relationship of a shipper and carrier even if it was not
actually issued.”) (citation omitted). Thus, where a shipper has knowledge as to the contents
of a carrier’s standard bill of lading, the parties may be bound by its terms even where a bill
of lading has not been issued for the particular goods in question. See, e.g., Berkshire, 265 F.
Supp. at 848 (“The form of the bill of lading was concededly known, and as a matter of
common business experience in transactions of this nature both parties must be deemed
bound by the terms it contained.”); Garnay, Inc. v. M/V Lindo Maersk, 816 F. Supp. 888, 894
(S.D.N.Y. 1993) (holding that bill of lading issued for two surviving containers governed a lost
container, provided that the issued bill of lading was the carrier’s standard form bill of lading).
The evidence demonstrates that “prior to the thefts at issue in this case, [plaintiff]
had an established business relationship with Empire, having shipped hundreds of
automobiles a year with the assistance of Empire since 2008.” 56.1 Statement ¶4; Compl. ¶¶
9, 12; Lachinsky Aff. ¶9. During oral argument the parties confirmed that over the course of
their business relationship, Empire had issued, and plaintiff had received, standard bills of
lading containing the above-referenced language. Hitrinov Aff. ¶ 13, Ex. 4; Lachinsky Aff.
¶32. Plaintiff does not claim it was unaware of Empire’s practice of issuing of bills of lading
at the time of loading vehicles onto an ocean carrier. Additionally, the evidence contradicts
plaintiff’s assertion that it was somehow unaware of the terms contained in Empire’s bills of
lading—specifically the limited liability provision. Empire had advised plaintiff in 2008 that
Empire was responsible for a maximum of up to $500 per vehicle in the event of damage or
loss while vehicles were in its warehouse. At that same time Empire informed plaintiff that
it could purchase additional insurance if more coverage was needed. Def.’s Reply Br. Ex. 1.
Plaintiff concedes that it then purchased such additional coverage and paid a corresponding
insurance premium. Lachinsky Aff. ¶ 30; Hitrinov Aff. Ex. 5.
Accordingly, the parties are bound by those standard terms contained in the bills
of lading Empire would have issued to plaintiff upon the loading of its vehicles onto an ocean
carrier. See Berkshire, 265 F. Supp. at 848 (parties bound by terms of unissued bill of lading
incorporating COGSA, where bill of lading would have been issued upon loading of cargo
onto vessel); Mack Trucks, Inc. v. Farrel Lines, Inc., 1990 WL 3926, at *2 (S.D.N.Y. Jan. 16, 1990)
(parties bound by terms of unissued standard bill of lading incorporating COGSA and
extending its provisions); Russul Corp., 2009 WL 3247141, at *3 (unissued bill of lading
incorporating COGSA was controlling, particularly in light of the “numerous prior shipments
that had occurred between [the parties] with fully issued bills of lading . . . .”).
Empire’s house bills of lading provide that it undertakes responsibility for
plaintiff’s vehicles beginning at the time of their receipt at Empire’s facility in Elizabeth, New
Jersey. Hitrinov Aff. Ex. 4. From this point forward, COGSA’s terms govern any loss or
damage to the vehicles. Id. Because the vehicles were stolen subsequent to their delivery to
Empire’s facility, COGSA applies to the transaction underlying plaintiff’s claims and limits
Empire’s liability accordingly. See COGSA §§4(5), 7; Hitrinov Aff. Ex. 4; ¶ 24; 56.1 Statement
¶ 14; see also Mack Trucks,1990 WL 3926, at *2 (unissued bill of lading incorporating COGSA
governed the parties’ transaction and limited defendants’ liability to $500).5
While plaintiff now argues that it had not “booked” the two vehicles with
Empire for transportation to Finland, both the evidence and plaintiff’s own statements
belie this contention. First, plaintiff elsewhere acknowledges that it “booked” the two
automobiles with Empire “to be transported from auctions sites in Ohio and Virginia to
Kotka, Finland.” Pl.’s 56.1 Statement ¶3; see also Comp. ¶¶ 14, 42. Defendants provide
evidence that as a result of the parties’ established course of dealing, they understood
that unless otherwise specified, plaintiff’s vehicles were to be transported to Finland
and “the only information which needed to be provided in order to book an automobile
for transportation was the year, make, model, color, vehicle identification number, and
location of the automobile” where it was to be transported from. Hitrinov Aff. ¶ 8.
Plaintiff does not dispute that it sent this information for the two BMW vehicles to
Empire via email on October 20, 2010 and October 21, 2010. See Hitrinov Aff., Ex. 6.
Upon receiving this information, Empire then arranged for plaintiff’s two vehicles to be
transported from their respective auction locations to its facility in Elizabeth, New
Jersey, where the thefts occurred. Hitrinov Aff. ¶¶ 9, 21-22. Finally, the vast majority of
plaintiff’s claims rely upon its having “booked” the two vehicles with Empire for
transportation to Finland. See, e.g., Compl. ¶¶ 25-26 (breach of contract claim alleging
that the parties had an agreement for “the transportation of [the] two BMW vehicles 
to Kotka in Finland,” and that plaintiff had “performed all of its obligations under the
contract that it was required to perform.”); ¶ 27(a) (defendants failed “to deliver the
vehicles to the agreed destination [Finland]” and “return the vehicles to Plaintiff.”); see
Plaintiff next argues that even if COGSA governs, the statute’s limitation of
liability provision is nonetheless inapplicable because it was denied a fair opportunity to
declare a value in excess of $500 per vehicle. This argument is likewise without merit.
“Under the ‘fair opportunity’ doctrine, the COGSA [$500 per package] limit is
inapplicable if the shipper does not have a fair opportunity to declare higher value and pay
an excess charge for additional protection.” Nippon, 167 F.3d at 101 (citing Gen. Elec. Co. v.
M.V. Nedlloyd, 817 F.2d 1022, 1028 (2d Cir. 1987)); see also COGSA §4(5). “Absent fair
opportunity, a carrier loses the benefit of any limitation of liability to which it otherwise might
be entitled.” Gen. Elec., 817 at 1029. In determining whether a shipper received such a fair
opportunity, “[t]he carrier bears the initial burden . . . [and] [p]rima facie evidence of that
opportunity is established when it can be gleaned from the language contained in the bill of
lading.” Id.; see also Petition of Isbrandtsen Co., 201 F.2d 281, 285 (2d Cir. 1953). If a carrier is
able to demonstrate fair opportunity, “the burden of proof shifts to the shipper to demonstrate
that a fair opportunity did not in fact exist.” Gen. Elec., 817 at 1029.
A carrier may “establish prima facie evidence of fair opportunity by showing
that bills of lading . . . specifically state that the shipper will have to declare excess liability in
order to avoid the limitation and/or  specifically incorporate COGSA by name in the bill of
lading.” MacSteel Int’l v. M/V IBN Abdoun, 154 F. Supp. 2d 826, 833 (S.D.N.Y. 2001) (“[A]s a
bare minimum, clear and unambiguous incorporation of COGSA by name in the bill of lading
is sufficient to establish that the shipper had fair opportunity.”); see also Ins. Co. of N. Am. v.
also Compl. ¶¶ 38(a-b), 64(a-b), 75 (a-b).
M/V Xiang He, 1990 WL 121587, at *4 (S.D.N.Y.1990) (finding that bill of lading satisfied fair
opportunity test where it explicitly incorporated COGSA and specifically stated that shipper
would have to declare excess value in order to avoid COGSA’s liability limitations). Likewise,
a carrier satisfies its prima facie burden where language in the bill of lading incorporates
COGSA’s provisions and provides space for a shipper to declare excess value. See Gen. Elec.,
817 at 1029 (carrier satisfied its burden where bill of lading incorporated COGSA by reference
and provided a space for declaring excess value); see also Nippon, 167 F.3d at 101 (shipper
received fair opportunity where the bill of lading limited liability to $500 per package and
provided a space for stating a higher value).
The language contained in Empire’s bill of lading is sufficient to satisfy its prima
In no event shall the Carrier be or become liable for any loss of or
damage to or in connection with the Goods in an amount
exceeding the limit per package or unit . . . provided for by the
United States Carriage of Goods by Sea Act, Section 4(5) or by any
similar act in force according to the provisions of clause 4 unless
the nature and value of such goods have been declared by the
Shipper before shipment, agreed by the Carrier, inserted in the Bill
of Lading and moreover freight paid on “ad valorem” basis.
Hitrinov Aff. Ex. 4, BOL Clause 5. Thus, plaintiff must “demonstrate that a fair opportunity
did not in fact exist.” Gen. Elec., 817 at 1029. While plaintiff maintains that it was deprived of
a fair opportunity to declare excess value, it provides no evidentiary support for this
conclusion.6 Moreover, plaintiff does not contend that it “even desired to make such a
declaration.” Xiang He, 1990 WL 121587, at *4 (granting defendant’s motion for partial
During oral argument plaintiff remained unable to identify evidentiary support
demonstrating that it was deprived of a fair opportunity to declare excess value.
summary judgment limiting liability under COGSA where plaintiff failed to provide “any
evidence showing that a fair opportunity . . . did not in fact exist . . . .”). As plaintiff has not
met its burden of showing that a fair opportunity did not exist, COGSA’s limitation of liability
provision applies. See id.; Assoc. Metals & Minerals Corp. v. M/V Olympic Mentor, 1995 WL
794062, at *12 (S.D.N.Y. Dec. 20, 1995) (finding COGSA’s $500 limitation applied where
plaintiff “presented no evidence that [fair opportunity] did not exist.”); Goga v. Zim Am.
Integrated Shipping Servs. Co., 2008 WL 2875059, at *6-7 (S.D.N.Y. July 25, 2008) (granting
defendant’s motion for partial summary judgment limiting liability to $500 where plaintiff
failed to offer “any evidence that [an intermediary] did not have a fair opportunity to declare
excess value . . . .”).
Finally, plaintiff contends that COGSA’s limitation of liability provision does not
apply because defendants engaged in “unreasonable deviations that nullify [the] limitations
of liability found in COGSA.” Specifically, plaintiff argues that defendants “participated in
or facilitated the theft of the vehicles, deliberately concealed the theft, and purposely
sabotaged Plaintiff’s efforts to locate the vehicles after the theft.” Pl.’s Opp’n Br. at 11.
While it is true that certain “unreasonable deviations” may deprive a carrier of
COGSA’s benefits, B.M.A. Indus. v. Nigerian Star Line, Ltd., 786 F.2d 90, 91 (2d Cir. 1986), the
Second Circuit has specifically limited the doctrine “to two situations: geographic deviation
and unauthorized on-deck stowage.” Sedco, Inc. v. S.S. Strathewe, 800 F.2d 27, 31 (2d Cir. 1986)
(citing B.M.A., 786 F.2d at 91-92; Italia di Navigazione, S.p.A v. M.V. Hermes I, 724 F.2d 21 (2d
Cir. 1983)). Neither of these situations is present here. Furthermore, the Second Circuit has
pointedly refused to extend the unreasonable deviation doctrine to include “corrupt or
criminal” acts. See B.M.A., 786 F.2d at 91-92 (refusing to find an unreasonable deviation where
plaintiff “alleged criminal receipt of a bribe in connection with  misdelivery”); see also Hermes
I, 724 F.2d at 22 (holding that “systematic thefts” by a carrier’s officers did not constitute an
unreasonable deviation); Iligan Integrated Steel Mills, Inc. v. S.S. John Weyerhauser, 507 F.2d 68,
71-72 (2d Cir. 1974) (refusing to expand the doctrine to include “gross negligence or wanton
and wilful misconduct in tendering an unseaworthy ship.”). Plaintiff therefore has not
demonstrated that defendants’ actions constituted an unreasonable deviation such that the
latter should be deprived of COGSA’s limitation of liability provisions.
Hitrinov’s Individual Liability
Defendants also move for summary judgment on plaintiff’s claims alleged
against Hitrinov in his individual capacity. Plaintiff asserts that Hitrinov is personally liable
for its losses because Empire was Hitronov’s alter ego. Compl. ¶ 5. However, plaintiff fails
to provide evidence sufficient to pierce the corporate veil.
A party seeking to pierce the corporate veil, and thereby impose personal
liability on an owner, must demonstrate that the corporation “has been used to achieve fraud,
or . . . been so dominated by an individual . . . and its separate identity so disregarded, that it
primarily transacted the dominator’s business rather than its own and can be called the other’s
alter ego.” Gartner v. Snyder, 607 F.2d 582, 586 (2d Cir. 1979) (“New York courts disregard
corporate form reluctantly.”). In making this determination, the following factors are relevant:
“[T]he intermingling of corporate and personal funds, undercapitalization of the corporation,
failure to observe corporate formalities such as the maintenance of separate books and records,
failure to pay dividends, insolvency at the time of a transaction, siphoning off of funds by the
dominant shareholder, and the inactivity of other officers and directors.” Bridgestone/Firestone,
Inc. v. Recovery Credit Servs., 98 F.3d 13, 18 (2d Cir. 1996). Importantly, the Second Circuit has
recognized that “with respect to small, privately-held corporations, ‘the trappings of
sophisticated corporate life are rarely present,’ and we must avoid an over-rigid
‘preoccupation with questions of structure, financial and accounting sophistication or
dividend policy or history’.” Id. (quoting William Wrigley Jr. Co. v. Waters, 890 F.2d 594, 600-01
Plaintiff has not provided any evidence that Hitrinov “so dominated” Empire
that the corporation could be called his alter ego. While plaintiff points to evidence that
Hitrinov was Empire’s sole shareholder, “[c]ontrol through 100% stock ownership does not
in itself constitute a[n] [individual] the alter ego of the [corporation].” Bellomo v. Pa. Life Co.,
488 F. Supp. 744, 745 (S.D.N.Y. 1980); see also Tycoons Worldwide Group Pub. Group, 721 F. Supp.
2d 194, 206-206 (S.D.N.Y. 2010) (finding fact that individual was the President and majority
owner of the company was not “in itself, a basis for piercing the corporate veil.”) (citing
sources). And while plaintiff points to Hitrinov’s statements that he did not know how many
shares Empire was authorized to issue, nor how many shares were issued upon incorporation,
this lack of knowledge is again an insufficient basis to pierce the corporate veil. See United
States v. Hued, 1992 WL 346877, at *3 (S.D.N.Y. Nov. 10, 1992) (granting summary judgment
on alter ego claims where plaintiff argued for veil piercing because defendant could not recall
if the corporation had ever issued an annual report).
Although plaintiff seeks to rely upon Hitrinov’s “unfamiliarity with the concept
of a company treasurer and/or secretary,” Pl.’s Opp’n Br. at 13, the evidence demonstrates
that this is due to Hitrinov’s limited grasp of the English language. See Lachinsky Aff. Ex. 2,
Hitrinov Dep. 100-05. The evidence establishes that Empire was a “small company,” where
Hitrinov and Empire’s employees shared responsibility for a number of tasks, including
maintenance of the company’s books and records. Id. at 100-05 (“Each and everyone d[id]
everything.”). Thus, while Empire may not have observed many of the formalities common
to a larger company, this lack of corporate formalities again does not provide a basis for
holding Hitrinov personally liable. See Bridgestone/Firestone, 98 F.3d at 18 (“[W]ith respect to
small, privately-held corporations . . . we must avoid an over-rigid preoccupation with
questions of structure, financial and accounting sophistication or dividend policy or history.”).
Importantly, there is no evidence that Hitrinov intermingled Empire’s corporate
funds with his own, used the company’s corporate funds for his own purposes, failed to
maintain adequate books and records, or otherwise used Empire “to further personal rather
than corporate ends.” See Tycoons, 721 F. Supp. 2d at 206 (finding a similar lack of evidence
required granting summary judgment on alter ego claims); see also Primex Plastics Corp. v.
Lawrence Prods. Inc., 1991 WL 183367, at *6-7 (S.D.N.Y. Sept. 12, 1991) (dismissing alter ego
claim where the alleged facts did not suggest that the corporation “was a ‘dummy’
corporation” for the individual). As plaintiff has not established a basis for piercing the
corporate veil, summary judgment is granted on the claims alleged against Hitrinov on the
basis of alter ego liability.
Defendants’ motion for partial summary judgment limiting Empire’s liability is
granted; defendants’ motion for summary judgment on the claims alleged against Hitrinov
is also granted. This case will be dismissed upon defendants’ notifying the Court that they
have tendered $1000 to plaintiff.
Senior United States District Judge
Brooklyn, New York
March 29, 2013
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