Case Name: Cornwall Management Ltd., et al., Respondents, v. Peter Kambolin et al., Appellants, et al., Defendants
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 2016-06-14
Citations: 140 A.D.3d 507
Docket Number: 
Parties: Cornwall Management Ltd., et al., Respondents, v Peter Kambolin et al., Appellants, et al., Defendants.
Judges: Concur — Friedman, J.P, Andrias, Moskowitz, Kapnick and Webber, JJ.
Reporter: Appellate Division Reports
Volume: 140
Pages: 507–508

Head Matter:
Cornwall Management Ltd., et al., Respondents, v Peter Kambolin et al., Appellants, et al., Defendants.
[33 NYS3d 254]

Opinion:
Order, Supreme Court, New York County (Melvin L. Schweitzer, J.), entered August 11, 2014, which, to the extent appealed from, denied defendants Peter Kambolin and Atlant Capital Holdings, LLC's motion to dismiss the cause of action for suit on judgment as against them, unanimously reversed, on the law, without costs, and the motion granted. The Clerk is directed to enter judgment dismissing the complaint as against said defendants.
The allegations that defendants Kambolin and Atlant Capital Holdings controlled and dominated defendant Thor United are insufficient to state a cause of action for alter ego liability (see e.g. 501 Fifth Ave. Co. LLC v Alvona LLC., 110 AD3d 494 [1st Dept 2013]; Morpheus Capital Advisors LLC v UBS AG, 105 AD3d 145, 153-154 [1st Dept 2013], revd on other grounds 23 NY3d 528 [2014]; Andejo Corp. v South St. Seaport Ltd. Partnership, 40 AD3d 407, 407 [1st Dept 2007]). The complaint alleges, upon information and belief, only that Kambolin, after relinquishing his interest in Thor United, continued to dominate it by controlling its bank account and decision making, and that Thor United and other entities controlled by Kambolin, including Atlant Capital, commingled funds and shared a business address. It alleges no specific facts to establish actions taken by Thor United or its owners in connection with the loans and the alleged scheme to avoid their repayment or that Kambolin's control of Thor United encompassed any such actions.
Nor does it allege any of the other factors that support a veil-piercing claim, such as a lack of corporate formalities or undercapitalization. Contrary to plaintiffs' argument, Tap Holdings, LLC v Orix Fin. Corp. (109 AD3d 167 [1st Dept 2013]) does not compel a different result. The operative pleading in Tap Holdings, unlike here, alleged that the owners of the entity whose veil the plaintiff sought to pierce abused the corporate form for the purpose of harming noteholders (id. at 175).
Concur — Friedman, J.P, Andrias, Moskowitz, Kapnick and Webber, JJ.