On November 19, 2021, Justice Reed of the New York County Commercial Division issued a decision in Roxx Alison Ltd. v, Shutle, Inc., 2021 NY Slip Op. 51102(U), holding that a corporate officer who participates in the commission of a tort may be held individually liable for that tort, explaining:
The second and sixth causes of action in the verified complaint allege the conversion of jewelry, loose diamonds, models and molds belonging to plaintiff by Shutle, Spectrum and Israelov. Defendants argue that Israelov should not be held individually responsible for the conversion claims. Defendants argue that the complaint does not establish a cause of action against Israelov under a theory of veil piercing. Plaintiff argues that it never pled veil piercing and does not need to rely on veil piercing to make out a conversion claim against Israelov.
There is case law to support plaintiff’s position. It has long been held by the Appellate Division, First Department that a corporate officer who participates in the commission of a tort may be held individually liable, regardless of whether the corporate veil is pierced. Moreover, a director may be held individually liable to third parties for a corporate tort if he either participated in the tort or else directed, controlled, approved, or ratified the decision that led to the plaintiff’s injury.
Plaintiff alleges conversion — a tort — by Shutle, Spectrum, and Israelov. Plaintiff alleges that Israelov is the controlling shareholder, director officer and/or employee of both Shutle and Spectrum. Therefore, Israelov may be held individually liable if he personally participated in the tort, as plaintiff alleges. Taking these allegations as true, the conversion claims survive.
(Internal quotations and citations omitted).