Aaron Carlson Corp. v. Cohen
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The Supreme Court reversed the decision of the court of appeals affirming the judgment of the district court concluding that a receiver should bring a piercing-the-corporate-veil claim against the shareholders of the corporate entity that the receiver controls, holding that the receiver in this case did not have the power to bring the veil-piercing claims.
Aaron Carlson Corporation, one of the creditors of the now-defunct LSI Corporation of America, Inc. (LSI), sought to pierce the LSI corporate veil and recover from Respondents. The district court concluded that the corporation's claims should have been brought by a receiver that had been appointed in a lawsuit that Respondents had filed against LSI. In that suit, the receiver had sold LSI's assets and repaid some of LSI's creditors. The court of appeals affirmed. The Supreme Court reversed, holding (1) the receiver did not have the power to bring veil-piercing claims; and (2) therefore, the corporation's claims against the shareholders did not represent an impermissible collateral attack on the receivership and were not barred by res judicata.
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