On Oct. 17, in Kertesz v. GVC and Korn, the 2nd Circuit ruled that a defendant who seeks indemnification from a corporation suing him for misconduct as an executive doesn’t lose his right to pierce the corporate veil and find other company executives personally liable for that coverage.
The dispute in Kertesz v. GVC and Korn centers on two men and their ex-business organization, General Video Corporation (GVC). Although now defunct, GVC was a Delaware corporation in which Emery Kertesz (plaintiff-appellant) and Justin Korn (defendant-appellee) were the sole shareholders, owning 31.6 percent and 68.4 percent shares, respectively. GVC first brought an action against Kertesz in his capacity as a corporate officer in the Delaware Court of Chancery. Among other things, GVC’s complaint contained claims against Kertesz for alleged breach of fiduciary duties and tortious interference with business relations.