Denis Facques v. Jérôme Theetten

19 April 2005, No. 05-10.094 (2005)

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Denis Facques v. Jérôme Theetten

France Court of Cassation
19 April 2005, No. 05-10.094 (2005)

Facts

SA Metaleurop (SA) (defendant) owned 99 percent of SAS Metaleurop (SAS) (defendant). SA contributed funds, administrative assistance and direction, financial deferrals, and coworkers to SAS. Extensive contractual dealings between the two companies were conducted, dominated by SA. SAS became insolvent, leading to insolvency and bankruptcy proceedings in the French first-degree court. The first-degree court appointed Jérôme Theetten and M. Martin (the liquidators) (plaintiffs) as liquidators. The liquidators asked the first-degree court to extend SAS’s liabilities to the parent, SA, based on asserted comingling of funds, joint activities and contractual dealings, and control by the parent. The first-degree court dismissed the request, and the liquidators appealed, arguing that SAS was a fictitious company for which SA must be held responsible. The appellate court appointed an expert to examine the extent of SAS’s dependence on SA. Based on the expert’s report, the appellate court agreed with the liquidators and extended liability to SA. SA appealed to the French Supreme Court, commercial division.

Rule of Law

Issue

Holding and Reasoning (Per curiam)

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