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Workers' Compensation

New York: Related Entity is Not Employer's Alter Ego; Tort Suit May Continue

Acknowledging that if one business entity was the alter ego of another, the former could not be sued in tort for injuries sustained by an employee of the "alter ego" entity, a New York appellate court found the defendant-business entity failed to establish that it was either (a) part of a single integrated entity or (b) that one of the two business entities controlled the day-to-day operations of the other. In the absence of such proof, the defendant was not entitled to the exclusive remedy defense in the civil action filed against it. Plaintiff worked as a pharmacist for CVS Rx Services, Inc. ("the employer"), which leased the pharmacy premises from a related entity, SVS Albany, LLC ("the landlord"). Plaintiff sustained injuries in a fall at work and filed suit against the landlord for negligence. The landlord maintained that the two entities were so closely related that it was not subject to suit. The appellate found, however, that while the landlord had shown a relationship between the two business entities, it had failed to establish that the two operated as a single integrated entity or that one of the two controlled the operations of the other.

Thomas A. Robinson, J.D., the Feature National Columnist for the LexisNexis Workers’ Compensation eNewsletter, is co-author of Larson’s Workers’ Compensation Law (LexisNexis).

LexisNexis Online Subscribers: Citations below link to Lexis Advance.

See Fazzolari v. Sun Enterprises, LLC, 2020 N.Y. App. Div. LEXIS 7545 (2d Dept. Dec. 9, 2020)

See generally Larson’s Workers’ Compensation Law, § 112.01.

Source: Larson’s Workers’ Compensation Law, the nation’s leading authority on workers’ compensation law

For a more detailed discussion of the case, see

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