Justice Melissa Crane

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NetJets Sales (NJS) leased and sold fractional interests in aircraft. Phoenix Star Capital (PSC), founded by Eckert and Gerson, was an asset management firm that leased an interest in an aircraft; Gerson signed the lease as PSC’s president. NJS sued PSC, and its principals, alleging a failure to pay amounts owed under the lease. Eckert moved to dismiss the complaint against him, while NJS obtained a default judgment against Gerson and PSC for their non-appearance. Eckert claimed he did not sign the contract in any capacity, thus, could not be liable. NJS relied on allegations in the complaint supporting an alter ego/piercing the corporate veil theory. The court found NJS alleged sufficient facts for Eckert to remain a defendant, noting he admitted PSC never became a viable business, and all assets were liquidated in 2014. Yet, he used the aircraft for nonbusiness purposes, but attempted to avoid paying for the services, and rose to the level of abusing the corporate form to commit a wrong against NJS. Dismissal of the contract breach and account stated claims was denied. The court found the breach of covenant of good faith and fair dealing claim was premised on an alleged failure to pay—a contract breach—thus, was duplicative of the contract claim, granting dismissal.

Justice Melissa Crane

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NetJets Sales (NJS) leased and sold fractional interests in aircraft. Phoenix Star Capital (PSC), founded by Eckert and Gerson, was an asset management firm that leased an interest in an aircraft; Gerson signed the lease as PSC’s president. NJS sued PSC, and its principals, alleging a failure to pay amounts owed under the lease. Eckert moved to dismiss the complaint against him, while NJS obtained a default judgment against Gerson and PSC for their non-appearance. Eckert claimed he did not sign the contract in any capacity, thus, could not be liable. NJS relied on allegations in the complaint supporting an alter ego/piercing the corporate veil theory. The court found NJS alleged sufficient facts for Eckert to remain a defendant, noting he admitted PSC never became a viable business, and all assets were liquidated in 2014. Yet, he used the aircraft for nonbusiness purposes, but attempted to avoid paying for the services, and rose to the level of abusing the corporate form to commit a wrong against NJS. Dismissal of the contract breach and account stated claims was denied. The court found the breach of covenant of good faith and fair dealing claim was premised on an alleged failure to pay—a contract breach—thus, was duplicative of the contract claim, granting dismissal.