Horsehead Indus. v. Metallgesellschaft AG

In Horsehead Indus. v. Metallgesellschaft AG (239 AD2d 171 [1st Dept 1997]) the Court stated that: "a parent company can be held liable as a party to its subsidiary's contract if the parent's conduct manifests an intent to be bound by the contract, which intent is inferable from the parent's participation in the negotiation of the contract, or if the subsidiary is a dummy for the parent, or if the subsidiary is controlled by the parent for the parent's own purposes." The Court also found that the cause of action for breach of a shareholder's agreement was properly sustained against the parent because the parent manifested an intent to be bound to the agreement through its negotiations on behalf of its then wholly-owned subsidiary and then later performed the act that allegedly breached the involved agreement.