(a) to "hand back the possession, operation and business of the Hotel to [Plaintiff]" within 31 days, including taking all practical measures needed to effect an orderly handover of the business with respect to the transition of Hotel guest and reservation data; (b) within 14 days of handing over the Hotel, to provide a full financial statement as of the handover date and [to] account to CGHA for all payments made by Woodman since December 31, 2012; and (c) to cease making any payments to any third party, including under the Operating Agreement, until the [a]rbitrators issued their final award on liability.
(Id. ¶ 70). The financial statements revealed that Woodman made payments totaling approximately $1 million to Starwood Hotels’ entities during 2013 and 2014. (Id. ¶ 71). Woodman made none of its required payments to Plaintiff during this time. (Id. ¶ 55). The arbitration award was issued on May 6, 2015 and found Woodman breached its obligations under the Management Agreement. (Id. ¶¶ 73, 76). Woodman has failed to make any payments on the arbitration award. (Id. ¶ 81).
A huge amount of wealth generation results from the use of distinct entities by corporate parents to conduct business. This allows parents to engage in risky endeavors precisely because the parents can cabin the amount of risk they are undertaking by using distinct entities to carry out certain activities. Delaware law respects corporate formalities, absent a basis for veil-piercing, recognizing that the wealth-generating potential of corporate and their limited liability entities would be stymied if it did otherwise.
Alliance Data Systems Corp. v. Blackstone Capital Partners V L.P., 963 A.2d 746, 769 (Del. Ch. 2008).
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