On 26 April 2018, the Maritime and Commercial High Court found in favour of the Danish fashion design manufacturer Samsøe og Samsøe Whole Sale ApS (Samsøe og Samsøe) in proceedings against Elitko Denmark ApS (Elitko) and Elitko’s executive officer and sole shareholder, Jacob Rathsach.
The questions of the proceedings were whether Elitko had breached a distribution agreement with Samsøe og Samsøe and whether Elitko and Jacob Rathsach could be held liable for payment of a penalty and damages for the breach.
In connection with the purchase of surplus stock, the parties entered into a distribution agreement on the condition that Elitko was not allowed to resell the goods outside Russia. An agreed penalty of EUR 100,000 in case of breach was included in the agreement at the request of Jacob Rathsach.
Nevertheless, Elitko sold the goods to the Romanian company BE Retail. Shortly after, the goods appeared in e.g. Kvickly, a Danish supermarket chain.
The judgment holds Elitko liable for practically the entire amount claimed, and Jacob Rathsach is held personally liable for the entire claim for damages and the corresponding costs, but not for the contract penalty governed by the parties’ agreement for which the company is solely liable.
The judgment contributes to the case law on piercing of the corporate veil created in recent years.
Christina Type Jardorf argued the case for Samsøe og Samsøe before the Maritime and Commercial High Court.