Cite as: 524 U. S. 51 (1998)
Opinion of the Court
executive officer," and on "the conduct of CPC officials with respect to Ott II affairs, particularly Arnold Ott"); id., at 558 ("CPC actively participated in, and at times controlled, the policy-making decisions of its subsidiary through its representation on the Ott II board of directors"); id., at 559 ("CPC also actively participated in and exerted control over dayto-day decision-making at Ott II through representation in the highest levels of the subsidiary's management").
In imposing direct liability on these grounds, the District Court failed to recognize that "it is entirely appropriate for directors of a parent corporation to serve as directors of its subsidiary, and that fact alone may not serve to expose the parent corporation to liability for its subsidiary's acts." American Protein Corp. v. AB Volvo, 844 F. 2d 56, 57 (CA2), cert. denied, 488 U. S. 852 (1988); see also Kingston Dry Dock Co. v. Lake Champlain Transp. Co., 31 F. 2d 265, 267 (CA2 1929) (L. Hand, J.) ("Control through the ownership of shares does not fuse the corporations, even when the directors are common to each"); Henn & Alexander 355 (noting that it is "normal" for a parent and subsidiary to "have identical directors and officers").
This recognition that the corporate personalities remain distinct has its corollary in the "well established principle [of corporate law] that directors and officers holding positions with a parent and its subsidiary can and do 'change hats' to represent the two corporations separately, despite their common ownership." Lusk v. Foxmeyer Health Corp., 129 F. 3d 773, 779 (CA5 1997); see also Fisser v. International Bank, 282 F. 2d 231, 238 (CA2 1960). Since courts generally presume "that the directors are wearing their 'subsidiary hats' and not their 'parent hats' when acting for the subsidiary," P. Blumberg, Law of Corporate Groups: Procedural Problems in the Law of Parent and Subsidiary Corporations § 1.02.1, p. 12 (1983); see, e. g., United States v. Jon-T Chemicals, Inc., 768 F. 2d 686, 691 (CA5 1985), cert. denied, 475 U. S. 1014 (1986), it cannot be enough to establish liability
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