Florida Court Denies Recognition of Russian Judicial Decision on Subsidiary Liability: Public Policy Violation and Lack of Reciprocity

On April 22, 2025, the Miami-Dade County Court (Florida) refused to recognize and enforce a decision of the Arbitration Court of the Irkutsk Region regarding subsidiary liability in the bankruptcy case of LLC “ProdTrade.” The claimed amount exceeded 840 million rubles (USD 10.3 million).

The court found that the Russian model of subsidiary liability contradicts Florida’s public policy as it presumes the controlling person’s guilt and shifts the burden of proof onto the defendant. Such regulation violates the fundamental principles of American justice, particularly the due process guaranteed by the U.S. Constitution.

The court also noted that the Russian standard for “piercing the corporate veil” differs significantly from Florida’s approach. Under Florida law, the plaintiff must prove that the defendant controlled the company to the extent of complete loss of corporate independence, used the corporate form for fraudulent purposes, and thereby caused damage to the plaintiff—only then is personal liability possible. Russian law, however, effectively presumes liability based on the mere fact of control.

An additional ground for denial was the lack of reciprocity: Russian courts, under current conditions, do not recognize similar decisions from U.S. courts as they are considered courts of an “unfriendly state,” making the principle of mutual enforcement of judicial acts impossible.

The Florida court’s decision sets a precedent: Russian judicial decisions on subsidiary liability based on presumptions and the public-law nature of recovery will likely be deemed unenforceable in the United States.