Business Associations Keyed to Hamilton
Stark v. Flemming
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Stark (P) held her assets in the newly formed corporation. It operated her duplex and farm, she paid herself a $400 monthly salary. Flemming (D) secretary of Health, Education, and Welfare (HEW) denied Social Security on the claim that Stark’s (P) corporation was a sham. The district court favored Flemming (D). The court agreed with Flemming (D) that Stark’s (P) only purpose for incorporating was to secure Social Security benefits.
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