Court Opinion

ID: 176742
Source: CourtListenerOpinion
Date Created: 2010-10-07 00:01:47+00
Date Added: 2024-06-11T17:25:39.546142
License: Public Domain

FILED
                               NOT FOR PUBLICATION                                        OCT 06 2010

                                                                                     MOLLY C. DWYER, CLERK
                       UNITED STATES COURT OF APPEALS                                  U.S. COURT OF APPEALS

                                FOR THE NINTH CIRCUIT

 BACKYARD WRESTLING, INC., a                            No. 09-55589
 Delaware corporation,
                                                        D.C. No. 5:07-cv-00527-SGL-JCR
                Plaintiff - Appellee,

   v.                                                   MEMORANDUM*

 PRO-ACTIVE ENTERTAINMENT
 GROUP, INC., a California corporation;
 LEN LEVY, an individual; RICHARD
 MENDELSOHN, an individual,

                Defendants,

   and

 WENCESLADO HERRERA, AKA
 Wayne Herrera, DBA Distinctive Movie
 Network, DBA Movie Network, Inc., DBA
 Wayne Enterprises,

                Defendant - Appellant.

                      Appeal from the United States District Court
                          for the Central District of California
                      Stephen G. Larson, District Judge, Presiding

         *
              This disposition is not appropriate for publication and is not precedent except as
provided by 9th Cir. R. 36-3.
                          Argued and Submitted June 9, 2010
                                 Pasadena, California

Before: GOODWIN and RAWLINSON, Circuit Judges, and MARBLEY, United
States District Judge.**

       Defendant-Appellant (“Herrera”) appeals from a judgment for the plaintiff,

asserting two grounds for vacating the judgment: 1) Plaintiff-Appellee (“BWI”)

was a void Delaware corporation, thereby lacking the capacity to sue, and thus

BWI did not satisfy the requirements for Article III standing; and 2) the district

court made erroneous findings of fact at the prove-up hearing following a default

judgment. We have jurisdiction under 28 U.S.C. § 1291 and we affirm the

judgment.

       Herrera claims that under Delaware law (BWI is a Delaware corporation), a

void corporation loses its capacity to sue except as to matters related to winding up

the business of the corporation. See Del. Code Ann. tit. 8, § 278. BWI is not a

dissolved corporation, but rather a once-void and now-renewed corporation.

Under Delaware law, where a corporation was void but then renewed, it is as

though the corporation was never void, and the corporation regains all of its

previous rights, including capacity to sue. Frederic G. Krapf & Son, Inc. v.

        **
               The Honorable Algenon L. Marbley, United States District Judge for the Southern
District of Ohio, sitting by designation.

                                              2
Gorson, 243 A.2d 713, 715 (Del. 1968), BWI submitted to this Court a

Certificate of Renewal, which indicates that BWI became a void corporation for

failure to pay taxes on March 1, 2009, and then received a Certificate of Renewal

on December 8, 2009 and a Certificate of Good Standing on January 14, 2010.

Accordingly, Herrera’s argument fails and the judgment of the district court must

be upheld despite BWI’s void status from March 1, 2009 to December 8, 2009.

Under Del. Code Ann. tit. 8, § 312(e), and applying Krapf, even if BWI lacked

capacity to sue at the time of the district court’s March 19, 2009 judgment on

damages and entry of permanent injunction, the fact that BWI has been reinstated

through the Certificate of Renewal results in a validation of all its corporate acts,

including suit against Herrera.

      The findings of fact challenged by Herrera were made at the prove-up

hearing on damages. We review the district court’s findings of fact for clear error,

and must be “left with the definite and firm conviction that a mistake has been

committed.” Household Credit Serv. v. Ettell (In re Ettell), 188 F.3d 1141, 1145

(9th Cir. 1999); Zivkovic v. S. Cal. Edison Co., 302 F.3d 1080, 1088 (9th Cir. 2002).

No finding of fact was clearly erroneous.

AFFIRMED.

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