Sino Clean Energy, Inc. v. Seiden, No. 17-15316 (9th Cir. 2018)
Annotate this CaseThe Ninth Circuit affirmed the district court's decision affirming the bankruptcy court's dismissal of a Chapter 11 petition filed by the former board members of Sino. The panel held that the bankruptcy court properly dismissed the action because plaintiffs lacked corporate authority under Nevada law when they filed the petition where a receiver appointed by the Nevada state court already had removed them from the corporation's board of directors. Therefore, plaintiffs were not authorized to file the petition on behalf of the corporation.
Court Description: Bankruptcy The panel affirmed the district court’s affirmance of the bankruptcy court’s dismissal of a Chapter 11 bankruptcy petition filed by former board members of a corporation. The panel held that the former board members lacked corporate authority under Nevada law when they filed the bankruptcy petition because a receiver appointed by the Nevada state court already had removed them from the corporation’s board of directors. Accordingly, the former board members were not authorized to file the bankruptcy petition on behalf of the corporation.
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