Some may view dissolution as the final curtain for a corporation and its shareholders.  But unlike mere mortals, a corporation does not strut and fret its hour upon the stage and then is heard no more.

The undead nature of dissolved corporations is illustrated by Judge Edward J.Davila’s recent ruling in Murabito v. Stericycle, Inc., 2015 U.S. Dist. LEXIS 29238 (N.D. Cal. Mar. 10, 2015).  That case started out in state court and was removed by the defendants to federal court based on diversity jurisdiction.  Plaintiff then moved to have the case back to state court.  Since the plaintiff was undisputedly a resident of California and one of the defendants was a California corporation with its principal place of business in California, diversity was seemingly destroyed.  However, the defendant corporation was dissolved.  Therefore, the defendants argued that the corporation’s domicile should be disregarded.

Judge Davila, citing Section 2011(a)(1), found that the Corporations Code makes clear that the corporation and its shareholders “still exist for the presentation and enforcement of claims”.  Accordingly, he found that the defendant corporation should not be disregarded for purposes of determining whether diversity jurisdiction existed.