Canoo Technologies, Inc. v. Harbinger Motors, Inc.
2:22-cv-09309
C.D. Cal.
Feb 7, 2025
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Docket

CANOO TECHNOLOGIES, INC., Plaintiff, v. HARBINGER MOTORS, INC., et al., Defendants.

Case No. 2:22-cv-09309-FLA (JCx)

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA

February 7, 2025

Document 244; #:14958

ORDER TO SHOW CAUSE WHY COURT SHOULD NOT DISMISS ACTION FOR LACK OF STANDING

On December 22, 2022, Plaintiff Canoo Technologies, Inc. (“Plaintiff“) filed this lawsuit against Defendants Harbinger Motors, Inc., Alexi Charbonneau, Benjamin Dusastre, William Eberts, Michael Fielkow, John Henry Harris, Phillip Weicker, Bharat Forge Limited, and Tiger Global Management, LLC (collectively, “Defendants“), along with other former Defendants that have been dismissed from the action. Dkt. 1 (“Compl.“).

In the operative First Amended Complaint (“FAC“), filed March 24, 2023, Plaintiff alleges it is an electric automotive company that develops technology in the electric vehicle market, “including technology related to its independent platform called the ‘skateboard.‘” Dkt. 96 (“FAC“) ¶ 2. According to Plaintiff, it invested considerable time and resources to develop proprietary skateboard-related technology and explored partnerships and joint venture opportunities with third-party original equipment manufacturers. Id. ¶¶ 2, 35-38. Plaintiff further claims Defendants improperly acquired and used its confidential technology and business plans to “develop[] a business model targeting” similar partnerships and technology at an “implausibly fast speed.” Id. ¶¶ 10, 91.

On January 17, 2025, Plaintiff filed a voluntary petition for relief under Chapter 7 of the United States Bankruptcy Code, in the United States Bankruptcy Court for the District of Delaware, Case No. 1:25-10099-BLS. See Dkt. 243; Dkt. 243-1.

The filing of a bankruptcy petition creates a bankruptcy estate comprising property that includes “all legal or equitable interests of the debtor in property as of the commencement of the case,” with enumerated exceptions. 11 U.S.C. § 541(a)(1); see also . “It is well settled that prepetition causes of action are assets included within the meaning of property of the estate.” (citing, e.g., ); see also ; .

A Chapter 7 debtor “may not prosecute a cause of action belonging to the bankruptcy estate” because the bankruptcy trustee is the “real party in interest” with respect to such claims. (citing & ); see also Fed. R. Civ. P. 17(a) (“An action must be prosecuted in the name of the real party in interest.“). To circumvent this proscription, a debtor must either show that its claims are exempt from the bankruptcy estate or were abandoned by the bankruptcy trustee. . Alternatively, a debtor may substitute or join the bankruptcy trustee as a party to the lawsuit. (“A trustee in bankruptcy is the representative of the estate, and has the capacity to sue and be sued“) (citing 11 U.S.C. § 323)).

Here, it is undisputed the transactions giving rise to Plaintiff‘s lawsuit occurred before it filed the petition for Chapter 7 bankruptcy, and Plaintiff‘s claims now appear to be property of the bankruptcy estate. Compare Compl. with Dkt. 243-1. Accordingly, the court ORDERS Plaintiff to Show Cause (“OSC“) in writing within fourteen (14) days of this order why the action should not be dismissed without prejudice for Plaintiff‘s lack of standing. See (dismissing complaint for lack of standing after plaintiff filed for Chapter 7 bankruptcy). Plaintiff is advised that failure to respond to the OSC timely may result in the dismissal of the action without further notice from the court.

IT IS SO ORDERED.

Dated: February 7, 2025

FERNANDO L. AENLLE-ROCHA

United States District Judge

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