Can a Nevada corporation in default sue in Federal or State court?

Question

A company that is in default incorporated in Nevada, is initiating a lawsuit against my firm. Can they legally file a lawsuit if they are in default status.

Answer 1

Yes they can.

"Default" simply means that they are late filling their Annual List of Officers with the Secretary of State.

To emerge from a "Default" status, all the corporation must do is pay a $75 late fee, and file the Annual List as Usual.

That is the only penalty, and only amounts to a "Late Fee".

The company has a right to transact business for one year while being in "Default".  It still legally exists.  It merely owes a late fee.

If the corporation remains in default for 12 months, then it's corporate charter is revoked, and its ability to transact business is forfeited.

Until that time, however, they still have the right to transact business, and file a lawsuit.

If at any time they pay the $75 late free (which can be done online), pay $125 to file their Annual List Of Officers (which can be one person), they will no longer be in default.

You should probably check the Secretary of State online database here:

https://esos.state.nv.us/SOSServices/Ano...

Type in the company name.

See if they are about to go into revocation.  If they are 10 or 11 months past due, then they may go into default before the suit is filed.

If they are only one or two months behind, they will probably simply pay the fee if they think they have a good chance of prevailing against you.

If they do sue you, you could bring up their "default" status to the judge.  Even though this probably wouldn't dismiss the suit automatically, it would effect the credibility of the corporation, and all things being equal, might help your case.

Regardless, good luck, and I hope things work out okay for you.