Canoo Technologies, Inc. v. Harbinger Motors, Inc.

• Court: District Court, C.D. California
• Decided: February 7, 2025
• Docket: 2:22-cv-09309
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 CANOO TECHNOLOGIES, INC., Case No. 2:22-cv-09309-FLA (JCx)

12 Plaintiff, ORDER TO SHOW CAUSE WHY 13 v. COURT SHOULD NOT DISMISS ACTION FOR LACK OF 14 STANDING 15 HARBINGER MOTORS, INC., et al., 16 Defendants. 17 18 19 On December 22, 2022, Plaintiff Canoo Technologies, Inc. (“Plaintiff”) filed 20 this lawsuit against Defendants Harbinger Motors, Inc., Alexi Charbonneau, Benjamin 21 Dusastre, William Eberts, Michael Fielkow, John Henry Harris, Phillip Weicker, 22 Bharat Forge Limited, and Tiger Global Management, LLC (collectively, 23 “Defendants”), along with other former Defendants that have been dismissed from the 24 action. Dkt. 1 (“Compl.”). 25 In the operative First Amended Complaint (“FAC”), filed March 24, 2023, 26 Plaintiff alleges it is an electric automotive company that develops technology in the 27 electric vehicle market, “including technology related to its independent platform 28 called the ‘skateboard.’” Dkt. 96 (“FAC”) ¶ 2. According to Plaintiff, it invested 1 considerable time and resources to develop proprietary skateboard-related technology 2 and explored partnerships and joint venture opportunities with third-party original 3 equipment manufacturers. Id. ¶¶ 2, 35–38. Plaintiff further claims Defendants 4 improperly acquired and used its confidential technology and business plans to 5 “develop[] a business model targeting” similar partnerships and technology at an 6 “implausibly fast speed.” Id. ¶¶ 10, 91. 7 On January 17, 2025, Plaintiff filed a voluntary petition for relief under Chapter 8 7 of the United States Bankruptcy Code, in the United States Bankruptcy Court for the 9 District of Delaware, Case No. 1:25-10099-BLS. See Dkt. 243; Dkt. 243-1. 10 The filing of a bankruptcy petition creates a bankruptcy estate comprising 11 property that includes “all legal or equitable interests of the debtor in property as of 12 the commencement of the case,” with enumerated exceptions. 11 U.S.C. § 541(a)(1); 13 see also In re Raintree Healthcare Corp., 431 F.3d 685, 688 (9th Cir. 2005). “It is 14 well settled that prepetition causes of action … are assets included within the meaning 15 of property of the estate.” Hernandez v. Downey Sav. & Loan Ass’n, F.A., Case No. 16 3:08-cv-02336-IEG-LSP, 2009 WL 704381, at *3 (S.D. Cal. Mar. 17, 2009) (citing, 17 e.g., Cusano v. Klein, 264 F.3d 936, 945 (9th Cir. 2001)); see also Rowland v. Novus 18 Fin. Corp., 949 F. Supp. 1447, 1453 (D. Haw. 1996); Cobb v. Aurora Loan Servs., 19 408 B.R. 351 (Bankr. E.D. Cal. 2009). 20 A Chapter 7 debtor “may not prosecute a cause of action belonging to the 21 bankruptcy estate” because the bankruptcy trustee is the “real party in interest” with 22 respect to such claims. Hernandez, 2009 WL 704381, at *5 (citing Rowland, 949 F. 23 Supp. at 1454 & Griffin v. Allstate Ins. Co., 920 F. Supp. 127, 130 (C.D. Cal. 1996)); 24 see also Fed. R. Civ. P. 17(a) (“An action must be prosecuted in the name of the real 25 party in interest.”). To circumvent this proscription, a debtor must either show that its 26 claims are exempt from the bankruptcy estate or were abandoned by the bankruptcy 27 trustee. Rowland, 949 F. Supp. at 1453–54. Alternatively, a debtor may substitute or 28 join the bankruptcy trustee as a party to the lawsuit. Runaj v. Wells Fargo Bank, 667 1 | F. Supp. 2d 1199, 1206 (S.D. Cal. 2009) (“A trustee in bankruptcy is the 2 | representative of the estate, and has the capacity to sue and be sued”’) (citing 11 U.S.C. 3 | § 323)). 4 Here, it is undisputed the transactions giving rise to Plaintiff’s lawsuit occurred 5 | before it filed the petition for Chapter 7 bankruptcy, and Plaintiff's claims now appear 6 | to be property of the bankruptcy estate. Compare Compl. with Dkt. 243-1. 7 | Accordingly, the court ORDERS Plaintiff to Show Cause (“OSC”) in writing within 8 || fourteen (14) days of this order why the action should not be dismissed without 9 | prejudice for Plaintiff's lack of standing. See EHang Inc. v. Wang, Case No. 5:21-cv- 10 | 02700-BLF, 2021 WL 5037681 (N.D. Cal. Oct. 29, 2021) (dismissing complaint for 11 | lack of standing after plaintiff filed for Chapter 7 bankruptcy). Plaintiff is advised that 12 | failure to respond to the OSC timely may result in the dismissal of the action without 13 | further notice from the court. 14 15 IT IS SO ORDERED. 16 17 | Dated: February 7, 2025 18 FERNANDO L. AENLLE-ROCHA United States District Judge 19 20 21 22 23 24 25 26 27 28 4qy