Legal Question in Business Law in California

Re: Ratting out the CEO

If the Canadian company has a bank account, you should be able to levy against it. You might hire a good collections investigator to find that out. You should be circumspect about writing to the shareholders. Too often companies will go after a letter writer legally for defamation, thereby compounding the problem.

Re: Ratting out the CEO

A publicly-traded corporation does not have to tell its shareholders about all litigation in which it is involved. It is only required to disclose those matter which might foreseeably have a material impact on the company's finances. Since your case was in small claims court it almost surely did not meet this standard.

Sending the letter you describe would be legal but would probably be impractical. You might have a hard time getting the names and addresses of all the shareholders; even if you can get such a list, the cost of sending these materials to all of them might be enormous. Besides, this is not the sort of issue that causes shareholders to demand action.

Writing the directors makes a bit more sense since there are surely fewer of them and since their names and addresses should be easy to get. You might even get results this way. Keep in mind, though, that the CEO probably was not required to disclose your judgment to the board in light of its size. Directors do not need to hear about every detail of a company's operations; if they did, directors of large corporations like Exxon and Wal-Mart would spend all their time dealing with such reports and would be unable to run the companies.

The way to get your payment from a judgment debtor that has ignored your demands is not to make more demands. Instead, you should try to enforce the judgment in a Canadian court. Such enforcement actions are routine. Depending on the size of your judgment, though, such a step may not be cost-effective.

Re: Ratting out the CEO

In a nutshell, you want to take the most realistic and practical approach in collecting on your small claims judgment. We definitely understand your frustration in all of this, but you have better options in collecting than the ones you prescribe in your question. If you would like a free phone consultation on this matter, contact us directly today.

Re: Ratting out the CEO

What you need to do is find out what assets the debtor company has (preferably here in Californa) and then collect the judgment from those assets. One way to do this is to conduct a "debtor's examination." Forms and instructions are available on the website for the California Court of Appeal, http://www.courtinfo.ca.gov/selfhelp/smallclaims/debtorsexam.htm. Assuming you can get the information (i.e., that the debtor provides the information), you should be able to find out whether they have bank accounts in California.

You are welcome to contact me if you have any questions.