First Stop Book Shop, Inc. v. Matthews Book Co.
First Stop Book Shop, Inc. v. Matthews Book Co.
Opinion of the Court
This is an appeal from dismissal of action under the Sherman Anti-Trust Act, 15 U.S.C. §§ 1, 2, brought by statutory trustees of First Stop Book Shop, Inc. (First Stop) against Follett Corporation and its subsidiary Follett St. Louis University Book Store (collectively Follett) and four other defendants. The district court dismissed on the ground that the trustees lost the capacity to bring this suit on behalf of the dissolved corporation by unreasonable delay in filing suit. For the reasons discussed below, we reverse.
On January 1, 1977, First Stop forfeited its corporate charter in Missouri for failure to file its annual registration report as required by Mo.Stat.Ann. § 351.525 (Vernon Supp. 1979).
Less than five months later, on May 27, 1977, First Stop filed its first complaint in district court alleging that the defendants had combined to eliminate it as a competitor in the medical books and supplies market in St. Louis, Missouri. Because a dissolved corporation lacks capacity to sue, a motion was made by First Stop to substitute Thomas D. Moore, one of its statutory trustees, as real party in interest. On motion of Follett, the original lawsuit was dismissed without prejudice on October 25, 1978, for failure to join indispensable parties, namely all the statutory trustees as required by Mo.Stat.Ann. § 351.525 (Vernon Supp. 1979). Plaintiff appealed that decision, which was upheld by this court on May 4, 1979. Moore v. Matthews Book Co., 597 F.2d 645 (8th Cir. 1979).
The instant lawsuit was filed in district court on July 5, 1979, by Thomas D. Moore and Louise Moore, the sole surviving statutory trustees of First Stop. It is undisputed that the substance of the first and second lawsuits was the same. Follett' moved to dismiss on the ground that the trustees lacked capacity to sue because they did not bring suit within the time allowed by Missouri corporate survival statutes. • Although Mo.Stat.Ann. § 351.525 (Vernon Supp. 1979) sets no time limit for suits on behalf of corporations whose charters are forfeited,
The two state and two federal filings involved substantially the same cause of action.
Notwithstanding the ultimate adjudication that the first suit was brought by the wrong plaintiff, that defect was not apparent until a ruling from this court. In fact, we recognized then that there were no Mis
First Stop filed its second complaint within two months after our affirmance of the dismissal without prejudice. We disagree with the district court’s view that the trustees lost the capacity to bring this action “by unnecessarily delaying.” Under the circumstances, the trustees filed the instant complaint within a reasonable time after the corporate charter was forfeited.
Accordingly, we vacate the judgment of the district court and reverse and remand for further proceedings consistent herewith.
. In contrast, Mo.Stat.Ann. § 351.565 (Vernon 1966) sets a two-year limitation for suits on behalf of corporations which dissolved voluntarily. The district court imported this limit as a guideline.
. The first federal petition did not name as defendants Matthews Medical and Scientific Book Company and McCoy Surgical Supplies, Inc., the subsidiaries through which defendant Matthews Book Company allegedly acted. They were named in the second federal petition. The second federal petition also added attempted monopoly to the other antitrust allegations.
. Follett says that Missouri public policy favors prompt liquidation and distribution of corporate assets. While this is true, Missouri law requires only that suits be brought within a reasonable time, which this one was. Missouri law does not limit the time spent in litigation.
Reference
- Full Case Name
- FIRST STOP BOOK SHOP, INC., Thomas D. Moore Louise Moore as Trustees of First Stop Book Shop, Inc. and Trustees of First Stop Book Shop, Inc. v. MATTHEWS BOOK COMPANY, INC. Matthews Medical and Scientific Book Company McCoy Surgical Supplies, Inc. C. W. Albans, Inc., Follett Corporation, Follett St. Louis University Book Store
- Cited By
- 3 cases
- Status
- Published