This post was originally published on Forbes Jun 3, 2015
Everybody knows that bad things can happen if you don't file tax returns that you are supposed to file. Interest and penalties, seizure of property and in the most extreme cases losing your liberty. Although loss of liberty for simply not filing is not very likely. When you are talking about corporations, there is another consequence. They can lose their charters. In some ways you could view that as a death sentence for a corporation. It can no longer do anything. Unlike people, as far as we know, it is not that hard to bring a corporation back from the dead. You catch up the delinquent taxes and do some paperwork, which will vary from state to state, and presto the corporation is back from the dead. Cohen Acquisition Corp learned from the Fourteenth Court of Appeals in Texas that even though it can be revived, that kind of zombie phase that it went through has consequence.
Like the plaintiff in Emmett Properties, Cohen filed suit against EEPB more than three years after the Secretary of State forfeited Cohen's charter for delinquent franchise taxes. As discussed above, Cohen's claims were extinguished on February 8, 2011. Because setting aside the forfeiture of a corporate charter pursuant to the Tax Code does not revive a corporation's extinguished claims, the March 29, 2011 reinstatement of Cohen's charter did not revive its extinguished claims against EEPB. See Emmett Props., 167 S.W.3d at 370 . Cohen raises additional arguments with regard to the issue in question.
However, we need not consider these arguments because we are bound by our prior decision in Emmett Properties. Accordingly, we overrule Cohen's sole issue on appeal.