HOUSE DOCKET, NO. 1931        FILED ON: 1/19/2017

HOUSE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 816

The Commonwealth of Massachusetts

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PRESENTED BY:

Carmine L. Gentile

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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:

The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:

An Act to revise Massachusetts corporate charter revocation.

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PETITION OF:

HOUSE DOCKET, NO. 1931        FILED ON: 1/19/2017

HOUSE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 816

The Commonwealth of Massachusetts

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In the One Hundred and Ninetieth General Court
(2017-2018)

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An Act to revise Massachusetts corporate charter revocation.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
 

SECTION 1. Section 8.02 of chapter 156D of the General Laws, as appearing in the 2014 Official Edition, is hereby amended by adding at the end there of, the following:- No person may serve as a director who has, within the past ten years, been a director or officer of a corporation that was found to exceed or abuse the authority conferred upon it by law in a proceeding under section 14.30, 15.30-31, or 15.33 of this chapter.

SECTION 2. Section 14.30 of chapter 156D of the General Laws, as appearing in the 2014 Official Edition, is hereby amended by adding after subsection (4) the following subsection:-

(5) In a proceeding by any citizen of the state, or by a shareholder, if it is established that the corporation has continued to exceed or abuse the authority conferred upon it by law. Any complaint initiating a proceeding under this subsection must allege at least 3 criminal felonies, arising from three or more separate acts or omissions within the same 10 year period, and each of which concluded with the corporation receiving or entering one or more of the following:

(i) conviction, including by default;

(ii) plea of guilt, nolo contendere, or no contest;

(iii) entry into a non-prosecution or deferred prosecution agreement to resolve the charge, if the terms and conditions of the agreement include a requirement that the corporation make a payment equal to or greater than $1,000,000 to resolve criminal charges.

SECTION 3. Section 15.30 of chapter 156D of the general laws, as appearing in the 2014 Official Edition, is hereby amended by inserting after "more consecutive years" the following:-  , or if the foreign corporation has continued to exceed or abuse the authority conferred upon it by law. The secretary may determine that such exceedance or abuse has occurred based on the criteria set forth in section 14.30(a)(5) of this chapter, if the acts demonstrating the exceedance or abuse of authority have occurred at least partly in this state

SECTION 4. Chapter 156D of the general laws, as appearing in the 2014 Official Edition, is hereby amended by adding after Section 15.32 the following section:-

Section 15.3X. CITIZEN ACTION FOR REVOCATION

(a) Any citizen of the commonwealth may commence an action in the superior court of Suffolk county to revoke the certificate of authority of a foreign corporation authorized to transact business in the commonwealth if the foreign corporation has continued to exceed or abuse the authority conferred upon it by law. Any complaint initiating a proceeding under this subsection must satisfy the requirements set forth in section 14.30(a)(5) of this chapter, and furthermore allege that the acts demonstrating the exceedance or abuse of authority have occurred at least partly in the commonwealth.

(b) The court may order the secretary to revoke the certificate of authority or may take any other action the court considers appropriate.

(c) The court’s final decision may be appealed as in other civil proceedings.