Souza v. Elevate, Inc.

Filing 15

ORDER Granting John Souza's 2 Petition for Custodianship of Elevate, Inc. The Alternative Petition for an Inspection of Records is DENIED as MOOT. Signed by Judge Jennifer A. Dorsey on 9/19/2017. (Copies have been distributed pursuant to the NEF - SLD)

1
2
3

Troy L. Isaacson, Esq., NV Bar No. 6690
MADDOX ISAACSON & CISNEROS, LLP
11920 Southern Highlands Parkway, Suite 100
Las Vegas, Nevada 89141
Telephone: [phone]
Facsimile: [phone]

4
5
6
7
8

Ryan L. Isenberg
Georgia Bar No. 384899
Isenberg & Hewitt, P.C.
6600 Peachtree Dunwoody Road
600 Embassy Row, Suite 150
Atlanta, Georgia 30328
770-351-4400 (Voice)
770-828-0100 (Fax)
[e-mail]

9
10

UNITED STATES DISTRICT COURT

11

DISTRICT OF NEVADA

12
13
14
15
16
17
18
19

JOHN SOUZA,

)
)
PETITIONER,
)
)
V.
)
)
)
ELEVATE, INC.
)
)
RESPONDENT.
)
_____________________________________

CIVIL ACTION FILE
NO. 2:17-cv-001924

ORDER GRANTING PETITION FOR CUSTODIANSHIP
This matter comes before the Court on John Souza’s Petition for Custodianship of

20

Elevate, Inc., a Nevada Corporation, pursuant to NRS § 78.347, or in the alternative for an

21

Inspection of Corporate Records. The Court conducted a hearing on September 5, 2017.

22

Having considered the Verified Petition, Declaration of John Souza, having received

23

evidence, and having heard argument from Counsel, for the reasons that follow, the Court

24

GRANTS the petition and Orders that John Souza (“Souza”) is appointed Custodian of

25

Elevate, Inc. (“Elevate”).

26

Findings of Fact

27
28

Elevate was served with the Summons and Petition in this Matter. The commercial
registered agent attempted to notify Elevate to no avail. At the hearing on the Petition,
Page -1-

1

Souza demonstrated that, through counsel, he attempted to communicate with the former

2

CEO, Wright Thurston, by and through Elevate’s counsel in pending Utah litigation and

3

through another shareholder, but received no response. The evidence adduced at the hearing

4

demonstrates that all three of the officers and directors of Elevate, according the information

5

on file with the Nevada Secretary of State, had resigned from Elevate no later than

6

September 2016. Elevate’s business license expired in February 2016, and no filing of the

7

annual list of officers or directors, which was due by February 29, 2016, was made.

8

According to the Verified Petition, Elevate ceased business operations shortly after

9

four of the company’s key employees went to work for a competitor in or around October

10

2015. The Petition further shows that Souza is the owner of just over 4 Million shares of

11

Elevate stock, which was corroborated by a written consent of the then current, but now

12

resigned directors.

13

Conclusions of Law

14

Accordingly, the Court finds that pursuant to NRS § 78.347(1)(b), Elevate has

15

abandoned its business and has failed within a reasonable time to take steps to dissolve,

16

liquidate or distribute its assets in accordance with this chapter. Under this statute, Souza,

17

as a shareholder, has standing to petition the Court to appoint a custodian. Souza seeks to

18

have himself appointed as custodian, and by way of his Verified Petition and Declaration,

19

has satisfied the requirements of subsection NRS § 78.347(2).
ORDER

20
21

Souza is hereby appointed by this Court as Custodian of Elevate. Pursuant to NRS §

22

78.347(6), Souza has all the powers and title of a trustee appointed under NRS §§ 78.590,

23

78.635 and 78.650. In light of the evidence that Elevate has pending litigation against its

24

former employees, Souza, as Custodian, is specifically authorized to take such action as he

25

deems necessary to investigate and direct those matters, and obtain any and all of the

26

company’s corporate and financial records to investigate whether any claims exist against

27

any other party.

28
Page -2-

1

Souza, as Custodian, is further ORDERED to:

2

(a) take the necessary steps to reinstate Elevate into compliance as required under

3
4

NRS § 78.180, and must file proof thereof with the Court, and;
(b) after obtaining the information from Elevate, provide reasonable notice to all

5

shareholders of record of a shareholder meeting to be held within a reasonable time after an

6

application for custodianship or receivership has been granted, and file proof thereof, and;

7
8
9
10

(c) provide the Court with a report of the actions taken at the shareholder meeting
noticed by the custodian, and;
(d) provide the Court with quarterly reports of the activities of the custodian and the
board of directors and the progress of the corporation.

11

The Court will retain jurisdiction over the case to ensure compliance with the

12

statutory requirements, and as may be necessary to aid the Custodian in his efforts under this

13

Order. The Alternative Petition for an Inspection of Records is DENIED as MOOT.

14

IT IS SO ORDERED this 19th day of September, 2017.

15
_________________________
_______________
_ __ _ __ _
Hon. Jennifer A. Dorsey
ennifer Dors
nn
nnife
D rsey
s
United States District Judge
d St t Di t i t J

16
17
18
19
20
21
22
23
24
25
26
27
28
Page -3-