My BusOrg professor in law school was a bigtime Boston Red Sox fan.  We didn’t hold it against him at the University of Missouri-Kansas City, because we sort of knew the pain Sox fans had felt for so long (they went 86 years between World Series titles; the Royals only went thirty, but still).  Big Tony* was an entertaining fellow with a biting wit, and he drove home some very important points about how to handle business law.  The most important (read: basic) lesson he taught us applies just as much to litigation as to corporate governance… get the company name right.

Name the correct foreign entity
Lots of juniors in the entertainment world

My variation goes something like this:  say you’re suing a guy named Harry Connick.  Which one?  Senior or junior?  It will matter, I promise you, because the senior is the former (longtime) D.A. in New Orleans, and he knows litigation, pal.  Hoo boy, he knows how to litigate.  Junior didn’t go as far.  He’s just a saloon piano player nobody’s ever heard of, but thanks to the old man, he knows some really top flight lawyers who also know how to litigate.  If you tag the wrong one in the lawsuit, you have a tough road ahead of you.

If you’re suing PwC because they goofed on your taxes, you’re not going to sue Price Water House, Inc.  If you do it correctly, you’re going to sue Pricewaterhouse Coopers LLP.  That’s the correct entity.  Price Water House, Inc. does not exist, so your suit is going nowhere.

Okay, sure, PwC is going to enter the suit anyway—and score some points with the judge in the process by not making  her deal with a silly issue—but, bottom line, make sure the right name is on the other side of the V.

If your defendant is a foreign entity, it’s even more critical that you properly name it in the suit.**

Don’t call it a Aktiengesellschaft (AG) when it’s really a Gesellschaft mit beschränkter Haftung (GmbH).  In German, that’s the difference between a corporation (Inc./Corp.) and a Limited Liability Company (LLC).  The distinction applies in Germany, Austria, and eastern Switzerland.

Don’t call it a Société anonyme (S.A.) when you really mean a Société à responsabilité limitée (SàRL).  Same analogy, but in French.  Applies in France, Belgium, western Switzerland…

Why does this matter, if the defendant is going to approach the situation like Pricewaterhouse and appear despite your scew-up?

Because service of process abroad won’t be effected if you misname the defendant.  Here in the U.S. (and maybe Canada), they aren’t going to quibble if you get it close.  Outside the U.S., you’ll have a problem if you name an entity defendant that does not exist—the government authority that serves documents won’t even process your request.  And yes, they do check.  You’ll get a tersely worded note that says “that defendant is not in our registry.”

In short, do not pass Go, do not collect $200, counsel.  You’re back to square one.  And you’re out all of the time & money you spent in the attempt.  So, properly investigate your defendant ahead of time—even better, thoroughly investigate potential business partners during due diligence.***

Sox* Gratuitous Red Sox logo just for Tony Luppino, whose tutelage in business law made corporate structures a whole lot less inscrutable.

** I have to look them up all the time.  Check out this really top-flight Wiki on on various entity types around the world.

*** If you need a good source, I’m happy to put you in touch with my Bloomberg guy.  They’ve got a pretty top-flight legal research program, augmented by all the business intel you can digest.