On November 25, 2024, Justice Patel of the New York County Commercial Division issued a decision in OCFBrook Holdings, LLC v. TKS Brooklyn Ctr. Holding, LLC, 2024 NY Slip Op. 51611(U), holding that bringing a lawsuit in New York is not doing business here for purposes of LLC Law 802 and 808 or BCL 1312, explaining:
Defendants argue that Plaintiff lacks the capacity to bring the present suit pursuant to New York LLC Law §§ 808(a) and 802 where it did not obtain a certificate of authority to do business in New York at the time the suit was commenced. CPLR § 3211(a)(3) states, in relevant part, A party may move for judgment dismissing one or more causes of action asserted against him on the ground that: (3) the party asserting the cause of action has not legal capacity to sue. NY LLC Law states, a foreign limited liability company doing business in this state without having received a certificate of authority to do business in this state may not maintain any action, suit or special proceeding in any court of this state unless and until such limited liability company shall have received a certificate of authority in this state.
Plaintiff rebuts: (1) that Plaintiff is not doing business in New York and that bringing legal action in New York does not constitute doing business within the state; (2) that Defendants’ contentions are premature as Plaintiff has until the resolution of the action to procure a certificate of authority; and (3) that Plaintiff has already acquired a certificate of authority thereby curing any defect.
Those few cases discussing Limited Liability Company Law § 808 (a) rely upon the case law analyzing Business Corporation Law § 1312, which has nearly identical language. A defendant relying upon BCL § 1312(a) has the burden of proving that the foreign corporate plaintiff was doing business in New York without authority. Absent adequate proof to establish that the plaintiff is doing business in New York, the presumption is that the plaintiff is doing business in its state of incorporation.
The mere maintenance of an action by such a foreign corporation does not constitute doing business within the State. However, even if established, LLC Law § 808(a) does not avail defendants, as plaintiff LLC’s failure to obtain a certificate of authority to do business in New York before initiating the action is not a fatal jurisdictional defect and such certificate has since been obtained.
Defendants flatly contend that Plaintiff is doing business within the state without having received a certificate of authority. However, Defendants’ Memorandum of Law and the Affirmation of Gabriel S. Rosenberg, Esq. lack factual support to establish what, if any, business Plaintiff conducts within this state. Further, Plaintiff has established that the present suit is insufficient to show that Plaintiff is doing business within New York, and that Plaintiff has procured a certificate of authority following the commencement of this action thereby curing any defect. Thus, the portion of Defendants’ Motion to Dismiss the Complaint pursuant to CPLR § 3211(a)(3) is DENIED.
(Internal quotations and citations omitted).