In 2015 Megatel C90-2, Inc., an aviation-services entity formed by Megatel Homes founders Aaron and Armin Afzalipour, leased a 1991 Cessna CE650 aircraft from Bank of Utah, as trustee for its Mexican owner, for $11,000 per month. C90 says the aircraft had airworthiness problems from the start; after a 2019 inspection in Mexico the Bank demanded over $100,000 in repairs, and C90, without the aircraft since June 2019 and having stopped rent in 2018, terminated the lease and sued.¹

The Bank counterclaimed in March 2020 for breach of the lease, obtained partial summary judgment against C90 when its counsel missed a response deadline, and added alter-ego theories against Armin Afzalipour and Megatel Homes. After a bench trial the trial court awarded the Bank $1,615,051.41 in actual damages and other amounts and imposed alter-ego liability; the Fifth Court of Appeals affirmed. The petition was filed June 21, 2024, the parties later settled, and on May 16, 2025 the Court granted their joint motion in part.¹

Petition for review from the Fifth Court of Appeals in a contract and veil-piercing suit; disposed under Rule 56.3 on a joint motion to dismiss pursuant to settlement, after supplemental briefing on the vacatur request (May 16, 2025 orders). Justice Sullivan filed a concurring opinion in No. 24-0206, joined by Justice Busby, explaining that he would deny requests to vacate courts of appeals' opinions after a settlement, and noting that Rule 56.3 sets a presumption against vacatur that the Court has overcome only rarely.²

Whether the court of appeals improperly expanded alter-ego liability by relying almost solely on undercapitalization, and whether alter-ego defendants added after limitations ran may assert limitations as a defense to their own liability.¹

Megatel C90-2, Afzalipour and Megatel Homes (Petitioners): Texas law permits alter-ego liability only where abuse of the corporate form causes injustice, undercapitalization alone is not enough, and the newly added defendants could assert limitations.

Bank of Utah (Respondent): the record showed gross undercapitalization, extensive control and intent to defraud creditors, supporting alter-ego findings.¹

Not applicable; the case ended on a motion.

None noted