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Posts Categorized: Derivative Actions

Posted: September 20, 2018

Court Declines to Dismiss Double-Derivative Action

On September 4, 2018, Justice Scarpulla of the New York County Commercial Division issued a decision in Simon v. French-American Surgery Ctr., Inc., 2018 NY Slip Op. 32184(U), refusing to dismiss a double-derivative action, explaining: Under New York law, double derivative actions may be brought by a minority shareholder of a parent company for harm to… Read more »

Posted: September 17, 2018

Shareholder Need Not Hold Share Certificates to Have Right to Assert Derivative Claims

On September 5, 2018, Justice Bransten of the New York County Commercial Division issued a decision in Lentini v. 219 W. 20th Str. Corp., 2018 NY Slip Op. 32181(U), holding that a plaintiff need not hold share certificates to have the right to assert derivative claims, explaining: The mere fact that the corporation did not issue any… Read more »

Posted: May 20, 2018

Derivative Action Dismissed for Failure to Plead Demand or Demand Futility

On May 9, 2018, Justice Sherwood of the New York County Commercial Division issued a decision in Glaubach v. PricewaterhouseCoopers, LLP, 2018 NY Slip Op. 30875(U), dismissing a derivative action for failure to plead demand or demand futility, explaining: Under Delaware law, and Delaware Chancery Court Rule 23.1, to have standing to pursue a derivative… Read more »

Posted: February 21, 2018

Derivative Action Dismissed for Failure to Plead Demand Futility With Particularity

On February 13, 2018, the First Department issued a decision in Retirement Plan for Gen. Empls. of the City of N. Miami Beach v. McGraw, 2018 NY Slip Op. 01027, dismissing a derivative action for failure to plead demand futility with particularity, explaining: The motion court correctly dismissed the complaint, as plaintiffs failed to adequately… Read more »

Posted: December 11, 2017

Derivative Action Plaintiff Loses Standing–And Action Must Be Dismissed–If It Sells Its Ownership Interest

On December 6, 2017, the Second Department issued a decision in Jacobs v. Cartalemi, 2017 NY Slip Op. 08506, holding that a derivative action plaintiff loses standing–and the action must be dismissed–if it sells it ownership stake in the company on behalf of which the plaintiff is suing, explaining: Members of a limited liability company… Read more »

Posted: December 8, 2017

50% Shareholder Must Bring Derivative Action, Not Action in Name of Corporation, Against Other 50% Shareholder

On November 9, 2017, Justice Ramos of the New York County Commercial Division issued a decision in U-Trend N.Y. Inv. L.P. v. US Suite LLC, 2017 NY Slip Op. 32502(U), holding that a 50% shareholder could not bring an action in the name of the corporation against the other 50% shareholder and instead must bring… Read more »

Posted: December 5, 2017

Plaintiff Without Standing to Bring Derivative Action Not Entitled to Fee Award Under BCL Sec. 626

On November 29, 2017, the Second Department issued a decision in Sakow v. Waldman, 2017 NY Slip Op. 08403, holding that a prevailing plaintiff that did not have standing to bring a derivative action was not entitled to a fee award under Business Corporations Law Sec. 626, explaining: Mawash moved for leave to renew its… Read more »