Smith v. Chase & Baker Piano Mfg. Co.

Citations

• 197 F. 466
• 1912 U.S. Dist. LEXIS 1442

Syllabus

<p>1. Courts (§ 322*) — Federal Courts — Bill by Stockholder — Collusive Suit — Pleading.</p> <p>A bill brought' in the federal District Court by a minority stockholder to redress wrongs claimed to have been inflicted upon his corporation is demurrable if it fails to state that the suit is not a collusive one to confer on a federal court jurisdiction of a cause of which it would not otherwise have cognizance, as applied by equity rule 94 (29 Sup. Ct. xxxvii).</p> <p>[Ed. Note. — For other cases, see Courts, Cent. Dig. §§ 876-881, 887; Dee. Dig. § 322.*</p> <p>Rights of minority stockholders as to management of corporate affairs, see note to American Locomotive Sander Co. v. Economy Locomotive Sander Co.; 89 C. O. A. 482.]</p> <p>2. Corporations (§ 320*) — Bill by Stockholder — Requisites.</p> <p>A bill by a minority stockholder to redress wrongs claimed to have been inflicted upon the corporation is demurrable if it fails to set forth with particularity his efforts to secure action by the managing directors or the stockholders, and the causes of his failure to obtain such action as required by equity rule 94 (29 Sup. Ct. xxxvii), and especially where the bill shows that suit was brought without any attempt to settle the differences, though complainant was requested to attend a directors’ meeting.</p> <p>[Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1426-1431, 1433-1439; Dec. Dig. § 320.*]</p> <p>3. Corporations (§ 320*) — Stockholders’ Bill — Sufficiency.</p> <p>A bill by a minority stockholder against those in control charging infliction of wrong upon the corporation is insufficient where it fails to allege tangible facts sustaining general averments of fraud or misconduct.</p> <p>[Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1426-1431, 1433-1439; Dee. Dig. § 320.*]</p> <p>4. Corporations (§ 370*) — Officers and Stockholders — Mutual Dealings.</p> <p>Corporations controlled and managed by the same officers and stockholders can deal w