Court Opinion

ID: 5867603
Source: CourtListenerOpinion
Date Created: 2022-01-13 01:37:52.859989+00
Date Added: 2024-06-11T08:44:36.892436
License: Public Domain

Order unanimously affirmed, with costs. Memorandum: Special Term correctly denied defendants’ motion to dismiss plaintiff’s complaint in this shareholder’s derivative action. The allegations in the complaint must be liberally construed (MacKay v Pierce, 86 AD2d 655). We conclude that plaintiff complied with subdivision (c) of section 626 of the Business Corporation Law by alleging with sufficient particularity that it would have been futile to attempt to secure the initiation of this action by the board of directors. The complaint shows that defendant, as majority stockholder, had power under the by-laws to remove plaintiff and his wife, the other directors, without cause. Moreover, defendant was managing director and facts are pleaded warranting the conclusion “that the directors are such only in form, and that the wrongdoer * * * against whom relief is sought actually perform[s] such directorate duties” (Marco v Sachs, 269 App Div 845, affd 295 NY 642; see Barr v Wackman, 36 NY2d 371, 379; Joseph v Amrep Corp., 59 AD2d 841). (Appeal from order of Supreme Court, Monroe County, Finnerty, J. — dismiss complaint.) Present — Hancock, Jr., J. P., Denman, Boomer, Green and Moule, JJ.