Court Opinion

ID: 9454061
Source: CourtListenerOpinion
Date Created: 2023-08-04 18:34:33.166176+00
Date Added: 2024-06-11T17:33:57.077615
License: Public Domain

J. JOSEPH SMITH, Circuit Judge
(dissenting):
I dissent. I would affirm the order denying the motion to strike the demand for jury trial. The underlying claim is essentially “a suit at common law,” an action for a money judgment for unlawful conversion, breach of fiduciary duty, fraud and gross negligence. It would have been apt for jury consideration had the corporation itself sued. The issues are not so complex as to be beyond the competence of a trial jury. Cf. Dairy Queen, Inc. v. Wood, 369 U.S. 469, 479, 82 S.Ct. 894, 8 L.Ed.2d 44 (1962). The fact that historically it was necessary for the shareholder to resort to equity in order to step into the corporation’s shoes (Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 548, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949) ), should no longer bar jury trial of the corporate claim. The reason for the denial of jury is eliminated through the provision by the federal rules of one civil action in which the issues of the right of the shareholder to sue and of violation of fiduciary duty causing damage to the corporation may “be tried side by side or otherwise as may be convenient; that one may go to the jury while the other does not causes no difficulty,” Fanchon & Marco, Inc. v. Paramount Pictures, Inc., 202 F.2d 731, 735, 36 A.L.R.2d 1336 (2d Cir. 1953). I would agree with the result reached by the Ninth Circuit in DePinto v. Provident Security Life Ins. Co., 323 F.2d 826 (9 Cir. 1963), cert. denied 376 U.S. 950, 84 S.Ct. 969, 11 L.Ed.2d 970, rehearing denied 383 U.S. 973, 86 S.Ct. 1269, 16 L.Ed.2d 313.