Court Opinion

ID: 9845524
Source: CourtListenerOpinion
Date Created: 2023-09-24 03:23:43.524685+00
Date Added: 2024-06-11T09:16:12.785791
License: Public Domain

GREENE, Judge,
concurring in the result.
Although I agree with the majority that “plaintiff does not have standing to maintain a direct action seeking individual recovery against defendants based upon her allegations in this suit,” I write separately to address when a plaintiff-shareholder can maintain an individual action against fellow shareholders.
Generally, “shareholders cannot pursue individual causes of action against third parties for wrongs or injuries to the corporation that result in the diminution or destruction of the value of their stock.” Barger v. McCoy Hillard & Parks, 346 N.C. 650, 658, 488 S.E.2d 215, 219 (1997). This general rule, however, is governed by two exceptions. “First, a shareholder may bring an individual action against a third party when the third party ‘owed [her] a special duty.’ ” Norman v. Nash Johnson & Sons’ Farms, Inc., 140 N.C. App. 390, 419, 537 S.E.2d 248, 267 (2000) (Greene, J., dissenting) (quoting Barger, 346 N.C. at 658-59, 488 S.E.2d at 219), appeal withdrawn, 354 N.C. 219, 553 S.E.2d 684 (2001). “Second, a shareholder may bring an individual action against a third party when the shareholder suffered a ‘separate and distinct’ injury as a result of the alleged wrongful conduct of the third party.” Id. (quoting Barger, 346 N.C. at 658-59, 488 S.E.2d at 219). Thus, a plaintiff-shareholder, regardless of her status as a minority shareholder, can only bring an individual claim against majority shareholders if she is able to show they owed her “a ‘special duty’ or [she] suffered a ‘separate and distinct injury’ as a result of their alleged wrongful conduct.” Id.
In this case, as plaintiff has failed to show defendants owed her a “special duty” or she suffered a “separate and distinct injury,” she is not permitted to bring an individual claim against defendants.