Joy v. North case brief summary
692 F.2d 880 (1982)
CASE FACTS
The trial court dismissed certain defendant directors and officers in plaintiff's shareholder derivative action in which plaintiff alleged diversity of citizenship, common law breach of trust and of fiduciary duty, as well as violations of the National Bank Act, 12 U.S.C.S. § 84. A special litigation committee, which included some defendants, submitted a recommendation that there was a limited possibility of liability. The trial court concluded that the business judgment rule limited judicial scrutiny of the committee's recommendations to a determination of the good faith, independence, and thoroughness of the committee and placed the report under seal.
DISCUSSION
CONCLUSION
The court reversed the lower court's protective order on a special litigation committee report because it was submitted as evidence in support of a motion to dismiss plaintiff's shareholder derivative suit. The lower court's grant of summary judgment to defendants was reversed.
Recommended Supplements for Corporations and Business Associations Law
692 F.2d 880 (1982)
CASE SYNOPSIS
Plaintiff shareholder challenged an
order of the United States District Court for the District of
Connecticut that granted summary judgment to defendants, directors
and officers, in plaintiff's derivative suit alleging diversity of
citizenship, common law breach of trust and fiduciary duty, and
violations of the National Bank Act, 12 U.S.C.S. § 84.CASE FACTS
The trial court dismissed certain defendant directors and officers in plaintiff's shareholder derivative action in which plaintiff alleged diversity of citizenship, common law breach of trust and of fiduciary duty, as well as violations of the National Bank Act, 12 U.S.C.S. § 84. A special litigation committee, which included some defendants, submitted a recommendation that there was a limited possibility of liability. The trial court concluded that the business judgment rule limited judicial scrutiny of the committee's recommendations to a determination of the good faith, independence, and thoroughness of the committee and placed the report under seal.
DISCUSSION
- The court reversed the order sealing the report because the good cause asserted therefor was the attorney-client privilege, which had been waived by the submission of the report as a basis for summary judgment.
- The court disagreed with the committee's report and reversed the trial court, finding that a material issue of fact existed as to the liability of defendants, which precluded summary judgment.
CONCLUSION
The court reversed the lower court's protective order on a special litigation committee report because it was submitted as evidence in support of a motion to dismiss plaintiff's shareholder derivative suit. The lower court's grant of summary judgment to defendants was reversed.
Recommended Supplements for Corporations and Business Associations Law
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