Saturday, December 28, 2013

Ross v. Bernhard case brief

Ross v. Bernhard case brief summary
396 U.S. 531 (1970)

CASE SYNOPSIS
By writ of certiorari, the Court reviewed a decision of the United States Supreme Court of Appeals for the Second Circuit issued in petitioner shareholders' derivative action against respondent directors in which the appeals court reversed a district court order granting a motion to strike petitioners' jury demand.

CASE FACTS
Petitioners brought a derivative suit against the directors of their investment company, alleging that the directors violated the Investment Company Act of 1940,15 U.S.C.S. § 80a-1 et seq. The district court denied a motion to strike petitioners' jury demand, and the appeals court reversed, holding that a derivative action was entirely equitable in nature and that no jury was available to try any part.

DISCUSSION

  • The Court granted certiorari and reversed, holding that the right to a jury trial attached to those issues in derivative actions in which the corporation, if it had been suing in its own right, would have been entitled to a jury. 
  • The Court explained that under the Federal Rules of Civil Procedure there was only one action in which all claims could be joined and all remedies were available. 
  • Purely procedural impediments to the presentation of any issue by any party, based on the difference between law and equity, were destroyed. 
  • Accordingly, the Court determined that U.S. Constitutional Amendment VII preserved to the parties in a stockholder's suit the same right to a jury trial that historically belonged to the corporation and to those against whom the corporation pressed its legal claims.
CONCLUSION
The Court reversed the decision of the appeals court and affirmed petitioners' right to a jury trial in their shareholder derivative action.

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