Lesnik v. Public Industrials Corp.

Second Circuit

Lesnik v. Public Industrials Corp.

153 F.2d 783, 1946 U.S. App. LEXIS 1976

CourtCourt of Appeals for the Second Circuit

DecidedJanuary 23, 1946

DocketNo. 176

StatusPublished

This text of 153 F.2d 783 (Lesnik v. Public Industrials Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Lesnik v. Public Industrials Corp., 153 F.2d 783, 1946 U.S. App. LEXIS 1976 (2d Cir. 1946).

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Opinion

PER CURIAM.

When the jury disagreed and were discharged, no verdict remained; and the directed verdict was merely the adjudication! of the judge. It disappears with our reversal of the judgment entered upon it, and the case stands untried. See Federal Rule 50 (b), 28 U.S.C.A. following section 723c.

The plaintiff’s evidence upon this trial was in substance the same as before; indeed, it was somewhat stronger. The jury alone could weigh against it the testimony of the defendants; the issue being of their good faith, it was particularly their province. We need add nothing to what we said before (144 F.2d 968), except a word about “conspiracy.” The. wrong charged is the violation by the defendants of their fiduciary duties as directors. It is of course true that the failure to declare dividends had to be the act of a majority, but it was not necessary that the majority should be guilty of any concerted wrong. Each director, whose vote was governed by improper motives, [784]*784severally committed a wrong against the shareholders; and he made himself liable for any consequent damages, if his vote was necessary to the failure to declare the dividend, even though his fellows were innocent. “Conspiracy” has no application to such a situation; its use only serves to confuse.

Judgment reversed; cause remanded.

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PER CURIAM.

When the jury disagreed and were discharged, no verdict remained; and the directed verdict was merely the adjudication! of the judge. It disappears with our reversal of the judgment entered upon it, and the case stands untried. See Federal Rule 50 (b), 28 U.S.C.A. following section 723c.

The plaintiff’s evidence upon this trial was in substance the same as before; indeed, it was somewhat stronger. The jury alone could weigh against it the testimony of the defendants; the issue being of their good faith, it was particularly their province. We need add nothing to what we said before (144 F.2d 968), except a word about “conspiracy.” The. wrong charged is the violation by the defendants of their fiduciary duties as directors. It is of course true that the failure to declare dividends had to be the act of a majority, but it was not necessary that the majority should be guilty of any concerted wrong. Each director, whose vote was governed by improper motives, [784]*784severally committed a wrong against the shareholders; and he made himself liable for any consequent damages, if his vote was necessary to the failure to declare the dividend, even though his fellows were innocent. “Conspiracy” has no application to such a situation; its use only serves to confuse.

Judgment reversed; cause remanded.

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153 F.2d 783, 1946 U.S. App. LEXIS 1976, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lesnik-v-public-industrials-corp-ca2-1946.

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