Pflueger v. Sherman

75 F.2d 84, 1935 U.S. App. LEXIS 2868
CourtCourt of Appeals for the Ninth Circuit
DecidedJanuary 14, 1935
DocketNo. 7321
StatusPublished
Cited by5 cases

This text of 75 F.2d 84 (Pflueger v. Sherman) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pflueger v. Sherman, 75 F.2d 84, 1935 U.S. App. LEXIS 2868 (9th Cir. 1935).

Opinion

WILBUR, Circuit Judge.

Three actions were filed by stockholders of H. Flackfeld & Co., Limited, in relation to the alleged sale of that corporation’s assets, to American Factors, Limited:

1. Isenberg v. Sherman, in the Superior Court of the City and County of San Francisco, Cal.; judgment against the complaining stockholders, who were also the complainants below and are the appellants herein, affirmed by the Supreme Court of California, 212 Cal. 454, 298 P. 1004; petition for rehearing denied, with opinion, 212 Cal. 507, 508, 299 P. 528; motion to recall re-mittitur denied, with opinion, 214 Cal. 722, 732, 7 P.(2d) 1006; certiorari denied, 286 U. S. 547, 52 S. Ct. 501, 76 L. Ed. 1283. The first opinion by the Supreme Court of California is 50 pages in length.

2. Trent Trust Company, Ltd., v. Miller, Equity No. 2575, Circuit Court of the First Judicial Circuit of Hawaii. This action was still pending at the time the record herein was prepared.

3. The action herein.

On October 17,1924, the appellants herein instituted this suit in the Circuit Court of the First Judicial Circuit of Hawaii. The case was removed to the District Court of the United States for the territory. The bill was entitled one “for accounting, relief against fraud, for damages and incidental relief.”

From the foregoing statement, it will be seen that the facts involved in the present litigation have repeatedly been considered and stated by state and federal courts. For that reason, a detailed statement of the allegations of the present bill is not necessary.

Suffice it to say, the appellants allege that the corporation has been stripped of its assets for $7,500,000, whereas the true value thereof was more than $17,500,000; and that the sale of the assets “was accomplished by the fraud and conspiracy of” the corporation’s “officers and directors, and the Trent Trust Company, Ltd., the trustee in liquidation.”

In this connection, it should be noted that the Trent Trust Company, Ltd., one of the respondents-appellees in the instant case, was the petitioning trustee in the case of Isenberg v. Trent Trust Company, infra, which was strongly relied upon by the present appellants in their supplemental brief before the Supreme Court of California in the present controversy. Isenberg v. Sher[86]*86man, 212 Cal. 485, 486, 298 P. 1004, 299 P. 528, supra. Isenberg v. Trent Trust Company was twice before this court. 26 F.(2d) 609; on rehearing, 31 F.(2d) 553; certiorari denied, 279 U. S. 862, 49 S. Ct. 479, 73 L. Ed. 1001.

On October 31, 1924, the parties entered into a stipulation reciting the pendency of the California case in San. Francisco, involving the same parties and subject-matter, and agreeing, in substance, that the proceedings in the instant case should be stayed until the trial of the California case, and that “any final judgment rendered in said proceeding pending in the Superior Court of the State of California * * * shall be and become the final judgment and deter-minatipn of the rights of all the parties hereto in all jurisdictions.”

It is claimed by the appellants that by the terms of a subsequent stipulation they were given the right- to introduce further evidence in relation to all issues not determined in the judgment rendered in the California case. The appellees contend that such reservation applies only to another suit, No. 2575, supra.

On September 29, 1932, after the Supreme Court of California had rendered its final judgment, as set forth above, the appellant filed a motion in the court below in the instant case, which, as we have seen, had been stayed by stipulation of the parties,, asking that the cause be set for trial on all issues “raised by the pleadings herein which were not adjudicated to final judgment” in the California case.

On October 22,1932, the appellees moved the court below that judgment be rendered in their favor and against the appellants in accordance with the California judgment and the-above-mentioned stipulation.

On January 9, 1933, the complainants-appellants J. C. Pflueger and H. H. Pflueger asked for leave to file a supplemental bill, alleging, inter alia, that 185 shares of the stock pf H. Hackfeld & Co., Limited, owned by J. C. Pflueger, had not in fact been seized by the Alien Property Custodian as claimed, and that therefore the resolution of the stockholders of the company authorizing the sale to American Factors was not adopted with the consent of all the stockholders of the Hackfeld Company, and hence was absolutely void. The affidavit of Mr. Neylan in support of the motion for leave to file the supplemental pleading set forth that he had been ignorant of the material facts alleged therein at the time the original bill of complaint had been filed, and that such facts had been concealed from him and from the complainants below until the month of July or August, 1931.

In this connection, it should be stated that the first judgment of the Supreme Court of California in the present controversy was handed down on April 30, 1931. A motion to recall the remittitur, however, was denied, with opinion, by the same tribunal on January 29, 1932. At that time, the question of these 185 shares of stock was dis-cussed by that court, as may be gathered by the following language of the opinion:

“Appellants contend that the judgment of this court was improvidently' granted by reason of a mistaken idea as to the facts of the case; that such mistaken idea was caused by certain false suggestions in the briefs of opposing counsel; that the respondents [appellees herein] had the evidence as to the true facts, but failed to produce the same. The whole controversy centers upon the question as to whether the Alien Property Custodian, acting pursuant to the provisions of the Trading with the Enemy Act [see 50 USCA Appendix § 1 et seq.], lawfully seized 185 shares of common stock in H. Hackfeld & Co., Limited, belonging to J. F. Pflueger, before July 19, 1918, the date on which such shares were voted by the custodian’s representative at the stockholders’ meeting, at which the assets of the Hackfeld firm were sold to American Factors, Limited. * * *
“We have discussed the merits of the points raised by petitioners at some length, We have not done so with the intent of deciding those points on their merits, because on this proceeding we have no power so to do. This is so because, having determined not. to recall the remittit-ur, this court has no power now to decide any question in reference to the merits of this controversy.' Since the remittitur is not to be recalled, this case must be’ treated as having been -determined finally and no longer within .the jurisdiction of this court. The only purpose of discussing the merits is to show that the alleged misstatements and alleged suppression of evidence were all directed to an immaterial matter. If the evidence that petitioners [including the appellants herein]complain was not introduced had been introduced, it could not possibly have affected the judgment of this court, under the interpretation given by it, in its main opinion, to the Trading with the Enemy Act.”

[87]*87214 Cal. 724, 732, 7 P.(2d) 1006, 1007, supra. (Italics ours.)

The same 185 shares were also referred to in the State Supreme Court’s opinion denying a rehearing, 212 Cal. 507, 299 P. 528, on May 28, 1931.

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Bluebook (online)
75 F.2d 84, 1935 U.S. App. LEXIS 2868, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pflueger-v-sherman-ca9-1935.