§ 6025 — Stockholders' derivative action brought in the right of the corporation to procure a judgment in its favor

New York § 6025

• Jurisdiction: New York
• Law BNK: Banking
• Title 6: Stockholders
• Art. 15: General Provisions Applicable to Banking Stock Corporations, Limited Liability Investment Companies, and Limited Liability Trust Companies

Text

§ 6025. Stockholders' derivative action brought in the right of the\ncorporation to procure a judgment in its favor. 1. An action may be\nbrought in the right of a corporation to procure a judgment in its\nfavor, by a holder of shares or of a beneficial interest in such shares.\n 2. In any such action, it shall be made to appear that the plaintiff\nis such a holder at the time of bringing the action and that he was such\na holder at the time of the transaction of which he complains, or that\nhis shares or his interest therein devolved upon him by operation of\nlaw.\n 3. In any such action, the complaint shall set forth with\nparticularity the efforts of the plaintiff to secure the initiation of\nsuch action by the board or the reasons for not making such effort.\n 4. Such action shall not be discontinued, compromised or settled,\nwithout the approval of the court having jurisdiction of the action. If\nthe court shall determine that the interest of the stockholders of any\nclass or classes thereof will be substantially affected by such\ndiscontinuance, compromise, or settlement, the court, in its discretion,\nmay direct that notice, by publication or otherwise, shall be given to\nthe stockholders or class or classes thereof whose interests it\ndetermines will be so affected; if notice is so directed to be given,\nthe court may determine which one or more of the parties to the action\nshall bear the expense of giving the same, in such amount as the court\nshall determine and find to be reasonable in the circumstances, and the\namount of such expense shall be awarded as special costs of the action\nand recoverable in the same manner as statutory taxable costs.\n 5. If the action on behalf of the corporation was successful, in whole\nor in part, or if anything was received by the plaintiff or plaintiffs\nor a claimant or claimants as the result of a judgment, compromise or\nsettlement of an action or a claim, the court may award the plaintiff or\nplaintiffs, claimant or claimants, reasonable expenses, including\nreasonable attorney's fees, and shall direct him or them to account to\nthe corporation for the remainder of the proceeds so received by him or\nthem. This subdivision shall not apply to any judgment rendered for the\nbenefit of injured stockholders only and limited to a recovery of the\nloss or damage sustained by them.\n