California Court of Appeal

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F5 Capital v. Pappas, 16-530

In a a shareholder derivative action on behalf of a company, alleging that individual members of the company's board and affiliated entities improperly exploited their control of the corporation in entering into three separate self-dealing transactions, the district court's dismissal of the complaint, concluding that the dilution claim was properly derivative under Delaware law and that plaintiff failed to plead demand futility under Fed. R. Civ. P. Rule 23.1(b)(3)(B), as to any of the claims, is affirmed where: 1) plaintiff's dilution claim was properly derivative, not direct; 2) the district court had subject matter jurisdiction to adjudicate the non-class, derivative claims; and 3) plaintiff did not allege facts sufficient to excuse it from making a pre-suit demand.

Appellate Information

  • Argued
  • Submitted
  • Decided
  • Published 2017/04/25

Judges

  • LYNCH

Court

  • California Court of Appeal

Counsel


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