Eisenberg v. Flying Tiger Line, Inc.

451 F.2d 267 (2nd Cir. 1971)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

Eisenberg (P) sued to enjoin a plan of reorganization and merger. It was a derivative action. Flying Tiger Line, Inc. (D) moved to require P to post security under New York Business Law Section 627. That motion was granted, and P was given 30 days to post $35,000 in security. P did not comply, and the action was dismissed. P appealed. The suit was brought on by a series of corporate maneuvers that left the 4.5 million original shares of the company as those of a holding company rather than those of the operating company. P contends that the end result of the plan was to deprive minority stockholders of any vote or any influence over the affairs of the company. D insists that the complex reorganization was done to bring about diversification without interference from the Civil Aeronautics Board.